What is Social Insurance Contributions (Guernsey)?
Guernsey Social Insurance contributions are mandatory payments made by employers and employees that fund the island's social insurance system, including unemployment benefit, sickness benefit, retirement pension, and other social security benefits. Contributions are collected by the States Insurance Authority and remitted via the ETI (Employees Tax and Insurance) quarterly return system.
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Current Rate (Ongoing: quarterly for employers, annual for self-employed)
Employee: 7.5% of gross earnings; Employer: 7.1% of gross earnings; Self-employed (Class 2): 12.4% (2026 rates, capped at the upper earnings limit)
Example
An employee earning £50,000 per year pays 7.5% SI on earnings up to the upper earnings limit (£196,560 in 2026), giving SI of £3,750 (if all earnings are below the cap). The employer pays 7.1% = £3,550. Total cost to employer: £53,550.
How Social Insurance Contributions (Guernsey) works in Guernsey
Guernsey's Social Insurance system is governed by the Social Insurance (Guernsey) Law 1978 and subsequent ordinances. It is administered by the States Insurance Authority (not the Revenue Service), but contributions are collected jointly through the ETI return system alongside income tax.
**Contribution rates (2026)** | Category | Rate | Earnings threshold | |----------|------|-----------------| | Employee SI (Class 1) | 7.5% | On earnings from the lower earnings limit up to the upper earnings limit | | Employer SI (Class 1) | 7.1% | On the same earnings range | | Self-employed (Class 2) | 12.4% | On income between the lower and upper limits |
**Earnings limits (2026)** - Lower earnings limit: £9,984 per year, £832 per month (below which no SI is due) - Upper earnings limit: £196,560 per year, £16,380 per month (above which no SI is due on excess)
**The ETI return** Employers file the Employees Tax and Insurance (ETI) return quarterly. This single return captures both income tax (deducted from employee pay) and SI contributions. The return and payment are due by 15 April, 15 July, 15 October and 15 January for the preceding quarter. Late submission attracts a £250 late filing penalty.
**Benefits funded by social insurance** - Retirement pension (State pension) - Long-term incapacity benefit - Short-term incapacity benefit - Contributory unemployment benefit - Maternity benefit - Bereavement benefits
**Self-employed contributions** Self-employed individuals pay contributions annually. They must register with the Social Security Department within 28 days of starting self-employment. The self-employed contribution covers the same benefit entitlements as employed persons.
**Guernsey SI vs UK National Insurance** Guernsey SI is similar in concept to UK National Insurance but operates independently. There is a reciprocal arrangement with the UK for periods of contribution, but they are separate systems. Moving between Guernsey and the UK may affect pension entitlements and should be planned carefully.
Related terms
Guernsey taxes individuals resident in the island at a flat rate of 20% on worldwide income. There is no higher rate band, no capital gains tax, and no inheritance tax in Guernsey. Residents benefit from various personal allowances and reliefs that reduce the effective rate. Non-residents are taxed only on Guernsey-sourced income.
The States of Guernsey Revenue Service (commonly called the Revenue Service or the States Revenue Service) is the government body responsible for administering income tax, document duty, and social insurance contributions in Guernsey. It is the equivalent of HMRC in the UK or the IRS in the US. It issues assessments, collects payments, and enforces compliance.
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