The Gibraltar Government has recently revised the legislation relating to "High Net Worth Individuals" establishing tax residency on The Rock. Originally introduced in 1992 and revised in recent legislation known as the Qualifying (Category 2) Individuals Rules 1999.

What is High Net Worth Status?

This status was introduced by the Gibraltar Government in 1992 through the introduction of low tax limits for wealthy individuals who wish to establish a residence in Gibraltar. Any wealthy individual especially those who are currently residents of high tax jurisdictions such as United Kingdom, Germany, Switzerland, Ireland and France can apply for this status.

What are the advantages of becoming a High Net Worth Individual (HNWI)?

• Only income remitted to Gibraltar is taxable.
• In essence tax will only be paid on the first £60,000 of assessable income.
• Minimum tax payable per annum is £20,000.
• An option can be exercised before the termination of the year of assessment whereby the HNWI advises the Commissioner of Income Tax that he/she shall be deemed to have taxable income in Gibraltar of £60,000 even if the income remitted is less than that amount. The advantage of this option is that no tax return will need to be made to the Gibraltar Tax Authorities and as a consequence the tax payable will be £21,880.
• It is in certain circumstances possible for a HNWI to transfer their pension scheme to Gibraltar and as a result make considerable tax savings.
• Full use can be made of Gibraltar’s Offshore Financial Centre.
• No Capital Gains Tax or Estate Duty is payable.
• No minimum residential requirement in Gibraltar in any year of assessment.

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