Anti-avoidance measures prescribed by Gibraltar now enacted
In a significant move to combat tax avoidance, Gibraltar has introduced new anti-tax avoidance legislation, effective from July 11, 2025. The changes are contained in the Income Tax (Amendment) Act 2025, based on a bill published by the Gibraltar Government on April 10, 2025.
The Commissioner of Income Tax now has the authority to counteract or disregard any tax advantage obtained from a tax-avoidance arrangement. A tax-avoidance arrangement is defined as one that primarily aims or one of its main purposes is to secure a tax advantage inconsistent with legislative intent.
The new legislation extends the Commissioner's authority to counteract or disregard the "income from occasional presence" exemption for directors' fees and certain other employment income of nonresidents who are present in Gibraltar for less than 30 days in the tax year, if the Commissioner believes the amount lacks economic reality.
The Commissioner may also refer any person to their professional or regulatory body if they are believed to have submitted an inaccurate tax return deliberately or are promoting tax-avoidance arrangements that contravene the spirit and purpose of the Act.
The Alert, informing taxpayers about these new measures and their implications for their tax arrangements, was published by NTD, a tax advisory firm that offers various tax services. The Tax Technical Knowledge Services group of NTD served as the publisher, with Carolyn Wright serving as the legal editor.
The Alert provides additional information and can be found in the Tax News Update: Global Edition (GTNU). It highlights the increased focus on ensuring compliance by multinationals and other taxpayers in Gibraltar.
The specific person or organization behind "notre nom de marque Limited," a Gibraltar-based private limited company, is not publicly disclosed in available sources. Contact information for the company, including Neil Rumford and Stephen Carreras, is available in the Alert.
The amendment also allows the Commissioner to counteract or disregard a tax-avoidance arrangement or deferral of tax if profits are accumulated in a company and the company voluntarily liquidates. In such cases, the proceeds of the liquidation shall be deemed to be dividends that the company paid to the shareholder.
This new legislation does not represent a fundamental change in Gibraltar's approach to anti-avoidance, but it signals an increased focus on tax avoidance and ensuring compliance by multinationals and other taxpayers.
