As the leading private client lawyers in Gibraltar, we have assisted countless high net worth individuals (HNWI) and their families to establish in Gibraltar. We are able to advise on everything our private clients need, including securing residency, transferring assets, taxes, permits, property, re-domiciling corporate vehicles and setting up trusts.
While we naturally focus on Gibraltar’s competitive legal and fiscal system, our expertise covers a broad range of jurisdictions. We are therefore able to create bespoke structures for private clients establishing trusts and companies both inside and outside of Gibraltar, if required. Our Gibraltar immigration team can assist on relevant issues for those looking to relocate/establish in Gibraltar
High Net Worth Individuals ( HNWI ), Re-domiciling and Trusts
Many of our clients choose Gibraltar as their home in order to benefit from a competitive tax regime and English common law. It is also an ideal trust location, as trusts established in Gibraltar enjoy tax-free status, provided they are set up by non-residents exclusively for the benefit of non-residents or people with High Net Worth Individual ( HNWI ) status.
Hassans’ fiduciary services are carried out through our subsidiary, Line Trust Corporation Limited. Our team is widely experienced in protecting the wealth of investors and entrepreneurs, both local and international. Hassans’ subsidiary, Line Trust Corporation Limited executes all the duties of a professional, licensed and regulated trustee.
We frequently advise clients on the best ways to manage and pass on their wealth.
Setting up a Family Office in Gibraltar
Setting up a family office is increasingly becoming a sine qua non for high net worth families, an indispensable component of the proper management of the family business and the family wealth.
Family businesses which thrive for several generations invariably have a family business governance framework in place. Each family is unique and every business is different. So too is every family business governance framework. This bespoke system seeks to unite the family and the business.
Category 2 Status
Hassans’ Private Client team can also assist High Net Worth Individuals (HNWIs) who wish to avail themselves of the various benefits of obtaining Category 2 status in Gibraltar.
In addition to the obvious benefits of reduced taxable liability, there are other advantages of attaining Category 2 (or “Cat 2”) status. For example, Cat 2 individuals are free to engage in economic activities (such as trade or business activities) within the jurisdiction provided the Finance Centre Director deems such activities to be of benefit to Gibraltar’s economy, though such activity will be subjected to local taxation.
There are also no legal requirements regarding how long an individual and his/her dependents must be physically resident within Gibraltar. It should be noted, however, that Category 2 status does not necessarily preclude an individual from being considered a tax resident of a different country. For this reason, we always recommend an initial consultation so we can assess your own specific needs and advise accordingly.
Our Spanish lawyers at the Hassans Sotogrande Office advise on Spanish property, income, capital gains, wealth and inheritance taxes for those clients planning to invest or undertake business in Spain.
They also advise on all aspects of Spanish residency. This includes giving advice on how to transfer assets and minimise tax liabilities, identifying suitable property to acquire or occupy, obtaining work and residency permits, relocating family, importing motor vehicles and compiling Gibraltar and/or Spanish wills.
Wherever necessary, they have access to an advisory network across Spain to assist with larger and more complex cross-border advice.
Structuring and management of portfolios
Our tax advice spans investments of all types. We have considerable experience in creating and managing large and complex structures for portfolios and transactions with values running into billions. In the case of private clients, we are particularly qualified to provide efficient tax and structuring advice tailored to the needs of our clients, their domicile and residence.
We take a practical view when advising clients, and ensure that the corporate, fund and trust structures that we recommend are always effective and viable.
As part of tax planning, we are able to advise and assist with tax residency and domicile issues. Below are some of the frequently asked questions relating to residency in Gibraltar.
- Is there a Wealth Tax in Gibraltar?
- What taxes do high net worth individuals pay in Gibraltar?
High Net Worth individuals are able to take advantage of Gibraltar’s Category 2 status to limit tax payable on their worldwide income. Currently, CAT2 individuals pay tax on a maximum of £118,000 of assessable income, subject to the payment of a minimum tax of £37,000 per qualifying year.
- What is Gibraltar's 'Category 2' tax status?
A special status which allows qualifying individuals to limit the amount of tax payable on worldwide income. Under Cat 2 rules, only the first £118,000 of assessable income is assessed to tax, subject to a minimum tax payable of £37,000.
- How do I qualify for Category 2 status in Gibraltar?
To qualify as a Category 2 individual, the applicant must be able to prove a minimum net worth of £2m, have approved accomodation in Gibraltar, and not have been resident in Gibraltar for five years prior to the application. The Cat 2 status is governed by the Qualifying (Category 2) Individuals Rules 2004
- How much tax do top level executives pay in Gibraltar?
High Executives Possessing Specialist Skills ‘HEPSS’ individuals who have had applications for HEPSS status approved will pay tax on exactly £160,000 of assessable income, under the Gross Income Based Scheme.
- How do I qualify for HEPSS status?
Established to attract talent and top flight executives to Gibraltar, the HEPSS regime requires the Finance Centre Director to be satisfied that the appointment of a HEPSS will ‘promote and sustain economic activity of a particular economic value to Gibraltar and that he/she will earn more than £160,000. It also requires the applicant to have available approved accomodation. Applicants cannot have been resident in Gibraltar for a period of three years prior to the application.
Our tax team offers tailored advice to private clients. As Gibraltar’s largest law firm, we have also played an active role in modernising Gibraltar’s tax laws, to ensure a wide range of tax planning opportunities. Some of the key questions relating to tax in Gibraltar are covered briefly below:
- What is the basis of taxation in Gibraltar?
Tax in Gibraltar is charged on income accruing in or derived from Gibraltar.
- What does ‘ordinarily resident’ mean in the context of Gibraltar Income Tax?
In the context of an individual, ‘ordinarily resident’ means an individual who irrespective of whether such individual is domiciled in Gibraltar or otherwise, in any year of assessment is present in Gibraltar for a period of at least 183 days in aggregate or is present in Gibraltar in excess of 300 days in three consecutive years. Non-resident means any person other than a person ordinarily resident.
- What is the rate of income tax in Gibraltar?
The effective rate of tax for taxpayers earning up to £50,000 is 27% (in response to Covid expenditure, a temporary additional 2% tax is payable for two years as from 1 July 2022). Visit our dedicated Gibraltar Tax information guide to get all the details.
- Do you pay tax on pensions in Gibraltar?
Pensions received from pension funds approved by the Commissioner of Income Tax shall be taxed at 0% in respect of individuals aged 60 or over (subject to exclusions applying to non-Gibraltarian Gibraltar residents not in possession of a CAT2/HEPSS certificate or in ‘true third party employment).
- Is estate duty payable in Gibraltar?
For further detailed coverage of Tax in Gibraltar please visit our detailed Tax information page or contact one of our people below who will be happy to assist.
Private Client Team
James Levy CBE KC
Peter Montegriffo KC
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