Tax Updates in Gibraltar: Key Changes for 2025

With the arrival of 2025, Gibraltar introduces a series of significant tax measures impacting businesses and individuals alike. These reforms, enacted on December 23, 2024, address key areas such as profits from the sale of residential properties, penalties for late filings, marketing and promotion deductions, and the global BEPS Pillar Two framework.

In this article, we delve into the main changes and how they might affect your business in Gibraltar.

Profits from the Sale of Residential Properties

As of January 1, 2025, new rules apply to profits derived from the sale of residential properties. These measures target individuals owning, directly or indirectly, five or more residential properties in Gibraltar. Exemptions include properties used as the taxpayer’s primary residence, properties deemed uninhabitable or under substantial repair, and those constructed before January 1, 1988, and continuously held by the same owner since then.

Increase in Late Filing Penalties

Penalties for late filing of tax documentation for companies have increased significantly in 2025, with fines varying based on company size. For instance, a large company may face penalties of up to £5,000 for filings delayed by more than six months.

Restrictions on the Use of Tax Losses

From July 31, 2024, regulated entities and those conducting licensable activities will face restrictions on the amount of tax losses they can offset against profits. Only up to 50% of taxable profits for a given accounting period can be offset.

Increases in Audit Threshold

The income threshold for requiring an audit for small companies has been raised to £1.75 million for accounting periods ending on or after July 1, 2024.

Super-Deduction for Marketing and Promotion

The definition of costs eligible for the 50% super-deduction in marketing and promotion has been narrowed. It now applies exclusively to activities promoting Gibraltar as a tourism destination or as an attractive jurisdiction for new business ventures.

BEPS Pillar Two Top-Up Tax

In alignment with the OECD initiative, Gibraltar has introduced a top-up tax for multinational groups with consolidated revenues of €750 million or more, ensuring a minimum effective tax rate of 15%. This includes a domestic top-up tax to retain tax revenue within Gibraltar rather than allowing it to be collected by other jurisdictions.

How Do These Changes Affect You?
TAG is here to help you navigate this new fiscal landscape. From strategic planning to regulatory compliance, our team of experts is ready to provide tailored solutions that optimize your operations and ensure adherence to the new regulations.

Contact us today for personalized advice to meet your needs!

📧 info@tag.gi
📞 +350 225 01252

- Regulated by the Gibraltar Financial Services Commission