FK Income Tax

General reference only. This Guide is general tax/accounting reference material for AI-assisted workflows. It has not been reviewed for any specific person's facts, documents, elections, deadlines, residency, filing status, or local procedures. Do not rely on it to file, pay, amend, or take a tax position without review by a qualified professional in the relevant jurisdiction.

Who this applies to

Use for individuals with 2026 income, including sole traders and partners. Residents and ordinarily resident people are assessed on worldwide income; a person who is neither is assessed on Falkland-source income and duties performed here. Residence normally requires physical presence for at least 183 days in the income year; ordinary residence can survive a temporary absence. Count arrival and departure days as presence under §200(3). Ordinary residence means habitual residence except absence the Commissioner considers temporary (§200(1)); immigration permission is not the tax test. FIGTO 2026 guide, §§3-4; Taxes Ordinance, §§2, 8, 13.

Quick answer: establish residence and income sources, subtract permitted deductions and the personal allowance, apply the two marginal bands below, and deduct POAT already paid. The Falklands are a separate tax jurisdiction; do not load UK income-tax rules as the computation.

Rates, bands and thresholds

Item	Amount and condition	Official source
Personal allowance	GBP 16,860 for resident and/or ordinarily resident individuals; only someone who is neither has day-apportioned entitlement	§16 and FIGTO §4, 2026 guide
Lower band	21% on the first GBP 18,000 of chargeable income after deductions	§10(a)(i)
Upper band	26% on the excess over GBP 18,000	§10(a)(ii)
Non-resident employment POAT	21% of gross remuneration; assessment may instead produce a refund or additional tax	FIGTO §6

These are marginal rates. The allowance is not a rebate from the tax. Husband and wife are assessed independently. FIGTO §4.

The base

Include wages, taxable prescribed benefits, business profits, pensions, rents, interest and dividends subject to their specific statutory treatment. Do not treat gross sole-trader receipts as net profit. Reconcile receipts to accounts and subtract expenditure incurred wholly and exclusively for business; remove private and capital costs and substitute statutory depreciation allowances where eligible. §§8, 57-59, 97-119 govern exemptions, deductions and allowances. Ordinance.

Section 15 permits own compulsory RPC under Retirement Pensions Ordinance §10 and own voluntary RPC under its §12. Approved pension contributions and relevant approved professional subscriptions have separate approval conditions. A §57A donation deduction requires a claim, registered-charity status at donation, at least GBP 50 donated and the charity's written evidence received by the Commissioner. Personal donations must be money; business gifts can be in kind at the lower of cost and value to the charity. Apply charity relief after other deductions/allowances including losses, without reducing income below zero. §§15, 57A. The 2026 FIGTO guide restricts the ordinary non-resident deduction list to compulsory RPC and charitable donations; do not assume all resident reliefs apply. §§15, 15A, 57A, Part III; FIGTO §4.

Exclude interest under §57(1)(l) on bank/branch deposits in the Islands, registered co-operative-society funds and funds in the Falkland Landholdings Corporation Provident Fund or Falkland Islands Company Ltd Provident Fund. This does not exempt overseas deposits. Section 57(1)(r) exempts employment income, directors' emoluments and employment benefits for a twelve-month period if presence here during that period is 45 days or less. Count the whole period and arrival/departure days; this domestic exemption differs from the UK treaty. §§57, 200(3).

Claim commercial business losses and show their use on the loss-period return. Under §§125-126 first set against other chargeable income for the same year. Unrelieved loss may be carried back to the same business's immediately preceding period profits, then that preceding year's other chargeable income if the business was carried on in that year; alternatively carry forward while the same business continues, against its next-period profits then other chargeable income, successively until exhausted. Claim within six years after the loss period; never use twice. Incorporation has separate §127 conditions. §§125-127. For ordinary plant/vehicle pools, small capital assets and buildings, use the capital-allowance method in fk-corporate-income-tax, which also applies to qualifying sole-trader assets.

Prescribed employment benefits

Distinguish earnings/non-cash emoluments under §8(1)(b) from prescribed benefits under §8(1)(c). The prescribed categories are employer-paid travel, motor vehicles within rule 2(3), loans and living accommodation including board, heating and electricity. Directors count as employees; employer arrangements and family benefits are generally attributed to the employee under rule 2. The values below are taxable income, not tax. Benefits Rules 2-4.

Benefit	Value and conditions	Official source
Substantially furnished whole dwelling	GBP 1,500 per countable room annually, maximum seven rooms; part-year and exclusions below	Rule 4(6)-(7), Table A
Whole dwelling not substantially furnished	GBP 1,150 per countable room annually, maximum seven rooms; part-year and exclusions below	Rule 4(6)-(7), Table A
Heating/electricity for exclusive whole dwelling	GBP 750 per countable room annually, maximum seven rooms, additional to dwelling; family uplift below	Rule 4(8B)-(9)
Other accommodation with board and utilities	GBP 18.50 per benefit day, annual cap GBP 6,100 before family uplift	Rule 4(8)-(9), Table B
Other accommodation with board, no utilities	GBP 14 per benefit day, annual cap GBP 4,600 before family uplift	Same
Accommodation only or board only	GBP 7 per benefit day for each category, annual cap GBP 2,300 for each before family uplift	Same
Other heating/electricity	GBP 4.50 per benefit day, annual cap GBP 1,500 before family uplift	Same
Prescribed vehicle	GBP 60 per day of enjoyment, annual cap GBP 4,500, less employee payment; duties-only exception below	Rules 4(2), 5(1)(d), 6(2)

For a whole dwelling count bedrooms, living rooms and kitchens, but exclude garages, outbuildings, porches, bathrooms, lavatories, larders, halls and passages. Rule 6(1) prorates the Table A house value for part-year provision. Family occupation does not increase that house value. For Table B and exclusive-house utilities add 20% for the spouse and 10% for each child using the benefit. Table B uses actual benefit days, subject to its annual caps. Subtract the employee's payment for the relevant benefit, floor zero; do not deduct house rent again from utilities. A just-and-equitable reduction needs the Commissioner's determination. Rule 5(7) excludes accommodation for agriculture/horticulture employees, where the Commissioner is satisfied residence there is necessary for duties, or where it is not onshore. Rules 4-6.

For example, seven countable furnished rooms all year less GBP 2,400 employee rent produces GBP 8,100 income. Separate employer-paid utilities with a spouse and two children produce 7 × 750 × 1.4 = GBP 7,350 before utilities payments. These are assumed facts and annual benefit values, not tax bills. Do not extrapolate the express Table A prorating rule to part-year exclusive-house utilities without FIGTO's instruction.

Rule 2(3) excludes from the prescribed vehicle definition goods/burden vehicles designed above 3,500 kg and defined mobility scooters, motorcycles, mopeds and motor scooters. This is not a blanket exemption of every possible employment receipt. Rule 5(1)(d) excludes a vehicle necessarily required for duties and not used for another purpose. Record actual private-use permission and employee make-good payments. For 20 benefit days with GBP 100 employee payment, 20 × 60 - 100 = GBP 1,100 income; for 100 days, min(100 × 60, 4,500) - 100 = GBP 4,400. Rules 2, 4-6.

Travel is normally valued at the employer's payment/reimbursement. Deductible duties expenses are excluded. For an employee not normally resident immediately before employment, qualifying travel for the employee, spouse and children is excluded up to the contemporaneous economy-flight/equivalent cost between the Islands and the country of origin (usual residence immediately before employment). A child must be under 18 at journey start. Relief covers one return journey per qualifying person per calendar year; where several are funded, select the one costing the employer most. The final journey home is additionally allowed in the last employment year. Excess cost remains a benefit. Keep dates, ages, origin evidence and contemporaneous fares. Rules 4(1), 5(1)(c), 5(2)-(5A), 6(2).

Loans use interest at base lending rate plus three percentage points less interest actually paid. If written off, compare the write-off with the interest benefit and use the higher where both apply. The below-GBP 500 test is the aggregate annual benefit value across loans, not principal. Ordinary-course lender loans on comparable customer terms and an individual's normal domestic/family/personal loans have rule 5(6) exclusions. A non-loan benefit valued under rule 4 at below GBP 50 is excluded, not merely its first GBP 50. Employee payments reduce values without producing a loss. Rules 4(3)-(5), 5(1), 5(6), 6.

Deadlines and filing

The income year is January to December. §9 uses preceding-year income for the year of assessment: 2026 income normally belongs in the 2027 assessment cycle. Do not call the return due July 2026 a return for 2026 income.

1. Obtain the annual personal return from FIGTO and check the tax year printed on it. Returns are normally issued in March after the income year. The 2026-income form was not yet issued when this Guide was read.
2. Complete the income-source schedules with accounts for business income, worldwide income where applicable, supporting deductions and POAT certificates. Reconcile the total income, allowance, chargeable income, tax and credit to the computation.
3. Submit by 31 July following the income year or the later notice period: §12 provides 60 days from issue, subject to a longer period in the notice. Retain the return and delivery evidence. Tell FIGTO if chargeable but no notice or return has been received; §12(3) requires notification within four months of the start of the assessment year unless a notice or return already applies.
4. Check the assessment against the return. Pay by the later of 1 October in the assessment year and 30 days after service of the assessment. Use FIGTO's current remittance advice and taxpayer reference.

§§9, 11-12, FIGTO individual page. A non-resident repayment election under §93(2) requires a return before the end of the year following deduction: 2025 deductions by 31 December 2026, and 2026 deductions by 31 December 2027. This differs from the ordinary July/notice deadline. Under §93(5), insufficient POAT can remove final-withholding treatment. §93. Preserve accounting records for at least six years after the chargeable period; the Commissioner can require longer under §192A.

Penalties and interest

Failure to comply with §12 attracts GBP 100; continued failure three months after the due date attracts a further GBP 200. Payment does not discharge the filing obligation. Late income tax bears interest at three percentage points above the statutory base lending rate, from its due date. The current bank rate is not supplied here. §§11(2)-(4), 12A. Under §189, failures or incorrect returns/information without reasonable excuse are offences; where no other civil penalty is provided, the penalty is twice the tax payable for the omitted return/notice or twice the tax undercharged (or which would have been undercharged). Wilful conduct with intent to evade under §188 can attract three times the relevant period's tax alongside prosecution. These conditions differ; they are not automatic rates for every error. Records failures under §192A can attract the greater of twice tax payable and GBP 5,000. §§188-192A.

Cross-border points

Duties performed here do not become foreign-source merely because salary is paid overseas. Ordinary residence must also be checked for someone away for part of the year. §13. Use fk-cross-border-tax for UK treaty conditions and foreign-tax credits, and fk-payroll-social for deduction and contribution operation.

Two worked examples that recompute

Resident, no other reliefs. Hypothetical income after business adjustments is GBP 40,000, with GBP 1,000 of qualifying deductions before the allowance. Chargeable income is GBP 22,140. Lower-band tax is GBP 3,780 and upper-band tax GBP 1,076.40, giving GBP 4,856.40 before POAT. The amounts are assumed facts; the rates are §10 above.

name: Resident annual income tax
inputs:
  income: 40000
  deductions: 1000
steps:
  chargeable: max(0, income - deductions - 16860)
  lower: min(chargeable, 18000) * 0.21
  upper: max(0, chargeable - 18000) * 0.26
  tax: lower + upper
expected:
  chargeable: 22140
  tax: 4856.40

Non-resident decision. Assume neither resident nor ordinarily resident, 100 days in the Islands, GBP 10,000 of local earnings, no RPC or other deductions, and no treaty exemption. Gross POAT is GBP 2,100. On an assessment with a 100/365 personal allowance, tax is GBP 1,129.97, so filing can recover GBP 970.03. High earnings can instead produce extra tax: never promise a refund solely because an allowance is available. FIGTO §6.

name: Non-resident final withholding versus assessment
inputs:
  income: 10000
  days: 100
steps:
  allowance: 16860 * days / 365
  chargeable: max(0, income - allowance)
  assessment: round(min(chargeable,18000)*0.21 + max(0,chargeable-18000)*0.26,2)
  withholding: income * 0.21
  refund: withholding - assessment
expected:
  assessment: 1129.97
  refund: 970.03

Ask the client first

• Days present, duties location, prior residence and any temporary absence.
• Every income source, including foreign income and taxable benefits.
• Business accounts, capital purchases and loss claims already used.
• Own RPC, approved pension payments, subscriptions and donation evidence.
• POAT certificates, return notice and assessment dates.
• Treaty residence and foreign tax paid or refunded.

Sources

Source and text actually read	URL	Read on
Taxes Ordinance 1997, June 2026 consolidation; §§2, 8-16, 57-59, 93, 97, 125-127, 188-192A and 200, including neighbouring deduction and residence provisions. §16: “a deduction of £16,860.00”; §10: “on the first £18,000”	https://legislation.gov.fk/download/pdf/05a29220-06c3-4560-867c-99d6c5200d0d/15f327cc-37ae-4304-a080-e3d54a80bd43/fiord-1997-14_2026-06-12.pdf	2026-11-11
FIGTO 2026 individual guide, all three pages, residence, deductions, withholding and exemptions. “first £18,000 at 21% and any remainder at 26%”	https://www.gov.fk/taxation/wp-content/uploads/sites/25/2026/02/General-Tax-Guide-Individuals-2026.pdf	2026-11-11
FIGTO individual page, return and payment paragraphs. “31st July or 60 days from the date of issue, whichever is later”	https://www.gov.fk/taxation/individuals-employees/	2026-11-11
Benefits in Kind Rules 2003, read for complete rules 1-7 and Tables A/B; rule 4: “maximum value of £4,500”; rule 6: “shall not be reduced below zero”	https://legislation.gov.fk/download/pdf/e03b7d0c-053a-4c18-aca7-0f2d5a6bcfdd/a0115689-5ac3-4dcc-877a-ea917eea7b7d/fisl-2003-27_2022-11-09.pdf	2026-11-11

Not yet confirmed: unissued 2026-income return and its 2027 field numbering; comprehensive approved-pension relief limits/approvals; operational part-year exclusive-house utilities valuation. No unsupported figures are used for these.