Gibraltar is a British Overseas Territory located on the southernmost tip of Europe. Gibraltar is the only British Overseas Territory that is a part of the European Union, by virtue of the UK's accession to the EU in 1973. As a self-governing and self-financing jurisdiction in its own right, Gibraltar enjoys a separate legal and tax system to that of the UK and operates a common law legal system. The Income Tax Act 2010, which came in force in 2011, abolished the 'tax exempt company regime' and officially transformed Gibraltar into an 'onshore' jurisdiction.
Owing to Gibraltar's EU special membership, companies have access through transposed local legislation, to EU direct tax directives such as the Parent & Subsidiary Directive or the Interest & Royalties Directive and as Gibraltar does not typically tax inbound dividends, interest and royalties, there is no withholding tax on passive income. Gibraltar is also not part of the EU VAT or Customs Union and therefore VAT is not taxed in Gibraltar. This makes Gibraltar an unparalleled EU domicile for financial services.
Gibraltar operates a territorial tax system with a low tax regime of 10%, the implied EU minimum. Double tax treaties are not engaged, as double taxation is generally not a concern as taxes are only imposed on income accrued and derived from Gibraltar. Nevertheless, Gibraltar is an OECD 'white list' jurisdiction and is compliant with all OECD international tax standards on the exchange of tax information. To date, Gibraltar has signed a total of 26 Tax Information Exchange Agreements (TIEAs) with jurisdictions such as the US, India, France and Germany.
Additionally Gibraltar's EU membership provides insurance passporting rights, reinsurance and mediation through all 30 EU and EEA countries.
The number of insurance companies writing new business in Gibraltar at present is 56. 13 of these insurance companies write general insurance business and are captives, 3 are Protected Cell Companies (PCCs) that together manage 32 cell companies. Insurers are attracted to Gibraltar because of the ability to process applications within six months, rather than the projected two to three years in London.
Gibraltar was the first EU territory in which the first re-domiciliation of an insurance company from outside the EU into the EU occurred. PCC legislation has existed since 2001. Gibraltar was the first EU territory to introduce PCC legislation and set up PCCs.
In Gibraltar there are over 300 days of sunshine, with very little rain and generally warm temperatures all throughout the year. Gibraltar's airport is a stone throw away from the city centre, with a growing number of UK destinations and Malaga or Jerez airports are nearby for EU and worldwide destinations.
Gibraltar is a leading insurance domicile and the Gibraltar Government, regulator and the industry are committed to facilitate financial services business and have a strong desire to continue to grow the sector. What sets Gibraltar out from the crowd as an EU domicile is its size and how malleable it is as a jurisdiction - the smaller a jurisdiction is the closer the contact with the regulator and the government and thus it is faster and easier to amend aspects that are deemed not favourable to the sector.
Link to the Gibraltar insurance regulator: http://www.fsc.gi/