Revenue Service Payroll Fines Are Coming – Are You Fully Compliant?
Many Guernsey employers believe they are fully compliant because they submit their payroll tax returns each month.
However, we are increasingly finding businesses that are missing other mandatory reporting requirements, often without realising it.
Revenue Service has indicated that enforcement activity and penalties for non-compliance will begin shortly, making now a good time to review your position.
The Most Common Mistake
Many employers submit:
✅ Tax returns
✅ Social insurance returns
but overlook other required returns, such as:
- Secondary pension returns
- Economic statistics returns
The exact requirements depend on your business structure and whether you employ staff.
Unsure Which Returns Apply to You?
To help simplify what can be a confusing area, we’ve created the flowchart below. It provides a high-level overview of the reporting obligations that may apply depending on your business structure and whether you employ staff.
If You Employ Staff
Another common misconception is that a Secondary Pension Scheme is only required if employees choose to join it.
This is incorrect.
If you employ staff who are not directors, you should have a Secondary Pension Scheme in place, regardless of whether anyone has opted in.
The fact that an employee is part-time, temporary, seasonal, a student, or your nephew does not automatically remove the requirement!
Employers are often surprised to discover that they should have established a scheme and been submitting Secondary Pension information even where no pension contributions have been deducted.
The Hidden Economic Statistics Requirement
Economic Statistics reporting is probably the least understood part of the payroll process.
Many employers assume there is a separate Economic Statistics return that needs to be completed. Others assume they have no obligation because they have never seen an Economic Statistics submission within Returns Creator.
The reality is slightly different.
Economic Statistics data is submitted through the Secondary Pension return.
This means that if Secondary Pension reporting is not being completed correctly, Economic Statistics information is often missing as well.
The information collected includes details such as:
- Occupational Codes (the four-digit classification code assigned to an employee’s role)
- Hours worked during the reporting period
- Other employment data used for economic analysis and workforce statistics
Because this information is embedded within the Secondary Pension submission process, employers often do not realise they are responsible for providing it.
If You Are a Sole Director
For sole directors of limited companies who own more than 15% of the company’s shares, SP10 legislation can provide an exemption from establishing a Secondary Pension Scheme.
Unfortunately, this exemption is often misunderstood.
Many directors assume that because they qualify for SP10, they can tick a box, forget about pensions forever and ride off into the sunset. Unfortunately, it’s not quite that simple.
In practice, the reporting requirements still remain.
While SP10 may remove the requirement to establish a pension scheme, directors still need to ensure the appropriate returns are being submitted through Returns Creator or their chosen payroll software.
How to Check Your Position
Take a look at your Returns Creator account or payroll software.
If you are only submitting tax returns, or only tax and social insurance returns, it may be worth reviewing whether additional returns are required. Use the flowchart!
Need Help?
Payroll compliance has become increasingly complex, and many business owners are surprised to discover that they are missing mandatory submissions.
At DNA, our payroll team can review your current setup, identify any gaps, and help ensure you remain compliant with Revenue Service requirements.
Whether you need a one-off compliance review or a fully managed payroll service, we’re here to help.
📩 Contact the team to arrange a payroll compliance check on [email protected]
