Moving to Gibraltar

Relocating anywhere in the world can be fraught with difficulties, not least the personal upheaval of moving you and your family abroad. We can give you an insight into some areas you should consider before choosing Gibraltar as your next destination.

Relocating to Gibraltar

There are obviously a number of aspects to consider when choosing a new jurisdiction for your business and/or your family. We believe moving to Gibraltar can tick many of those boxes. Gibraltar’s location, two and a half hours flying time from London and other cities across the UK, and within the central European time zone means that there are only advantages to be had from relocating home, business or both here to Gibraltar.

Located on the Mediterranean and in the geographic confines of continental Europe yet endowed with a familiar, reliable and predictable common-law system, you get the best of both worlds. Combine this with the easy and developing connections from Gibraltar Airport to London, Manchester, Bristol, Birmingham and other locations, you have access to a number of international hubs, all within a couple of hours of the Peninsula.

We have a very well-developed single-day visit tourist product which attracts millions of visitors a year, feeding local small product and service businesses. Gibraltar’s location at the entrance to the Mediterranean is also responsible for significant revenues from a well-developed shipping and port services industry.

Geography and Climate
Gibraltar ‘the Rock’, is a peninsula of approximately seven square kilometres at the southernmost tip of Spain. It is approximately five kilometres long and 1.2 kilometres wide, dominated by the famous rock which rises to 1,396 feet above sea- level at its highest point and towers above the Strait of Gibraltar, the strategic waterway which connects the Mediterranean and the Atlantic Ocean.

The coast of Morocco lies some 16 kilometres to the south across the Straits. The climate is Mediterranean.

Political System
The legislature of Gibraltar consists of the Governor and the Gibraltar Parliament. The Gibraltar Parliament consists of the speaker and at least 17 democratically elected members. Usually elections are held every four years.

Defence, foreign policy and internal security remain the responsibility of the United Kingdom, which appoints the Governor as the representative of the Crown in Gibraltar. In all other matters Gibraltar is self-governing. The power of the legislature to make laws is exercisable by Bills passed by the Gibraltar Parliament, known as Acts, and assented to by the Governor on behalf of her Majesty.

Whilst the executive authority vests in the Governor, it is the Chief Minister and usually nine ministers, with responsibility for defined domestic matters, who constitute the Government of Gibraltar.

Legal System
Gibraltar has its own legal system, which is based on the English model, with variations introduced by local statutes termed ‘Acts’, in keeping with the development of Gibraltar as a finance centre.

With a dynamic and approachable regulator, in the form of the Financial Services Commission, makes Gibraltar a very attractive jurisdiction for business looking for a new home and is fast becoming the conduit of choice for European and third party country business from the EU and beyond looking to access the UK market.

Gibraltar offers a variety of taxation and financial products, allied to a fully developed industry of Fiduciary Services and vehicles such as protected cell companies, asset protection trusts and a variety of funds products.

Communication and Travel
The official and commercial language of Gibraltar is English although the majority of the population are also fluent in Spanish.

Gibraltar has an excellent digital and fibre- optic telecommunications system along with a modern postal service.

There are daily scheduled air services to and from London Gatwick and London Heathrow. There are also weekly flights to and from Manchester, Bristol and Casablanca (via Tangier) (Morocco). A ferry service also operates to Tangier.

Gibraltar is also a port of call for container ships and some of the world’s most prestigious cruise liners. A cruise liner terminal provides modern facilities for passengers.

Gibraltar is also within easy reach of the increasingly utilised airport of Malaga (Spain), which is a one-hour drive away.

Gibraltar was placed on the Organisation for Economic Co-operation and Development (OECD) White List of territories that has substantially implemented the internationally agreed standard on tax information exchange.

Furthermore, the OECD’s Global Forum on transparency and exchange of information for tax purposes issued its Phase II report on Gibraltar, with an overall rating of “Largely Compliant” – the same rating as Germany, the UK and the US.

This is modelled on the UK system with Comprehensive schools providing free compulsory education to National Curriculum standard to the children of people ordinarily resident in Gibraltar, up to age 15 and terminating in the examinations and coursework for the General Certificate of Secondary Education (GCSE).

Students may continue for a further two years to obtain their A-level examinations. Grants or scholarships are given for further study at UK universities and institutions of further education. Further, Gibraltar also recently opened its own university which offers a large range of further education courses. Private schooling is also available in Gibraltar and in Spain.

Currency and Exchange of Controls
The official currency is Sterling. However, the Government of Gibraltar issues Sterling notes and coins locally which circulate alongside those issued by the Bank of England.

A number of local banks are linked into the United Kingdom clearing system. The Euro is also widely accepted.

There are no exchange controls and residents and non-residents alike may maintain accounts denominated in foreign currencies.

Time Zone
Gibraltar time is the Greenwich Mean Time (GMT) plus one hour with clocks being advanced one hour between March and October.

Bank and Public Holidays
Public holidays include the 8 public holidays of England and in addition Commonwealth Day, the Queen’s Birthday, Gibraltar National Day and Worker’s Memorial Day.

Data Protection
Gibraltar’s data protection and e-privacy landscape has seen significant change in recent years. Gibraltar’s Data Protection Act 2004, which initially transposed the first Data Protection Directive (Directive 95/46/EC), was amended in 2018 in order to make changes to give effect to the EU’s General Data Protection Regulation (Regulation (EU) 2016/679, or “GDPR”). Just over two years later, the Data Protection Act 2004 has been further amended following the UK’s withdrawal from the European Union. The resulting regime is largely similar to that in England & Wales, and now brings in the concept of the “Gibraltar GDPR”, which is essentially means the GDPR as it forms part of Gibraltar law by virtue of section 6 of the European Union (Withdrawal) Act 2019, as read with Schedule 1 to the Data Protection, Privacy and Electronic Communications (Amendments etc) (EU Exit) Regulations 2019 (“the 2019 Regulations”).

Controllers operating within Gibraltar will be subject to the Gibraltar GDPR, and the host of data protection obligations that are derived from GDPR, which sets the highest standards of control and security measures. Although there is no longer a registration requirement for controllers, organisations processing personal data must, inter alia, ensure that such processing complies with the principles of lawfulness, fairness and transparency, purpose limitation, data minimisation, accuracy, storage limitation, integrity and confidentiality. In addition, the new accountability principle requires controllers to be able to demonstrate compliance with these principles to the Data Protection Commissioner, being the Gibraltar Regulatory Authority (GRA). International businesses importing/exporting personal data will have additional considerations, such as the EU’s GDPR regime and other international privacy laws and frameworks, which may or may not apply depending on the nature of processing.

Medical Services
The Medial Group Practice Scheme is funded by grant and by compulsory weekly contributions through social insurance. Not only are persons registered under the Scheme entitled to benefit but also the spouses and children of the registered person. In case of illnesses, which cannot be treated locally, patients will be sent for specialist treatment in the UK or Spain.

There are a number of doctors and medical centres which provide medical diagnosis and treatment. Private medical insurance is available through schemes such as the Hospital Savings Association (HSA), the British United Provident Association (BUPA) and a Le Carte Healthcare.

It is possible for a retiree that becomes resident in Gibraltar and was previously resident in the UK, and who has accumulated contributions in the UK to pass these contributions on to Gibraltar in order to benefit from Gibraltar’s public health system.

Gibraltar has a state of the art sports facility which includes football pitches, paddle tennis courts, tennis courts, squash courts, gyms, hockey pitches, water sports facilities and more much.

It also has two stunning waterfront marinas which includes a casino, luxury residential properties, a five star luxury yacht hotel, bars, clubs and other leisure facilities.

Gibraltar is only a 20 minute drive away from the renowned Costa de Sol which includes towns such as Marbella which is well known for its beautiful beaches and for having some of the leading golf courses in Spain, such as Valderrama.

Travel and Sightseeing
Gibraltar is rich in history and offers and array of attractions such as the upper rock, the Moorish Castle, St. Michaels Cave, the Great Siege Tunnels, the dolphin trips, the botanical gardens, commonwealth park and the Gibraltar museum to name a few.

An application for residency is made under Gibraltar’s Immigration, Asylum and Refugee Act, which permits the Governor to issue the necessary permit to any person who, in his opinion, is of good character and to whom he considers that it is in the interests of Gibraltar to issue such a permit.

In practice the application is made to the Principal Immigration Officer whom the Governor appoints and who will exercise his discretion within the parameters of the Act and immigration policy in accordance with instructions from the Governor in consultation with the Government.

The Immigration, Asylum and Refugee Act recognises that certain nationals have certain rights to residency. If a person is self- employed or likely to remain in employment for twelve months, he/she is entitled to a permit of residence, which will usually be granted for twelve months and are renewable thereafter if their circumstances have not changed and they continue to meet the requisite criteria.

While the Immigration, Asylum and Refugee Act provides the basic requirements that must be satisfied for the issue of such a permit, the Government of Gibraltar has issued guidelines highlighting factors that are relevant in considering applications for residency. These can be briefly summarised as follows:

  1. the purchase of a property sufficient in size to accommodate the applicant and all his/her family for residential purposes;
  2. the applicant must establish that he/she is in good health;
  3. the applicant must establish that he/she has adequate financial resources to maintain him/herself and his/her family without recourse to public funds.

Any person who obtains a Category 2 Individual certificate (further details of which are provided below) will have no difficulty in obtaining residence.

For non-UK/EU nationals, for example US or Chinese Citizens, the application for residency is more complicated.

Notwithstanding this, the Governor, under section 19(c) of the Immigration, Asylum and Refugee Act, has discretion to grant a residence permit to any person who in the opinion of the Governor is of good character, where it would be in the interests of Gibraltar that such a residence permit should be granted. The duration of the permit is also left to the discretion of the Governor. However, being in possession of a work permit will be considered as highly advantages when making an application.

Applications under this section of the Immigration, Asylum and Refugee Act are generally reserved to non-UK/EU individuals who are able to offer Gibraltar substantial benefits whether in investment, creation of employment or otherwise. Applications are made to the Governor via the office of the Administrative Secretary and Deputy Governor. The Government will be consulted on such applications.

An individual can apply for residency via one of the following three ways:

  • Employee
  • Self-employed
  • Self-sufficient (including Cat 2s)

In order to apply for a Civilian Registration Card all applicants must submit the following documentation:

  • Completed application form
  • Certified copy of passport
  • Proof of address
  • Proof of income/savings
  • Passport photo

Proof of address:

  • Only deeds or rental agreements will be accepted as proof of address
  • Utility bills will not be accepted

UK/EU National Employee
If you are in permanent employment then you must submit a copy of your Ministry of Employment Contract, accompanied by a letter from your employer stating that you are in employment.

Non-UK/EU National Employee
A valid work permit must be produced when applying for a Civilian Registration Card.

All Self-Employed
Persons who are registered as self- employed must submit their Business Name Registration Act certificate accompanied by a Certificate of Registration as a self- employed Person from the Income Tax Office. Receipt of payment of tax will also be required.

UK/EU National Self-Sufficient
Proof of funds in the form of bank statements for the six months prior to the application or a valid Category 2 Individual Certificate.

Non-UK/EU National Cat 2 Individual
A valid Category 2 Individual Certificate must be submitted.

All self-sufficient and Cat 2 individuals must take out private medical insurance that covers treatment in Gibraltar. In order to be covered by private medical insurance the minimum requirements would be for policy benefits of at least £100,000 per year including in-patient and day-patient treatment in Gibraltar, the Spanish hinterland and the United Kingdom hospitals.

The taxation of the income for both individuals and companies is governed by the Income Tax Act 2010 (“Tax Act”), Rules and Regulations. The Tax Act introduced a system of self-assessment that requires both self-employed individuals and companies to calculate their own tax labiality for any year of assessment as well as make returns of their own income.

Persons Other Than Companies
Persons other than companies, such as individuals and trusts, are chargeable to tax upon the income specified in Tables A to C on income accrued in and derived from Gibraltar. Persons ordinarily resident of Gibraltar are also chargeable to tax upon the income specified in Tables B & C on a worldwide basis.

Distributions made from a trust to a Cat 2 individual or non-resident will not be taxable in Gibraltar.

Personal tax rates will vary according to the level of income and allowances available, however, the effective rate of tax is approx. 25%.

Tax Year and Year of Assessment
The tax year runs from 1 July to 30 June.

Individuals and trusts must prepare and file their tax returns from 1 July to 30 June of each year.

Filing Dates
Individuals must file their tax returns by 30 November of each year following the end of that tax year.

Payment Dates
Tax on the income from employment is deducted from wages and salaries under the PAYE system.

Self-Employed & Cat 2 Individuals
These individuals must make two tax payments on account, by 31 January and 30 June, in each year and each payment on account should be 50% of the tax paid in the previous year’s assessment. Final payment of tax should be submitted with the individual’s tax return and should be the tax liability for that year less the two tax payments on account made.

There is no VAT, capital gains tax, estate duty, wealth tax, or inheritance tax in Gibraltar.

Gibraltar offers the opportunity for high net worth individuals to obtain Cat 2 status which places a cap over the tax liability of that individual. Tax is applied to the first £118,000 of assessable income (including worldwide income) meaning that a Cat 2 individual will pay a maximum of £44,740 tax per annum, subject to a minimum tax payable of £37,310 per annum (current rates).

Requirements for Cat 2 Status

  • Must have available for exclusive use approved residential accommodation in Gibraltar for the whole year of assessment (can be either purchased or rented).
  • Must produce two independent references from recognised institutions/ professionals (1 must be from a bank and the other from a law or accounting firm).
  • Must produce valid passport and full CV.
  • Must produce a statement of worth showing a minimum of £2m.
  • Not have been resident in Gibraltar for 5 years immediately preceding the Cat 2 application.

A non-refundable application fee of £1,000 is payable on submitting an application.

High Executive Possessing Specialist Skills (HEPSS)
HEPSS status is a special employment status available to those individuals who intend to relocate to Gibraltar and take up employment.

An individual in respect of whom a HEPSS certificate is issued shall be charged to tax on the first £160,000 of their assessable income only. This would mean that an individual with HEPSS status would pay a fixed rate of £43,140 tax per annum (current rates) regardless of how much they would earn from that employment.

Requirements for HEPSS

  • Must have available for exclusive use approved residential accommodation in Gibraltar for the whole year of assessment (can be either purchased or rented).
  • Possess skills that are necessary to promote and sustain economic value in Gibraltar.
  • Possess skills that are not readily available in Gibraltar.
  • Not have been resident in Gibraltar for 3 years immediately preceding the Cat 2 application.
  • Earn more than £160,000 per annum from that employment.
  • Must produce two independent references from recognised institutions/ professionals (1 must be from a bank and the other from a law or accounting firm).
  • Must produce valid passport and full CV. A non-refundable application fee of £1,000 is payable on submitting an application.