Gibraltar corporate tax explained

Gibraltar corporate tax is charged at 15% on profits accrued in and derived from Gibraltar. That rate has applied since 1 July 2024 and was left unchanged in the July 2026 Budget. Utilities, fuel suppliers and companies abusing a dominant position pay 20%. Dividends received and capital gains are not taxed. Companies make two 50% payments on account each year and file their return within nine months.

At a glance

What is the corporation tax rate in Gibraltar?

The standard rate is 15%. It rose from 12.5% with effect from 1 July 2024; for an accounting period that straddles that date, taxable profit is split on a daily basis between the two rates. The rate had been 10% from 2011 until 2021.

A 20% rate applies to companies supplying utilities or fuel and to companies that abuse a dominant market position. Telecommunications companies pay 20% on their telephony business, which the Income Tax Office groups with utilities, and the standard rate on their non-telecoms activities.

The 2026 Budget, delivered on 7 July 2026, made no change to the rate. Some older or archived pages still quote 12.5%; those figures are out of date.

What does “accrued in and derived from Gibraltar” mean?

Gibraltar taxes companies on a territorial basis. The test is where the activities that generate the profit actually take place, not where the company is registered or where the money is banked.

In practice:

• Profits from activities carried out in Gibraltar are taxable here.
• Profits from an activity that needs a licence and regulation under Gibraltar law are treated as arising in Gibraltar.
• The same applies to business done through a branch under a foreign licence using passporting rights, where a Gibraltar licence would otherwise have been needed.
• Profits genuinely earned from activities carried out outside Gibraltar are generally not taxable, even if the company is incorporated here.

Applying the test is fact-sensitive. Where the directors sit, where contracts are negotiated and where staff do the work all matter. If you need certainty, the Income Tax (Tax Rulings) Rules 2018 let you apply to the Commissioner of Income Tax for an advance ruling on a specific transaction, on a standard form with a full account of the facts. The Commissioner should normally decide within 21 days, and a ruling can be relied on for up to three years.

How is passive income taxed?

Passive income has its own rules, and two types are taxed regardless of where they come from.

Inter-company interest and royalties received by a Gibraltar-registered company are treated as arising in Gibraltar. This closes the obvious route of booking intra-group income in a Gibraltar company and claiming it is foreign-source.

Since 1 January 2025, profits from selling residential property can be taxed where a person holds, directly or indirectly, five or more taxable properties, including disposals over five consecutive periods. A main residence and some forced sales are excluded. For holding structures, see investment holding companies in Gibraltar.

When are payments on account due?

Companies pay corporation tax in advance through two payments on account:

1. 28 February: 50% of the tax for the relevant earlier accounting period.
2. 30 September: the other 50%.

The relevant earlier period for each payment is set by Schedule 10 of the Income Tax Act 2010, and the Income Tax Office publishes a table mapping year ends to payment dates. Any balance is paid when the return is filed.

If profits are falling, you can apply to reduce the payments using Form CT4. If the final liability turns out higher than the reduced amounts, surcharges apply to the shortfall, so reduce only on a sound forecast. Because each payment is based on the tax for an earlier accounting period, a new company generally has nothing to pay on account in its first period: the first year’s tax is paid with the first return, and payments on account follow. Check the timing for your year end against the Income Tax Office’s Schedule 10 table.

When is the corporate tax return due?

The return (Form CT1), together with signed accounts, is due nine months after the end of the month in which the accounting period ends. For a 30 June year end, the deadline is 31 March. You must file even if the Income Tax Office has not sent you a return.

Accounts sent with the return must be audited where assessable income is £1,750,000 or more, for periods ending on or after 1 July 2024. Below that threshold, an independent accountant’s report is required. A company that declares a dividend also files Form CT2 within nine months of the end of the period in which it was declared; how those dividends are taxed in shareholders’ hands is covered in paying yourself from a Gibraltar company. The full compliance calendar is in accounting, audit and annual filings.

What are the penalties for late filing or payment?

Late payment triggers a 10% surcharge the day after the due date, and a further 20% if the tax (including the first surcharge) is still unpaid 90 days later.

Late or incomplete returns for periods ending on or after 31 March 2024 attract fixed penalties by company size, charged from 1 January 2025:

A fraudulent, reckless or negligent return can lead to a penalty of up to 150% of the tax understated.

Does Pillar Two or a minimum tax apply?

Only to large groups. Gibraltar enacted the Global Minimum Tax Act 2024 in December 2024. It introduced a 15% domestic minimum top-up tax for fiscal years beginning on or after 31 December 2023, and an income inclusion rule for fiscal years beginning on or after 31 December 2024. There is no undertaxed profits rule.

The rules apply to multinational and domestic groups with consolidated revenue of at least €750 million. In-scope groups had to register with the Income Tax Office (by 28 February 2026 for fiscal years ending between 31 December 2024 and 31 August 2025), and may need to file a GloBE information return or the Gibraltar top-up tax return, Form GMTA1, 15 months after the year end (18 months in the first year).

If your company is a stand-alone business or part of a small group, the global minimum tax does not affect you.

What changed with the 2026 UK–EU treaty

The UK–EU treaty, signed on 14 July 2026 and applied provisionally since 15 July 2026, does not change Gibraltar’s corporation tax rate or territorial basis. Its tax effects for companies are indirect:

• Harmful tax regimes. The UK, for Gibraltar, and the EU endorsed a joint political declaration on countering harmful tax regimes, based on OECD BEPS Action 5 principles such as substance and transparency. It is a political commitment, with an optional annual dialogue, and sets no tax rate.
• State aid. A UK declaration states that, when testing whether a tax measure is selective, the reference framework is the territory of Gibraltar itself.
• Spain. Spain removed Gibraltar from its list of non-cooperative jurisdictions with effect from 28 June 2026. Spanish groups with Gibraltar subsidiaries should see fewer anti-avoidance frictions on future transactions, though earlier years remain open to review.
• Goods. Import duty has been replaced by a transaction tax on goods. This is an indirect tax and does not change corporation tax.

For the wider picture, see the UK–EU treaty explained for business.

How can you manage your Gibraltar tax position?

• Document where profit-making activities happen, especially if directors or staff are outside Gibraltar.
• Keep inter-company loans and royalty arrangements on arm’s-length terms and watch the £100,000 interest threshold.
• Diarise payment on account dates and the nine-month filing deadline from your first year end.
• Check whether a business licence is needed, since licensable activities are deemed to arise in Gibraltar.

For the rest of the set-up journey, go back to the Gibraltar business hub.