Are you looking to re-locate abroad? Does the idea of a more permanent Mediterranean lifestyle beyond the confines of your holiday home sound appealing? Is this on your wish list but the conundrum of Brexit is making you feel uneasy?
Gibraltar may offer the ideal residency solution.
Strategically positioned between the Mediterranean and Atlantic seas, with mild winters and almost 300 days of sunshine each year, Gibraltar provides the quality of lifestyle associated with warmer climates. It is a small territory with big character and even bigger opportunities. Its proximity to historic Spanish Andalucia and the Portuguese Algarve brings beautiful beaches and leading golf courses to your doorstep.
The Gibraltar Category 2 status and residency offers attractive tax benefits to qualifying individuals. As a successful applicant, you would only be taxed on the first £80,000 of your worldwide taxable income. The annual income tax liability is currently capped at £29,800. There is no capital gains tax, inheritance tax or value added tax in Gibraltar.
As a British overseas territory, Gibraltar enjoys close ties with the UK, is English speaking and its official currency is the pound, eliminating exchange rate fluctuations for residents with UK derived income. Its economic and political stability, sound financial centre, low crime rate and British influence make it an ideal home for expatriates.
Gibraltar Category 2 Status
Gibraltar is a desirable jurisdiction for those with substantial worldwide assets who would like to enjoy the financial benefits of compliant tax planning combined with a unique Mediterranean lifestyle.
What is Category 2 status?
The Qualifying (Category 2) Individual Rules are governed by the Gibraltar Ministry of Finance and consist of specific rules and requirements that allow certain individuals to establish residence in Gibraltar and benefit from favourable, low income tax treatment. It is particularly attractive to individuals from countries with high levels of income tax, such as Great Britain, Switzerland, Germany and France. This special status is subject to application, and will be granted at the discretion of the Gibraltar Finance Centre Director, once certain criteria have been met. Residence can then be easily obtained once the Category 2 status has been granted.
What are the requirements?
- The purchase or rental of approved residential accommodation in Gibraltar that is suitable to meet the needs of your family circumstances. This must be available for your and your family’s exclusive use for the whole of the year of assessment.
- Minimum of £2m net assets. The Government of Gibraltar will wish to ensure that the applicant has the financially means to be self-sufficient.
- Non Gibraltar resident for the five years preceding the application.
- A Curriculum Vita listing qualifications and work experience, and two references to confirm your good financial standing. One must be from a recognised Banking institution.
- Private medical insurance.
Key Features and Benefits
As a Category 2 Individual, you will have your Gibraltar income tax capped to the maximum, calculated on the first £80,000 of assessable income, irrespective of how much is actually earned throughout the year. The annual tax liability ranges from a minimum of £22,000 to a maximum of £29,800, depending on your individual circumstances. Tax is only paid on income remitted to Gibraltar.
As a Category 2 resident in Gibraltar, you can take full advantage of Gibraltar’s status as a reputable offshore finance centre, where there is no inheritance tax, gift tax or capital gains tax.
Children are eligible to attend local school in Gibraltar and benefit from a high-level education that follows the UK national curriculum.
There is no minimum number of days that have to be spent in Gibraltar in any year of assessment.
In general terms, as a Category 2 Gibraltar resident, you should not engage in any trade, business or employment in Gibraltar, although there are certain permissible activities.
How can we help?
Our highly experienced team can assist you throughout the whole process, step by step, from an initial consultation to discuss your circumstances, plans and aspirations, right through to submitting an application and obtaining your certificate.
We can liaise with local estate agents to ensure you find suitable accommodation, and can help arrange your private medical insurance, as well as completing all necessary paperwork for the application for Category 2 status, and to apply for residency and obtain a Gibraltar identity card and driving licence.
We do not provide legal; tax or financial advice and we strongly recommend you obtain professional tax advice prior to application. We work in partnership with leading tax professionals and can help you procure this upon your request.
If you feel that Gibraltar Category 2 status may be of benefit to you and you wish to find out more, please contact Jean Shaw for an initial, no obligation discussion.