Jersey ends time limits on contribution relief for new incapacity awards

Insured persons in Jersey who receive long term incapacity allowance on the basis of an assessment made on or after 19 October 2026 are excepted from liability to pay social security contributionsJerseylaw for as long as they remain in receipt of the allowanceJerseylaw, and are credited with contributions of the appropriate class for that periodJerseylaw in accordance with Article 15 of the Social Security (Contributions) (Jersey) Order 1975.

The exception covers contributions under the Social Security (Jersey) Law 1974. The credit preserves the person's contribution record while the exception applies. Article 15 sets the daily credited amount by reference to the standard monthly earnings limit for Class 1 and to the monthly Class 2 amount due, with adjustments where the person has earnings in the month.

Allowances awarded on assessments made before 19 October 2026 stay under the previous rule in Article 6Jerseylaw, now headed to reflect that cut-off. Exception and credits there depend on the assessed degree of incapacitationJerseylaw: the person is excepted only where the percentage appears in Column 1 of Schedule 3Jerseylaw, and only for the number of months Column 2 gives for that percentageJerseylaw. The table runs from 540 months at 100 per cent down to 3 months at 20 per cent, with intermediate steps including 360 months at 70 per cent, 120 months at 60 per cent, 60 months at 50 per cent and 12 months at 30 per cent.

Where incapacitation arises independently from two or more relevant diseases or injuries, Article 6 aggregates the percentages, disregarding any excess over 100 per cent. No exception or credit is given for any period before the period for which the allowance is received. That no-backdating rule also appears in the new Article 6AA structure through its framing around periods of receipt, and it continues expressly for incapacity pensions under Article 6A.

For payroll practice, the assessment date now controls which regime appliesJerseylaw. An employee whose long term incapacity allowance follows an assessment dated 19 October 2026 or later falls under the open-ended Article 6AA exception for the whole period of receiptJerseylaw, without a Schedule 3 month capJerseylaw. An employee whose allowance follows an earlier assessment remains under Article 6Jerseylaw, so the employer and any adviser should check the assessed percentage against Schedule 3 and count the months of exception and credits from that table.

Legal basis is the Social Security (Contributions) (Jersey) Order 1975 as amended by the Social Security (Contributions) (Jersey) Amendment Order 2026, Articles 6, 6AA and 15 and Schedule 3.