Cat 2 Gibraltar

Gibraltar Category 2 status  for High net worth individuals (HNWI)

Category 2 for HNWI can ensure your wealth is preserved in a tax efficient jurisdiction & to qualify you would require the following:

  • Individual must be of substantial and sound financial standing and have a minimum net worth of £2 million
  • A property must either be owned or rented as an approved residential accommodation in Gibraltar. Approval by the Gibraltar Finance Centre is required and must be used exclusively by the Category 2 individual and his direct family. Direct family includes spouse, children, brother, sister, parents & spouse’s parents. The Category 2 individual cannot rent the property and is limited to occasionally allowing others to stay there, otherwise he will not be deemed to have “exclusive use” and would consequently lose the Category 2 status.
  • Potential Category 2 individuals must not have been resident in Gibraltar during the five years prior to assessment. Previous residency includes having been resident in Gibraltar 183 days in any tax year during the previous 5 years or an average of 90 days in any three of the previous 5 years.
  • A Category 2 individual is not allowed to engage in a trade, business or employment in Gibraltar. Exceptions to this rule include where duties are incidental to a business outside of Gibraltar or the Category 2 resident is a director of a Gibraltar Exempt Company or a director of a Company which does not transact any trade or business in Gibraltar. The Gibraltar Finance Centre has issued guidelines in the form of a circular confirming the list of permissible activities that a Category 2 individual may in principle carry out. In addition to this, it is also possible to apply for a ruling to determine whether proposed activities would contravene the Category 2 rules.
  • Status is granted on an indefinite basis, but the Category 2 residency certificate needs to be sent to the Gibraltar Finance Centre for endorsement every three years.
  • Private medical cover is required in Gibraltar, we work with specialist providers that can quote for this.
  • No minimum stay in Gibraltar is required for a Category 2 resident individual. Providing all the terms above are satisfied the Category 2 status will be retained without the need to spend any time in Gibraltar.
  • INDEPENDENT PROFESSIONAL ADVICE IS REQUIRED & WE CAN ARRANGE FOR YOU TO CONSULT WITH ONE OF OUR PARTNERED LOCAL, LICENCED LAW FIRMS

Personal tax is capped & calculated based on a total income of £80,000, but the capped amount varies from year to year due to changes in the tax band. This current tax year 2015/16 calculation is as follows:

£4,000 x 14% =

£560

£12,000 x 17% =

£2040

£64,000 x 39% =

£24,960

Total tax payable

£27,560

f the Category 2 individual has no source of income deriving from Gibraltar then the individual would pay the minimum tax of £22,000pa (2015/16)

There is no Capital Gains Tax (CGT), Wealth Tax, Inheritance Tax (IHT) or local Sales Tax/VAT in Gibraltar.

Contact Strategic Wealth Limited today and see how we can help with your Cat2 in Gibraltar status.