HEPSS tax residency - (High Executive Possessing Specialist Skills)

The Government introduced from the 1^st July 2007 a new tax residency status known as Hepss (High Executive Possessing Specialist Skills).

This tax residency status is aimed at individuals with specialist skills, who come to work and live in Gibraltar. These individuals must earn more than £100,000 per annum.

The rules for this form of residency can be summarised as follows:

• Applicants must possess skills not already present in Gibraltar, their coming to Gibraltar must also help promote and sustain economic activity in Gibraltar.

• Applicants must earn more than £100,000
  

• Applicants cannot have been resident in Gibraltar for the three years immediately proceeding the application.

• Hepss individuals must live in a Gibraltar qualifying property (similar to those of Category 2 residents).

The advantage of this form of tax residency is that taxation limited to first £100,000 of income.

The tax payable will be under the normal dual choice system (as described in tax rates and allowances). In other words a Gibraltar tax resident, (resident under this scheme) will be able to choose either the allowance or gross tax system based on a fixed salary of £100,000.

This effectively gives you a maximum tax rate of 27.5%. (£100,000 calculated under the gross base system attracts a tax charge of £27,500 and if the allowance based system gives you a better outcome you would choose this instead).