Contact

News & Insights

The tax advantages of living in Gibraltar

Tax in Gibraltar

The tax year in Gibraltar runs from 1st of July until 30th June the following year – the standard rate of tax for resident individuals is 20%. Tax residency is conferred on any individual who is resident in Gibraltar for a period of at least 183 days in the period of a year, or in excess of 300 days in three consecutive years. Along with tax residency, a number of other key benefits are granted as standard. Gibraltar has no capital gains tax (CGT), and no inheritance tax, although residents may still be liable to for these in their country of origin. No tax is charged on interest accrued through savings, or on dividends originating from companies quoted on a recognised Stock Exchange. Any pension income within a Gibraltar QNUPS or QROPS can be limited to a flat rate of 2.5% making Gibraltar a great option for pensioners. And finally, there is no VAT or wealth tax.

Is Gibraltar a tax haven?

All of the previously mentioned factors are enough to set Gibraltar apart as a location with many benefits, but there are key features of Gibraltar’s tax regime that make it an extremely attractive proposition for High Net Worth Individuals (HNWI) as well. Under a scheme known as Category 2 Residency, qualifying individuals are only liable to pay tax on the first £80,000 of their worldwide income, which at current rates translates to approximately £28,000. It should be noted however that under the terms of Category 2 Residency, the individual will be liable to pay a minimum of £22,000 per year regardless of their earnings.

In order to qualify for Cat 2 residency an application must be made to the Finance Centre Director of Gibraltar accompanied by two references (one of which must be from a bank) along with a non-refundable fee of £1,000. The individual must not have been resident in Gibraltar in the preceding 5 years, and should have approved residential accommodation available to them during the qualifying year for the exclusive use of themselves and their family.

For High Net Worth Individuals, the rate of income tax in Gibraltar is an extremely compelling reason for seeking out Cat 2 residency. If all the above criteria are met, a certificate will be issued within approximately 2 weeks of application and all benefits will be extended to the qualifying individual. Although there are qualifying factors regarding year-long access to exclusive accommodation, there is no requirement for physical presence in Gibraltar outside of the 183 days per year stipulation.

A Gibraltar tax haven is a very real possibility for those with the means to qualify. With solid economic growth and a stable political system, it has a great deal to offer those looking for beneficial tax  regulations.

 

The above information is based on our understanding of current taxation legislation and practices  which is subject to change and does not constitute investment advice. You should seek advice from a professional adviser before embarking on any financial planning activity.

This communication is for informational purposes only and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.

Other News

What should you do with your pension?

One of the most common questions asked of expat financial services firms is what should clients do with their pensions. Some wish to keep all their money in a UK-based pension, some will look to transfer to a Qualifying Recognised Overseas Pension Scheme (QROPS) and others will want to take a tax-free lump sum from their fund. In short, what an individual chooses to do will depend heavily on their personal circumstances together with any advice they receive from their expat financial services professional.

Read More

Spotlight On … Peter Button – International Financial Adviser

Peter ButtonHow / why did you get into your line of work in the financial services sector?

I actually entered the financial services sector by chance. In 2012 I was studying my Masters in Finance when I was cold called to meet with a financial advisor (back in the days when cold calling was normal). I frankly answered that I had no funds to invest, but if they had a job for me then we could continue the conversation. Two weeks later I was employed as a junior assistant in the team and the rest, as they say, is history.

Read More

Select your country

Please select your country of residence so we can provide you with the most relevant information:

You are currently viewing the Blacktower Financial Management EU website.

You may be looking for the Blacktower United States website.

Blacktower United States > X Stay on this site

Or choose your country.