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Information on Category 2 Individuals taking up residency in Gibraltar
This Gibraltar Residency product is fast becoming a “demand” one with increasing rates of personal taxes (especially in the UK of 50% for the top bracket) as from April 2010, High Net-Worth individuals will be looking for residency options. Gibraltar is geographically situated perfectly with close proximity to Spain and the Algarve in Portugal therefore extending the advantageous choice as a residency jurisdiction over say others like, Guernsey, Malta, Monaco etc.
The Government of Gibraltar introduced low tax limits in order to encourage wealthy individuals to establish a residence in Gibraltar. Such individuals known as Qualifying (Category Two) Individuals will pay tax on the first £70,000 of assessable income only with a minimum tax payable per annum of £20,000 (as from 09/10) and a maximum of approx £26,000. Only income received or remitted to Gibraltar is taxable and therefore such individuals could still hold a Gibraltar low-tax company or deposits in their own name in a bank in Gibraltar, and the income from such companies or bank accounts would only be taxable if received by the individual for his own use in Gibraltar. Accordingly, the Individual is able to make full use of Gibraltar`s international financial centre whilst at the same time paying the prescribed low tax limits.
An application is made to the Finance Centre Director for the issue of a certificate under the Qualifying (Category Two) Individual Rules under the Income Tax Ordinance. A £1,000 non-refundable application fee (excluding professional fees) is payable and the application must be supported by two character references from recognised and established professionals (one must be from a bank and the other from a law or accountancy firm), a copy of his or her passport and a curriculum vitae.
In order for an individual to qualify as Qualifying (Category Two) Individual he must have approved residential accommodation available for his exclusive use in Gibraltar throughout the year.
Evidence of Wealth
The Government would also be looking to ensure that a Qualifying (Category Two) Individual has sufficient means to maintain himself and his family. They will therefore be looking for evidence of wealth of at least £2,000,000 although it is not necessary for the individual to declare his worldwide wealth or earnings. The Government would also be looking to ensure that the individual has private medical insurance to cover both him/herself and his/her family whilst residing in Gibraltar.
No Capital Gains Tax or Estate Duty
It is also interesting to note that there is no capital gains tax or estate duty in Gibraltar.