Gibraltar taxation

Non-resident company

Gibraltar non-resident company is not taxable in Gibraltar. It is a company, which is incorporated in Gibraltar, owned by non-residents and controlled by directors who reside and hold board meetings outside Gibraltar.

Non-resident company is another offshore business form which escapes taxation on foreign income. The Companies Taxation and Concessions Ordinance (amended) introduced the territorial scope of taxation, status for companies trading outside Gibraltar. A company registered in Gibraltar will not be liable to Gibraltar taxation, including income tax and estate duty, if it’s owned and controlled by non-residents of Gibraltar, does not trade in Gibraltar and does not remit income to Gibraltar.

Detailed features

Often it would be just a different offshore jurisdiction – like, Isle of Man, for example. It may also be practical to open the offshore bank account in a country situated closer to the place of the actual business of the company – or to the actual location of its beneficial owners.

If the above criteria is satisfied, a Gibraltar company will be considered “non-resident”. As such, it will not fall under the Gibraltar tax system by definition and will not be required to register for Gibraltar taxation purposes. This also means that, unlike the tax-exempt company, the non-resident company can in no circumstances be considered as a Gibraltar taxpayer.

Types of entities in Gibraltar

General and Limited Partnership

General Partnership

The general partnership is created by partners equally responsible for the business’ responsibilities and duties with their own contributions. The maximum number of partners in a Gibraltar partnership cannot exceed 25 individuals or companies (not available for professional firms). Even though annual accounts must be submitted to the Commissioner of Income Tax, the general partners are not obliged to fill agreements and financial accounts.

Limited Partnership

The limited partnership is formed by at least one general partner, fully liable for the company’s debts and a silent partner, liable only in the extent of his contributions. The major difference between the two types of partners is that the silent partner may not make managerial decisions. The partners must file a declaration regarding the composition of the partnership and the amount of capital deposited by the limited partners and submits it at the Registrar of Companies.

All types of partnerships are regulated by the Partnership Act (as updated). The companies are regulated by the Companies Ordinance, pretty similar with the English Companies Act 1929.

Private and Public Limited Liability companies

The private limited liability company may be limited by shares or by guarantees.

Private limited liability by shares

The companies limited by shares’ capital is made of non-transferable shares and the responsibility for the company’s liabilities depends on the contributions to the share capital. The minimum number of shareholders in such a company is 2 and the maximum is 50. The management is assured by a director and the secretary appointment is not necessary.

Companies limited by guarantee

The companies limited by guarantee with or without share capital have members which have their liability guaranteed by a deposited sum of money and their members don’t need to register with the Companies Registrar (unlike the previous type of company, where details regarding their names and contribution to the capital were necessary).

Public limited liability

The public limited liability companies are founded by an unlimited number of shareholders and, as a particularity, a minimum share capital has to be deposited at incorporation, with the total amount of 20,500 GIP.

E-commerce

Gibraltar as a European jurisdiction of choice

A few surprising remarks:

Competitive tax environment

In addition, Gibraltar has favourable tax systems including competitive corporate tax rates, an attractive structure for cross-border dividend distributions and no capital gains tax or value added tax (VAT).