Budget Summary
The Chief Minister delivered his budget Address on 7 July 2026.
The key points to note are as follows:
15%
No changes to the existing corporate tax rate of 15%.
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The only personal tax measure announced was the introduction of a new allowance for fees earned by Gibraltar resident musicians from live performances, provided that the proceeds are reinvested in musical instruments or equipment. The measure applies retrospectively from July 2019.
The Chief Minister confirmed that the UK-EU Treaty relating to Gibraltar was expected to be signed on 14 July 2026 and provisionally applied from 15 July 2026. As part of the treaty’s implementation, Gibraltar will introduce significant changes to its indirect tax regime. Import duty, which has traditionally been a major source of government revenue, will be replaced by a new Transaction Tax. The rate will be set at 15% from 15 July 2026, increasing to 16% in 2027 and subsequently to a rate no lower than the lowest VAT rate applying in the European Union, currently 17%.
The treaty will also introduce new EU-aligned excise duty arrangements, including revised excise duties on tobacco products and other harmonised excise goods. In addition, a range of legislative and administrative measures will be implemented to give effect to the treaty, with the Government describing these changes as a key component of Gibraltar’s post-Brexit framework and future economic relationship with the EU.
Tax Facts 2026/2027
Chapter 1 Liability to taxation
Who is Liable to Taxation in Gibraltar?
Income tax is generally charged on income accruing in or derived from Gibraltar. Certain income arising, derived or received outside Gibraltar may also be taxable where the recipient is ordinarily resident in Gibraltar.
Gibraltar provides a number of preferential tax regimes for qualifying resident individuals which can limit their annual income tax liability, subject to specific eligibility requirements being met.
Individuals
An individual will generally be regarded as ordinarily resident in Gibraltar if they are present in Gibraltar for at least 183 days during a year of assessment, or for more than 300 days in aggregate over three consecutive years of assessment.
For these purposes, any part of a 24-hour period commencing at midnight during which the individual is present in Gibraltar is treated as a day of presence, regardless of whether accommodation in Gibraltar is used.
The Gibraltar tax year runs from 1 July to 30 June, and individuals are generally taxed on their actual taxable income arising during that year.
Individuals are assessed under both the Allowance Based System (ABS) and the Gross Income Based System (GIBS), with tax ultimately charged under the system that produces the lower liability.
Anti-avoidance provisions prevent members of the same family from combining the benefits of the two systems. For example, where one family member elects to be taxed under GIBS, another family member may be restricted from claiming certain allowances and reliefs, such as mortgage interest relief, under ABS.
The standard withholding tax rate applied to individuals taxed under the emergency tax code is 20%.
Companies
A company will be considered resident in Gibraltar if the management and control of its business is exercised from Gibraltar.
A company where the management and control is exercised outside Gibraltar by persons who are ordinarily resident in Gibraltar is also considered resident in Gibraltar.
The location of central management and control is determined in accordance with legal principles developed under United Kingdom case law. It refers to the place where the highest level of strategic control and direction over a company’s affairs is exercised, rather than where day-to-day operational decisions are made.
Companies are subject to Gibraltar taxation on income that accrues in or is derived from Gibraltar. Tax is charged on the taxable profits arising during the relevant financial year.
Income arising from an underlying activity that requires licensing and regulation under Gibraltar law, or from an activity licensed in another jurisdiction that benefits from passporting rights into Gibraltar, is deemed to accrue in and derive from Gibraltar.
Income that does not accrue in or derive from Gibraltar is generally not subject to Gibraltar tax. The concept of “accrued in and derived from Gibraltar” is determined by reference to the location of the activities that give rise to the profits.
Intercompany interest and royalty income received by a Gibraltar company is automatically deemed to accrue in and derive from Gibraltar and is therefore subject to Gibraltar taxation.
Pillar Two (Global Minimum Tax)
Gibraltar has implemented the OECD Pillar Two (GloBE) rules through the Global Minimum Tax Act 2024. The rules generally apply to multinational enterprise groups with consolidated annual revenues of at least €750 million in at least two of the preceding four fiscal years and impose a minimum effective tax rate of 15%. A Qualified Domestic Minimum Top-up Tax (QDMTT) applies to fiscal years beginning on or after 31 December 2023 and an Income Inclusion Rule (IIR) applies to fiscal years beginning on or after 31 December 2024. Gibraltar has not adopted an Undertaxed Profits Rule (UTPR).
Chapter 2 Income & Tax Treatment
Taxable income
Income tax is charged on:
- Gains or profits from any trade, business, profession or vocation;
- Gains or profits from employment including any allowances, perquisites or benefits in kind;
- Rents, premiums and any other profits arising from any interest in real property;
- Dividends;
- Interest;
- Royalties;
- Income received from pensions imported from abroad.
Profits derived from disposals of interests in residential property
From 1 January 2025, profits arising from the disposal of Gibraltar residential property may be subject to tax where a person directly or indirectly owns an interest in five or more taxable residential properties, or has held an aggregate interest in five or more such properties over five consecutive basis periods. The charge may also apply to profits arising on the disposal of shares in a property-holding entity that owns such properties.
The regime is targeted at persons carrying on significant property investment activities and includes anti-avoidance provisions that can attribute interests held by connected persons and treat certain transactions as disposals where one of the main purposes is to avoid tax. Certain mortgage enforcement sales, court-ordered sales and disposals by deceased estates are excluded.
The following categories of property are generally exempt from the regime:
- An individual’s primary residence in Gibraltar;
- Commercial property and properties used predominantly for commercial purposes;
- Hotels;
- Certain regulated, affordable or subsidised housing;
- Properties held by the Government of Gibraltar or statutory agencies for residential purposes;
- Properties constructed before and continuously owned since 1 January 1988;
- Retirement homes, care facilities and certain religious residences;
- Properties that are unfit for habitation or require substantial repair and are acquired for redevelopment, subject to approval by the Commissioner.
Dividends
Dividends received by a Gibraltar company from any other company are exempt from taxation in Gibraltar, irrespective of the jurisdiction in which the distributing company is incorporated.
Dividends paid by one Gibraltar company to another are not subject to Gibraltar tax. Similarly, dividends paid by a Gibraltar company to a person who is not resident in Gibraltar are not taxable in Gibraltar.
Dividends received by an ordinarily resident individual from a company are taxable in Gibraltar where the profits from which the dividend is paid were assessable to tax under the Income Tax Act.
Where a dividend, or part of a dividend, represents a distribution of profits that were not assessable to Gibraltar tax in the hands of the company that originally generated the income, such dividend (or the relevant portion thereof) is not taxable when received by an ordinarily resident individual.
Gibraltar does not impose withholding tax on dividends. However, companies declaring dividends are generally required to file a dividend return. Companies whose securities are listed on a recognised stock exchange are exempt from this filing requirement.
Interest
Interest and similar amounts received by a Gibraltar company are taxable where they are received by a person carrying on a money-lending business to the public, an authorised insurer, a licensed DLT provider, or a deposit-taking institution in respect of funds derived from its deposit-taking activities.
Interest received or receivable from an inter-company loan (regardless of whether the parties are connected) is also chargeable to tax, although an exemption applies where the annual interest does not exceed £100,000. Subject to these specific provisions, interest is generally not taxable in Gibraltar.
Royalties
Royalties received or receivable by a Gibraltar company are chargeable to tax.
Exempt Income
The main types of exempt income are summarised below:
- Interest from financial institutions and listed investments (excluding banks, money lenders, insurers and DLT companies, where such interest forms part of their trade);
- Dividends from companies listed on a recognised stock exchange;
- The income of a friendly society, sporting club, or ecclesiastical, charitable or educational institution or trust of a public character in so far as the income is not derived from a trade or business;
- Compensation for unfair dismissal and sums paid upon redundancy or retirement whichw have been approved as appropriate by the Commissioner;
- The investment income of any pension fund, provident fund or other fund established in Gibraltar, and approved by the Commissioner;
- The income received by any trust or beneficiary where the beneficiaries are all non-Gibraltar resident (this exemption also applies to Category 2 individuals;
- Any income arising from Gibraltar by an individual not resident in Gibraltar for a period of less than 30 days in a tax year;
- Pensions received from an approved occupational pension scheme by individuals aged 60 or over;
- Profits or gains derived by non-resident owners, charterers or operators of ships or aircraft from the carriage of passengers or cargo to or from Gibraltar;
- Income accruing to a life fund maintained by a life assurance company;
- Employment income earned by students during vacation periods, provided the employment is followed by a return to full-time education;
- Income received by individuals participating in a Government vocational training scheme approved by the Commissioner;
- Income received by community care officers aged between 60 and 65 years of age in respect of community work;
- Employer-paid medical insurance premiums under an approved scheme, up to £3,000 for taxpayers under the Gross Income Based System and £5,395 for taxpayers under the Allowance Based System; and
- Benefits in kind with an annual value not exceeding £250 per employee.
Chapter 3 Deductions, Allowances & Losses
- Deductions Allowed
- Capital Allowances
- Losses
- Training Costs
- Deduction for improvement in EPC rating
Deductions Allowed
Assessable income is calculated after deducting expenses and outgoings incurred wholly and exclusively in the production of income.
A number of tax incentives and statutory deductions are also available to eligible taxpayers.
Where a taxpayer earns both taxable and non-taxable income, allowable deductions are apportioned between the two on a pro rata basis.
The following expenses are generally not deductible for tax purposes:
- Expenses not incurred wholly and exclusively in the production of assessable income;
- Domestic or private expenditure. Expenditure of a capital nature;
- Any amount recoverable under an insurance policy or indemnity arrangement. Property-related expenses that are not incurred for the purpose of generating income;
- Any tax payable under the Income Tax Act. Depreciation of assets (although capital allowances may be available);
- Contributions to an employee pension scheme that has not been approved by the Commissioner of Income Tax;
- Interest paid other than on borrowings for the purposes of the trade or profession or acquiring the capital which generates the income for the trade or profession;
- General head office expenses incurred for the common purpose of the branch of the company which exceed 5% of turnover of the branch; and
- Certain business entertainment expenditure which does not qualify as deductible under the guidelines provided by the Commissioner of Income Tax.
Certain other expenses may also be disallowed under anti-avoidance provisions.
Capital Allowances
The first £30,000, of qualifying expenditure on plant and machinery (including fixtures and fittings) acquired in a year of assessment is fully deductible with the balance deductible at the rate of 15% per annum on a reducing balance basis.
The first £50,000 of qualifying expenditure on computer equipment (including software) is fully deductible and the remaining balance is deductible at the rate of 15% per annum on a reducing balance basis.
Expenditure on motor vehicles which does not qualify as plant and machinery and therefore benefit from a first year allowance but is deductible at the rate of 15% per annum on a reducing balance basis.
Expenditure on motor vehicles which does not qualify as plant and machinery does not benefit from a first year allowance but is deductible at the rate of 15% per annum on a reducing balance basis.
For unincorporated businesses and companies that are obliged to pay the higher rate of corporate tax, wear and tear allowances are 20% per annum on a reducing balance basis.
If the accounting period is less than 12 months, the pool allowance is apportioned by reference to time.
Where the balance of qualifying expenditure is less than £1,000, the full amount is allowed as a deduction in that year.
Capital allowances on the cost (excluding land) of hotels, mills, factories and other similar premises are deductible at the rate of 4% per annum on a straight line basis.
Newly established businesses are able to claim 100% of their eligible capital allowances in the first year of trading.
Losses
Trading losses may be carried forward and set against future taxable trading profits. Losses can only be relieved once and are only available where the corresponding profits would have been taxable in Gibraltar. There is no provision for carrying losses back.
For companies, losses may not be carried forward where, within a three-year period, there is both a change in ownership and a major change in the nature or conduct of the trade.
For accounting periods ending on or after 31 July 2024, regulated financial services businesses, gambling businesses and certain connected persons are generally restricted to utilising carried-forward losses against up to 50% of their taxable profits in any period. Transitional rules apply to losses incurred between 1 July 2021 and 30 June 2023.
Unrelieved trading losses may be transferred as part of a genuine group restructuring, including a reorganisation, merger, takeover or transfer of a business, provided there is no change in ultimate ownership and no major change in the nature or conduct of the business within three years of the transfer. Transferred losses may only be used against future profits of the transferred trade or business, and anti-avoidance provisions prevent the transfer of losses between different business activities.
Training Costs
Training costs for employees working towards a qualifying qualification are allowable as an expense at the rate of 150%.
Deduction for improvement in EPC rating
A deduction is available for the investment made by an individual, company or business that makes a significant improvement to the EPC rating. The amount of deductible expenditure is subject to the agreement of the Commissioner of Income Tax and the percentage deduction depends on the energy efficiency rating of the property.
Chapter 4 Reliefs, Withholdings & International Matters
0%
There is currently no group relief regime in Gibraltar. However, trading losses may be transferred within a group as part of a qualifying group restructuring, subject to certain conditions. The Gibraltar Government has announced a consultation process which will look at the introduction of group relief in Gibraltar.
0%
There is no withholding tax on interest, dividend or royalty payments.
25%
Payments made to a subcontractor without a valid certificate are subject to 25% withholding tax on that portion of the payment which is not for materials used in construction. The Gibraltar Government has announced a consultation process which will look to modernize this legislation.
0%
There is no VAT in Gibraltar.
Gibraltar does not impose VAT. Under the UK-EU Agreement in respect of Gibraltar, a Transaction Tax regime applies to most goods imported into, or manufactured for sale in, Gibraltar. The standard rate is 15%, increasing to 16% and then 17% during the transitional period, with reduced rates of 5% and 0% applying to certain categories of goods.
Excise duties are also levied on specified products, including alcohol, tobacco and fuel, with rates being progressively aligned with those applicable in Spain. Certain goods may also be subject to customs duties in accordance with the applicable treaty arrangements.
The following mechanisms for the exchange of information apply in Gibraltar:
- Bilateral Tax Information Exchange Agreements with a number of countries;
- The Directive on Administrative Cooperation.
- US FATCA.
- The Convention on Mutual Administrative Assistance in Tax Matters.
- The OECD Common Reporting Standard.
- Country by Country Reporting (“CBCR”). Where the Gibraltar entity is a member of a Multi National Enterprise (“MNE”) group which has consolidated turnover of over EUR 750 million, the Gibraltar entity must notify the Commissioner of Income Tax of the identity and jurisdiction of tax residence of the entity that will file the CBCR on behalf of its MNE group by nine months after the financial year end. Where the Gibraltar entity is the ultimate parent entity for the group or it is obliged to file a full CBCR, this filing must be made within 12 months of the financial year end.
- DAC 6 - Gibraltar has limited DAC6 Reporting scope whereby reporting is only applicable to cross-border arrangements falling within Category D hallmarks (CRS avoidance arrangements and opaque offshore structures). The Income Tax Act 2010 has been amended to reflect this change. However, the International Agreements on Taxation Matters (Spain) Regulations 2021 have introduced equivalent reporting requirements to DAC6 in relation to reportable cross-border arrangements involving Gibraltar and Spain. In practice this means that:
- For cross-border arrangements not involving Spain only Hallmark D needs to be considered for reporting purposes.
- For cross-border arrangements involving Spain, all Hallmarks (A-E) need to be considered for reporting purposes.
Chapter 5 Property Investments Incentives
Property Investment Incentives
Development aid: In order to encourage private development in Gibraltar, promoters and developers of approved projects are offered certain incentives such as tax relief, import duty relief and rates relief.
In order to qualify for the above reliefs, the project needs to be a new project the aim of which is:
- To create a tangible immovable asset in Gibraltar that will remain in existence after the applicant has ceased to derive the benefits under the licence; and
- To provide more than two additional units of housing accommodation in Gibraltar; or
- To contribute materially to the development of the tourist industry in Gibraltar; or
- To afford any new employment opportunities or career prospects in Gibraltar; or
- Otherwise, to improve materially the economic or financial infrastructure of Gibraltar; and
- The project shall be one which is for the economic benefit of Gibraltar
The project needs to be completed within a specified time (dependent on the type of project) following the issue of the license and the applicant must not expend less than the prescribed amount for the project. Application for development aid must be made to the Chief Minister or such other Minister as the Chief Minister designates.
Chapter 6 Tax Systems
Allowance Based System
Under the Allowance Based System the individual will be taxed on their income less allowances (see below) at the applicable rates:
Personal relief is granted on submission of a claim to the tax office when applying for a tax code upon registration. The main allowances (which are reduced by one twelfth for each complete calendar month that the individual is not resident in Gibraltar) for the tax year are as follows:
| Income | Allowance | |
| Personal allowance | £3,455 | |
| Spouse allowance | £3,455 | |
| One parent family | £5,800 | |
| Child allowance in respect of first child only | £1,1900 | |
| Child allowance in respect of each child educated abroad | £1,375 | |
| Disabled individuals | £10,000 | |
| Nursery school allowance in respect of each child attending | £5,480 | |
| Blind allowance | £5,475 | |
| Health insurance premiums | (i) | £5,395 |
| Life assurance premiums | (ii) | 100% |
| Pension’s contributions | (iii) | 100% |
| Mortgage interest | (iv) | 100% |
| House purchase for residential accommodation | (v) | £17,000 |
| Solar or wind energy systems | (vi) | £6,000 |
| Age allowance (state pensionable age - claiming spouse allowance) | £5,735 | |
| Age allowance (state pensionable age – not claiming spouse allowance) | £9,190 |
The minimum total allowances amount to £4,343.
i. Maximum relief. ii. Allowable premiums up to 1/7th of assessable income or 7% of capital sum assured. ii. Maximum relief will be equal to the lesser of 20% of the earned assessable income and £35,000 on contributions to a Personal Pension Scheme or Retirement Annuity Contract and 1/6th of the total assessable income in respect of contributions to an Occupational Pension Scheme. iv.Interest payable on a loan to acquire a Gibraltar property to be used as a taxpayer’s principal residence is allowable on loans up to a value of £350,000. v. One off allowance of £13,000 spread over a number of years and additional allowance of £4,000 restricted to a maximum of £1,000 per year. vi. One off allowance of £6,000 spread over two years
Persons whose taxable income does not exceed £11,450 per annum are exempt from tax.
Taper relief is available for individuals whose taxable income is between £11,451 and £19,500 per annum. There are also the following tax credits available:
- A tax credit equal to the higher of £300 or 2% of the tax payable for the year is available.
- A tax credit of up to £4,000 available for individuals aged 60 and over who are not in receipt of pension or annuity income in excess of £6,000.
Gross Income Based System
Under the Gross Income Based System the applicable tax rates are as follows:
Persons with gross income under £25,000
Persons with gross income over £25,000
Persons under the Gross Income Based System may also benefit from a deduction from their assessable income of:
- Up to a maximum of £1,500 per annum in respect of mortgage interest payments;
- Up to a maximum of £1,500 per annum in respect of mortgage interest payments;
- Up to a maximum of £5,000 per annum in respect of approved expenditure incurred on the enhancement of the frontage of their property;
- Up to a maximum of £7,500 per annum in respect of approved expenditure incurred towards the purchase of their home (this benefit is available to first time home buyers only and if purchase occurs on or after 1 July 2019);
- Up to a maximum of £3,000 per annum in respect of expenditure incurred towards private medical insurance premiums.
- Up to a maximum of £6,000 over two years in respect of expenditure incurred towards the installation of solar or wind energy systems.
Benefits in kind
Tax Incentives
- Category 2 (High Net Worth Individuals) (i)
- High Executive Possessing Specialist Skills (‘’HEPSS’’)
Category 2 (High Net Worth Individuals) (i)
Requirements:
Approved residential accommodation.
Non Gibraltar resident for the five years preceding the application.
Minimum of £5 million net assets.
Tax per annum:
Minimum of £37,000
Maximum £42,380
i. The tax shelter does not extend to any income from a trade, business, profession, vocation or employment in Gibraltar which is assessable to tax under the provisions of the Act
High Executive Possessing Specialist Skills (‘’HEPSS’’)
Requirements
Approved residential accommodation.
Non Gibraltar resident for three years preceding the application.
Minimum annual salary requirement of £160,000.
Possess skills not available in Gibraltar which are necessary to promote and sustain economic activity of particular economic value.
Tax per annum:
£39,940
Chapter 7 Contributions & Pensions
Social Insurance Contributions
Social insurance contributions are payable by every employee or self-employed person in any week in which they work as follows:
| Gross Earnings | Peer Week/Month Minimum | Maximum | |
| Employee (From 1 July 2026) |
10% | £14.34/£62.11 | £40.79/£176.76 |
| Employer (From 1 July 2026) |
18% | £31.98/£138.55 | £56.22/£243.65 |
| Self-employed (From 1 July 2026) |
20% | £30.45/£131.95 | £53.55/£232.05 |
Individuals aged 60 and over and those whose statutory occupational retirement age is earlier than 60, as in the case of a fire officer, police officer, prison officer or a member of the Royal Gibraltar Regiment and are in insurable employment shall be exempt from paying the employee’s share of social insurance contributions. Employers will continue to be required to pay their share of the contribution.
There is an exemption from employers’ and employees’ social insurance contributions in respect of an employee’s secondary employment. This is subject to the full contribution having been paid in Gibraltar. There is also an exemption from social insurance for student’s income from employment or vocation which is followed by full time employment. A credit in respect of employers’ social insurance contributions is available to businesses with 10 employees or less of £100 per employee.
This is increased to 20 employees for new businesses within the first year of operation. There is also an exemption from both the payment of employer and employee social insurance contributions in the case of payments received whilst on maternity leave.
Pension Schemes
Occupational pension schemes
Tax relief is available in respect of contributions to approved occupational pension schemes. The aggregate of employer and employee contributions qualifying for relief is generally limited to 25% of earned income.
Personal pension schemes and retirement annuity contracts
Tax relief for contributions to approved personal pension schemes and retirement annuity contracts is limited to the lower of 20% of earned income and £35,000 per annum.
Employees may claim relief for contributions to an approved pension scheme of up to one-sixth of earned income, inclusive of premiums paid under approved life assurance policies, which are subject to a separate limit of one-seventh of earned income. Unused relief on contributions to approved personal pension schemes or retirement annuity contracts may be carried back for one year.
Taxation of pension benefits
Pensions received from approved occupational pension schemes are exempt from Gibraltar tax where the recipient is aged 60 or over or has been compulsorily retired at age 55 under section 8(2) of the Pensions Act.
Pension benefits received from a QROPS are taxable in Gibraltar at a rate of 2.5%, to the extent they form part of the individual’s taxable income.
Chapter 8 Anti-avoidance Provisions
Gibraltar’s tax legislation contains a general anti-avoidance rule under which the Commissioner may counteract or disregard arrangements where obtaining a tax advantage is the main purpose, or one of the main purposes, of the arrangement and the outcome is inconsistent with the intent of the legislation. The Commissioner may apply a substance-over-form approach in determining the tax consequences of an arrangement.
Promoters of tax planning arrangements that result in a reduction of tax payable must notify the Commissioner within 30 days.
The Act also contains specific anti-avoidance provisions as follows:
15%
An exit tax at the rate of 15% may be applicable in a number of defined circumstances when assets are transferred from Gibraltar, or a taxpayer transfers its tax residence outside of Gibraltar. The exit tax is calculated based on the market value of the assets at the time of their transfer from Gibraltar less their value for tax purposes.
Interest paid on a loan by a company to related parties (which are not themselves a company) or loans where security is provided by related parties, where the ratio of the value of the loan capital to the equity of the company exceeds 5 to 1 is considered as a dividend payment and thus not a deductible expense for tax purposes.
The amount of interest payments to connected persons which is in excess of that payable at “arm’s length” is deemed to be a dividend. Also, if the amount charged for goods and services by the connected persons is not at “arm’s length” expenses allowed are subject to a maximum of:
(i) the expense
(ii) 5% of the gross turnover of the company
or (iii) 75% of the pre expenses profit of the company
Any interest paid or payable to a person not resident in Gibraltar is not deductible insofar as the interest is at more than a reasonable commercial rate. Any interest paid on any money borrowed other than for the purposes of the trade or profession, is also not deductible. Where the interest income is not taxable the interest expense is not deductible on back-to-back loans
Income from dual employment contracts is taxed in Gibraltar where the two employers are connected persons. Bona fide arrangements where the purpose is not to avoid tax is a defence to the provision.
Where assets are transferred abroad with the purpose of avoiding taxation and the taxpayer has the power to enjoy these assets either now or in the future, then any income or benefits received from these assets will be deemed to be income chargeable to tax. This provision does not apply if the transaction is bona fide and not designed for the purpose of avoiding tax.
The interest limitation rule provides that exceeding interest expenses are deductible up to the greater of
(i) 30% of EBTDA
and (ii) EUR 3 million
Note that there are exceptions to the rules which may provide for a greater interest deduction based on either group ratio or equity ratio calculations.
The rule attributes to a Gibraltar company the undistributed profits of a foreign company where the Gibraltar company holds at least 50% of the voting rights, capital or entitlement to profits and the foreign company is subject to an effective level of taxation that is less than 50% of the tax that would have been payable in Gibraltar. The rule applies to profits arising from non-genuine arrangements designed to obtain a tax advantage.
Payments under hybrid instruments and payments to associated hybrid entities will be disregarded where the deduction or payment benefits from a tax deduction in the payer jurisdiction and is not taxed in the jurisdiction where the payment is received.
Chapter 9 Other Taxes & Duties
Double Taxation Relief
Any person ordinarily resident in Gibraltar who is liable to pay tax in Gibraltar in respect of income also taxed abroad is able to claim double taxation relief in respect of the tax paid abroad.
On furnishing evidence of the payment made abroad, the claimant is entitled to a credit equivalent to the lesser of the:
- Tax payable on that income in Gibraltar; or
- Tax payable or paid abroad in respect of the same income.
If relief from the double taxation has to be made abroad, the relief then given is reduced accordingly.
A claim for double taxation relief has to be made within six years after the end of the year of assessment to which it relates. The time limit is extended where any adjustment or assessment made in Gibraltar or abroad renders any relief previously given excessive or insufficient. In those circumstances, a claim must be made within the six years after the adjustment or assessment.
Capital Gains Tax
0%
Gibraltar does not impose capital gains tax. Whether a profit is capital or revenue in nature is determined by reference to established case law principles.
Wealth Tax
0%
There is no wealth tax in Gibraltar.
Estate Duty
0%
There is no state duty in Gibraltar.
Rates
General rates are levied on most properties in Gibraltar.
Certain categories of residential property, including qualifying affordable housing developments, may benefit from rates concessions or reliefs in accordance with the applicable legislation and Government housing schemes.
Stamp Duty
Stamp duty is payable on the transfer or sale of any Gibraltar real estate or shares in a company owning Gibraltar real estate (on an amount based on the market value of the real estate) at the following rates:
| Consideration | Requirements |
| £200,000 or less | 0% |
| £200,001 to £350,000 | 2% on first £250,000 and 5.5% |
| Over £350,001 to £800,000 | 3% on first £350,000 and 3.5% on balance |
| Over £800,000 | 3% on the first £350,000 and 3.5% on the next £450,000 and 4.5% on balance |
Stamp duty is also payable on mortgages secured on Gibraltar real estate at the following rates:
| Mortgage | % Value of Mortgage |
| £200,000 or less | 0.13% |
| Over £200,000 | 0.20% |
For first and second-time buyers, no stamp duty is payable on the first £300,000 of the purchase price. Transfers of property between spouses are exempt from stamp duty.
On affordable housing estates developed by Government:
-No stamp duty is payable on the initial purchase of the property.
-A special stamp duty rate of 7.5% applies to the sale of affordable housing within the first 10 years of acquisition, subject to certain exemptions, including divorce and approved upgrades to larger Government affordable housing properties.
Chapter 10 Compliance & Administration
Penalties and Surcharges
Late payment surcharges
For late payment of tax, there is a penalty of 10% of the amount of tax due on the day immediately after such payment was due. If unpaid for 90 days a further amount of 20% of the tax due is charged.
Late filing - Individuals and trusts
Failure to file a return by the due date will result in a penalty of £50 with a further penalty of £300/£500 if the return is not submitted within three months/ six months after the due date.
Companies
For companies the late filing penalties are based on the size of companies as defined in the Companies Act 2014:
| After Due Date | 3 Months After Due Date | 6 Months After Due Date | |
| Micro/Small | £100 | £450 | £750 |
| Medium | £750 | £1,250 | £2,000 |
| Large | £1,500 | £3,500 | £5,000 |
Failure to file a return or for fraudulently, recklessly or negligently delivering to the Commissioner an incorrect return, accounts or information will be liable to a penalty of up to 150% of the difference between the actual tax due and the tax due as per the original declaration, if any.
The amount of the penalty will depend on:
- The amount of the tax lost and/or delayed;
- The gravity of the offence, if deliberate or an honest mistake; and
- The level of cooperation in the investigation.
Failure to respond to a notice or request to submit information or documentation within 30 days will result in a fine of £200 on the day the failure occurs and a penalty of up to £500 per day thereafter.
Failure to comply beyond a three month period, if convicted, can result in imprisonment.
Failure to pay to the Commissioner PAYE or social insurance which has been withheld/should have been withheld is a criminal offence which can lead to imprisonment and/or a fine. If an amount of PAYE and/or social insurance exceeding £5,000 is outstanding for over three months the Commissioner will, after giving 14 days’ notice, publish in the Gibraltar Gazette the name of the person whom he has reason to believe has failed to comply with the PAYE Regulations.
Failure to notify the Commissioner of an arrangement the main benefit of which is to avoid the payment of tax will result in a fine of £100 on the day the failure occurs and a penalty of £200 per day thereafter.
Historical Tax Rates
Corporate
The corporate tax rate is 15%. This increased from 12.5% on 1 July 2024. In 2022/23 the rate increased from 10% to 12.5% effective in 1 August 2021.
Utility and energy providers and companies that abuse a dominant position pay a higher rate of 20%.
| 2026/27 | 2025/26 | 2024/25 | 2023/24 | 2022/23 | |
| Corporate Tax Rate | 15% | 15% | 15% | 12.5% | 12.5% |
Personal
Allowance Based System - Rates
Less than £100,000 gross assessable income
| 2026/27 | 2025/26 | 2024/25 | 2023/24 | 2022/23 | |
| 4,000 | 14% | 14% | 14% | 15% | 16% |
| 12,000 | 17% | 17% | 17% | 18% | 19% |
| Balance | 39% | 39% | 39% | 40% | 41% |
More than £100,000 gross assessable income
| 2026/27 | 2025/26 | 2024/25 | 2023/24 | 2022/23 | |
| 4,000 | 14% | 14% | 14% | 16% | 16% |
| 12,000 | 17% | 17% | 17% | 19% | 19% |
| Balance | 39% | 39% | 39% | 41% | 41% |
A tax credit is available equal to the higher of £300 or 2% of the tax payable for the year.
Personal
Allowance Based System - Allowances
| 2026/27 | 2025/26 | 2024/25 | 2023/24 | 2022/23 | |
| Personal Allowance | 3,455 | 3,455 | 3,455 | 3,455 | 3,455 |
| Spouse Allowance | 3,455 | 3,455 | 3,455 | 3,455 | 3,455 |
| One Parent Family | 5,800 | 5,800 | 5,800 | 5,800 | 5,800 |
| Child Allowance | 1,190 | 1,190 | 1,190 | 1,190 | 1,190 |
| Child Educated Abroad | 1,375 | 1,375 | 1,375 | 1,375 | 1,375 |
| Disabled Individuals | 10,000 | 10,000 | 10,000 | 10,000 | 10,000 |
| Nursery School Allowance (per child) | 5,480 | 5,480 | 5,480 | 5,480 | 5,480 |
| Blind Allowance | 5,475 | 5,475 | 5,475 | 5,475 | 5,475 |
| Health Insurance Premiums | 5,395 | 5,395 | 5,395 | 5,395 | 5,395 |
| House Purchase Allowance | 17,000 | 17,000 | 17,000 | 17,000 | 17,000 |
| Age Allowance (state pensionable age - claiming spouse allowance) | 5,735 | 5,735 | 5,735 | 5,735 | 5,735 |
| Age Allowance (state pensionable age - not claiming spouse allowance) | 9,190 | 9,190 | 9,190 | 9,190 | 9,190 |
Minimum total allowances amount to £4,343. Individuals 60 years and over not in receipt of income exceeding £6,000 per annum in respect of an occupational pension/annuity are eligible for a £4,000 tax credit.
Gross Income Based System - Rates
Gross Assessable Income below £25,000
| 2026/27 | 2025/26 | 2024/25 | 2023/24 | 2022/23 | |
| 10,000 | 6% | 6% | 6% | 7% | 8% |
| 7,000 | 20% | 20% | 20% | 21% | 22% |
| Balance | 28% | 28% | 28% | 29% | 30% |
Gross Assessable Income above £25,000 but less than £100,000
| 2026/27 | 2025/26 | 2024/25 | 2023/24 | 2022/23 | |
| 17,000 | 16% | 16% | 16% | 17% | 18% |
| 8,000 | 19% | 19% | 19% | 20% | 21% |
| 15,000 | 25% | 25% | 25% | 26% | 27% |
| Balance | 28% | 28% | 28% | 29% | 30% |
Gross Assessable Income more than £100,000
| 2026/27 | 2025/26 | 2024/25 | 2023/24 | 2022/23 | |
| 17,000 | 16% | 16% | 16% | 18% | 18% |
| 8,000 | 19% | 19% | 19% | 21% | 21% |
| 15,000 | 25% | 25% | 25% | 27% | 27% |
| 65,000 | 28% | 28% | 28% | 30% | 30% |
| Balance | 25% | 25% | 25% | 27% | 27% |
