Gibraltar has been an attractive jurisdiction for companies looking to take advantage of its low-tax regime and exceptional telecommunications infrastructure. The financial services and technologies sectors are growing at a rapid rate. With the economy experiencing superior stability with promising growth and huge returns in the future, it is not surprising that foreign investors flock Gibraltar to expand their opportunities. Gibraltar is an appealing jurisdiction with excellent benefits of being based in Europe. It adheres to strong compliance procedures that boost its reputation as a safe and secure destination for international corporate entities and private investors alike. Here is a comprehensive list of steps on how to do business in Gibraltar.

Why do business in Gibraltar? 

• You can conduct your business in a premier, low-tax jurisdiction that features low corporate tax rate. 
• It has stable currency with only a few restrictions in moving capital and repatriation of dividends, 
• Gibraltar features a legal system fashioned on the English structure, making it a highly regulated, globally recognized jurisdiction. 
• Offers start-up incentives, including a start-up rate of 10% applicable to any type of business established in Gibraltar after 1 July 2009. 
• Holds EU membership benefits. 
• Features a highly-skilled, qualified workforce, providing ongoing training assistance to further enhance the skills, whenever needed. 
• Prevailing legislations encourage high-net-worth individuals and high executives possessing specialists skills to establish their respective tax residency in Gibraltar. This affords them the chance to enjoy tax-payable on their incomes restricted to a pre-determined tax amount. 

Company Formation in Gibraltar

• A company must have its own registered office. 
• A company must have its own appointed resident secretary that can file official paperwork and documentations to the government. 
• A company must provide all the necessary information related to its activities. Certain details need to be provided to a registered agent or secretary, including copies of bank statements under the name of the company, entered agreement specifics, and many more
• A company must have a minimum share capital of GBP 100. 

Bank Account Opening Compliance to EU Anti-Money Laundering Due Diligence Requirements Prior to Gibraltar Company Formation 

• A company must submit a certified copy of passports of all its directors, ultimate beneficial owners, bank official, bank signatories, and other officially registered natural persons. 
• Verification of current address through the submission of an original certified copy of utility bills in the last three months. 
• An original copy of reference letter from a registered professional, such as a lawyer, accountant, or bank. 
• Curriculum vitae, if available 

Different Types of Gibraltar Company Structure

The Gibraltar Companies Ordinance (1967) is based off of the United Kingdom Companies Act of 1929 and the Companies Ordinance of 1984. 

Sole Traders

• The quickest type of business structure to set up is a sole sole trade company. 
• The formation process involves registration as a self-employed individual at the Gibraltar Income Tax Office and Employment Service offices. Sole trades can set up a business name before the Companies House even before the registration process. 
• Once registration formalities are completed, the sole trader can immediately start work, provided all required licenses are obtained.
• Sole trader companies are taxed as individuals and is deemed to pay personal income tax. 
• Business income and any losses declared must be placed on the personal tax return form. 

Partnerships

• Consisting of two or more people or legal entities that carry self-employed status. 
• Each of the partners will receive a percentage of the company profits and are liable for any debts incurred by the company. 
• A partnership must be dissolved if one of the partners leaves, dies, or goes bankrupt. 
• This corporate structure is simple and flexible for individuals that want to set up a business as partners.
• There is little protection in the event of business failure or loss. 

Limited Liability Partnership (LLP)

• While the Limited Liability Partnerships shares similarities with a partnership company structure, the main difference lies in the number of people that share the costs and risks of operating the business. 
• Partners in a limited liability partnership structure are not liable for another partner’s negligence. 
• Liability is limited to the total share that each partner invested in the company. 
• Setting-up a limited liability partnership in Gibraltar involves registration with the Employment Service, Income Tax Office, and Companies House. 

Companies

• There are several requirements and costs that are involved during a limited company incorporation in Gibraltar.
• Although not compulsory, it is recommended to seek professional assistance in the company formation. 
• To incorporate a company in Gibraltar, it must be a company limited by shares, limited by guarantee with or without share capital, or an unlimited company with or without share capital. 
• Minimum number of shareholders in a Gibraltar limited company is one, while public companies must have a minimum of seven shareholders. 
• All companies registered in Gibraltar must have a registered, physical office. 

Other forms of company structure in Gibraltar including trusts, non-profit organizations, and protected cell companies. 

Gibraltar Business Name Certificate

• Anyone doing business with a name separate from their own name must be duly registered with the Gibraltar Companies House. 
• The name must be available and approved before successful registration. 
• A company must be unique and cannot be a duplicate of another company incorporated in Gibraltar. 
• A name must be registered and paid in full in order to receive a Certificate of Registration of a Business. 

Taxation Regime in Gibraltar

• Gibraltar laws are based on English law, but is a completely separate entity from the UK Legal System. 
• Companies owned by non-residents are not assessed with income tax unless the source of income is in Gibraltar. 
• There is no tax on capital income in Gibraltar. 
• Other tax benefits available to non-resident companies in Gibraltar, including no capital gains tax, no wealth tax, no sales tax, and no value added tax. 
• The primary tax levied in Gibraltar is corporation tax at 12.5% and social insurance contributions . 
• There are also stamp duties and property taxes on certain transactions. 

By rule, a non-resident company is exempt from paying taxes if they satisfy any of the following conditions:

• Owned by a non-resident
• If the directors reside and hold meetings outside of Gibraltar. 
• If the company does not operate commercially or trade with residents and companies in Gibraltar. 

Gibraltar Company Name Registration 

• When choosing a company name for a Gibraltar company, all words within the name must be in English. 
• The company name must be unique and must end with either Limited or its abbreviation, LTD. 

Directors, Shareholders, and Secretary for Gibraltar Company

• There should be at least one director, one shareholder, and one secretary is required for a Gibraltar company. These personnel can be located anywhere in the world. 
• A Gibraltar company is required to have at least one director. 
• If one of the directors is also a shareholder, a different secretary must be appointed for the company.
• The name of directors and shareholders will be published. 
• A Gibraltar company with more than three offices will be assessed with additional compliance fee. 
• There must be at least one shareholder, which can be a natural person or corporate entity of any nationality. 
• In case a company does not want to publicly share the name of its shareholders, nominee services are available to reinforce privacy and confidentiality. 
• The Company Register serves as a public registry of a company’s shareholders. 

Share Capital 

• Standard currency and value of minimum capital for a Gibraltar company is GBP 1 while share capital is set at 1 share worth GBP 1.000 each. The standard share capital amount is GBP 2,000 to be paid upon incorporation. 
• Any capital duty over GBP 2,000 is at 0.5%.
• Company founders can add a certain number of shares within the company, with the ability to allocate a certain number of shares to each shareholder. For instance, a company can only allocate 100 out of the 2,000 shares that it holds. The remainder will be treated as floating shares. 
• A company can have registered shares, shares with and without voting rights, bearer shares, redeemable shares, preference shares, and shares with or without value. 

Annual General Meeting

• An annual general meeting is not a requirement and can be held anywhere in the world except in Gibraltar. 

Auditing Requirements

All Gibraltar non-resident companies must file audited accounts annually, except for a company that is categorized as a small company. 

Annual Reporting 

• An annual reporting of a non-resident company must be filed before the Register of Companies in Gibraltar. 
• The first return must be filed within its first 16 months, and every year moving forward. 
• Financial systems that a company must report include its balance sheet and file a profit or loss report. 
• A small company is not required to prepare, maintain, and file accounting records. 
• Small companies are those that meet the following criteria: (1) net turnover under GBP 6.5 million, (2) total balance sheet below GBP 3.2 million, (3) number of employees not exceeding 50. 

Gibraltar Shelf Companies

• Shelf companies are available for Gibraltar non-resident companies. 

Trading Limitations 

A non-resident company is not allowed to trade or conduct any commercial activity, including banking, deposit toking, assurance, insurance, reinsurance, fund management, asset management, other finance-related activities. 

Time Period for Gibraltar Company Formation 

• On average, it takes five to ten days to form a company in Gibraltar. 

Access to Double Tax Treaties

While Gibraltar has not signed any double tax treaties with other countries, it has signed tax information exchange agreements in accordance with the Organization for Economic Cooperation and Development (OECD) model. Among the countries that Gibraltar signed this agreement with are France, Germany, Australia, Ireland, Italy, Poland, Malta, and the United States. 

As a premier business consulting firm, Damalion has the expertise and experience in handling Gibraltar company formation for legal entities and foreign investors looking to do business in Gibraltar. We take great pride in our speed and efficiency in the registration and incorporation process. All the expert work is carried out by our extensive global service network that includes seasoned lawyers, accountants, and other specialists in the financial services and business fields. We can also assist you in other company formation-related activities, including opening a bank account, and many more. Reach out to a Damalion expert today to learn more about the full suite of solutions we offer. 

This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.