On 1 January 2016, Gibraltar’s income tax laws changed. These changes affect all Gibraltar registered companies.
Gibraltar is a popular financial destination for an eclectic mix of international individuals, families and many others, who want to achieve their financial and business objectives. They understand the importance of tax and succession planning and protecting their assets from unexpected events
Towards the end of last year, the Income Tax (Amendment) Act 2015 was enacted. This legislation amends the Income Tax Act 2010 (“the Act”) in a number of areas most notably the tax filing requirements for companies. The change took effect on 1 January 2016.
Previously, a company was only required to file a tax return and accounts if it had income assessable to tax in Gibraltar. The Act now extends the annual filing requirements to every company that is registered in Gibraltar. This includes the filing of accounts, even where the company has no income.
The filings must be done within nine months of the company’s financial year-end.
Europa Trust Company will be offering this service as a supplement to its management services.
Income accrued in or derived from Gibraltar will attract 10% corporation tax. Income from elsewhere will not suffer corporation tax and a “nil” tax return may be filed.
For your peace of mind, we can request a Tax Ruling from the Commissioner of Income Tax regarding your company’s possible tax liability.
There are several advantages to filing tax returns. The company will be issued with a Tax Identification Number (TIN), which is particularly useful for trading companies when opening a bank account, making an investment or demonstrating to trading partners or the authorities that the company is registered for tax purposes.
Gibraltar has become one of the most compliant and best jurisdictions for registering a company. The most notable advantages are:
- No tax on profits; A Gibraltar Company conducting profit-making activity outside of Gibraltar will not suffer tax on its profits.
- Low tax-rate of 10%. Only profits accrued in or derived from Gibraltar will attract corporate tax.
- Stable financial centre. Gibraltar has a stable Government and has in place Banking, Insurance and Companies Acts as well as a Financial Services Act.
- Gibraltar has signed the equivalent of 135 Tax Information Exchange Agreements (TIEAs) with over 80 jurisdictions around the world, removing any “tax-haven” stigma.
- Excellent regulation of company managers. Trust and Company Managers must be authorised and are regulated by a supportive Financial Services Commission.
- There is no VAT in Gibraltar; therefore VAT is not an issue from a Gibraltar tax perspective.
- Goods imported into Gibraltar are subject to import duty at the rate of 0%, 6% or 12%.
- Gaming Tax (On-line Gaming) Levied at the rate of 1% of relevant income capped at £425,000 and with a minimum payable of £85,000, per licence, per annum.
- Discounts for early payment of rates for businesses. There are generally from 10% to 20%.
- New start-ups benefit from a 50% discount in rates in their 1st year of trading, and 25% for the 2nd year.
- Wear and tear allowances are 20% per annum on a reducing balance basis for companies that pay a higher rate of corporate tax.
- Tax and residential benefits in Gibraltar for high net worth individuals and High Executives possessing specialist skills.
- 30% standard rate of tax for individuals and trusts.
- Tax relief on contributions to an approved Pension scheme of up to 1/6th of employees earned income. Overall employer and employee contributions are eligible for tax relief of up to 25% of earned income.
- Ability to claim double taxation relief in respect of the tax paid abroad if a person is resident and liable to pay tax in Gibraltar in respect of income also taxed abroad.
- There is no capital gains tax, wealth tax or estate duty in Gibraltar.
- For employees in Gibraltar, collection of tax is initially through a Pay As You Earn (“PAYE”) system.
Working with Europa Trust Company Ltd
Europa Trust Company Ltd, part of the Europa Group, has been based in Gibraltar for 30 years and has built a reputation as a stable and reputable business.
We provide a comprehensive range of company and trust formation and management services including company and trust administration, corporate directors, shareholders and secretaries, accounting, marine registration and other associated services.
Europa Trust Company Ltd is able to work in over 31 jurisdictions around the World.
We are licensed and regulated by the Financial Services Commission and ISO 27001 (Information Security Management Systems) and ISO 9001 (Quality Management Systems) certified.
Contact us today to find out how we can help you.