rocket
Introducing the Orbitax International Tax Platform, a revolutionary suite of integrated tax solutions including research, compliance, calculations, entity management and charting. Find out more.
News Share

The Tax Hub

Daily Tax Newsletter

Spain-United Kingdom-Gibraltar

Responsive image

Spain and the UK Sign Tax Agreement on Gibraltar

Spain's Ministry of Foreign Affairs, the European Union, and Cooperation has announced the signing of a tax agreement with the UK concerning Gibraltar. The agreement is designed to combat tax fraud and money laundering in Gibraltar once the UK leaves the European Union and includes new rules on tax residency for both individuals and companies.

---

Spain Signs Gibraltar Tax Treaty with the United Kingdom

The Minister of Foreign Affairs, the European Union and Cooperation has today signed, ad referendum, an International Agreement between the Kingdom of Spain and the United Kingdom of Great Britain and Northern Ireland with regards to taxation and the protection of financial interests. On behalf of the United Kingdom, the Agreement will be signed today by Minister for the Cabinet Office, David Lidington.

04/03/2019

This Agreement has the status of an International Treaty, and it is the first Treaty that Spain has signed with the United Kingdom regarding Gibraltar since the Treaty of Utrecht in 1713. This Agreement is signed in the framework of the United Kingdom’s withdrawal from the European Union. The signature ad referendum requires approval from the Council of Ministers. Furthermore, due to the subject of the Treaty, it is subject to the corresponding parliamentary approval.

As is known, the European Union has negotiated a Withdrawal Agreement which includes an annexed protocol on Gibraltar as a result of the negotiation between the United Kingdom and Spain. Said protocol mentions the four Gibraltar Memoranda of Understanding signed on 21 November last (on citizens’ rights, tobacco, cooperation on environmental matters and cooperation in police and customs matters) as well as the Tax Agreement signed today by Minister Josep Borrell which has been bilaterally negotiated with the United Kingdom.

This Agreement constitutes an essential element so that Gibraltar’s exit from the European Union pursuant to the Withdrawal Agreement and its Protocol on Gibraltar takes place in an orderly way, in accordance with Spanish interests in matters of taxation and in the fight against fraud and tax evasion.

Should the United Kingdom not sign the Withdrawal Agreement and leave the European Union without an agreement, the tax treaty will still be equally useful as it ensures Spain that there will be a high degree of cooperation from the relevant tax authorities when European Union law stops being applicable in Gibraltar.

The objectives that have been reached in this treaty are:

  • The reduction and elimination of tax fraud and the adverse effects for the Spanish Treasury derived from the characteristics of Gibraltar’s tax regime.
  • The establishing of clear rules in order to more easily resolve conflicts regarding the tax residency of natural persons.
  • The prevention of tax residents of Spain using businesses subject to Gibraltar's tax regime or for said businesses to undertake economic activities in Spain.

For this, the Agreement establishes a reinforced administrative cooperation regime between the relevant authorities of the respective tax offices. This regime includes the exchange of information on certain categories of income and assets of particular importance in the fight against fraud in the area. Likewise, the dynamic adaptation is expected of this special cooperation regime to the new standards of the European Union and the OECD with regard to transparency, administrative cooperation, harmful tax practices and the fight against money laundering.

The agreement also establishes a series of rules in order to resolve the conflicts regarding the tax residency of natural persons, with the aim of solving the problems of the false residencies in Gibraltar of natural persons who actually reside in Spain.

With regard to legal persons and other Gibraltarian entities, their tax residency is established in Spain when they have a significant relation with Spain, either due to the location of the majority of their assets or the obtaining of the majority of most of their income in our country, or when the majority of their owners or directors are tax residents of Spain.

Powerful Tax Tools

NEW

FX Rates

Global FX Rates including Tax Year Average FX Rates and Spot Rates for all Reporting Currencies.

NEW

Corporate Tax Rates

Corporate tax rates, surtaxes, and effective tax rates for the current year, as well as historical rates and approved future rates.

NEW

Country Analysis

Detailed tax guidance for companies doing business in over 100 countries, including summaries and snapshots of key tax facts and issues.

NEW

Cross Border Tax Calculator

Calculate total tax costs and benefits of a cross border transaction including withholding tax, participation exemption and foreign tax credit rules.

NEW

Cross Border Tax Rates

Provides Domestic, treaty and EU cross border tax rates for over 5,000 country combinations for 9 different payment streams.

NEW

OECD BEPS Project

Complete overview of the OECD BEPS Project, including daily BEPS news, country adoption of BEPS measures, and an overview of the 15 BEPS Actions.

NEW

Tax Calendar

Customizable calendar tool that tracks corporate income tax, value added tax and transfer pricing obligations by country or entity.

NEW

Tax Forms

English translations of key tax forms for over 80 countries, including tax return forms, treaty benefit forms, withholding tax forms, and more.

NEW

Worldwide Tax Treaties

Repository including thousands of tax treaties (in English), OECD, UN and US Models, relevant EU Directives, Technical Explanations, and more.

NEW

Worldwide Tax Planner

Calculates the worldwide tax cost of what-if scenarios based on legal entity structure, taxable income, and cross border transactions.

NEW

Certified Rates Report

Customizable Certified Rates Report providing updated corporate and withholding tax rates at the end of each month for over 100 countries.

NEW

Withholding Tax Minimizer

Enables quick calculation of tax costs and benefits of cross border transactions considering all possible transaction combinations and optimal routes.

NEW

VAT Rates

Provides value added tax (VAT) rates, goods and services tax (GST) rates and other indirect tax rates for over 100 countries.

NEW

NOL Calculator

Country specific calculator to determine how net operating losses can be utilized in carryback and carryforward years.

NEW

Transfer Pricing Calculator

Calculates TP ratios under various TP methods and calculates the difference between target ratios and actual ratios.

NEW

Individual Income Tax Rates

Individual tax rates for over 100 countries.

Play of the Day

FX Rates

Global FX Rates including Tax year Average FX Rates and Spot Rates for all Reporting Currencies.

We’re here to help

We’re here to answer any questions you have about the Orbitax products and services.

Send us a message

Who’s behind Orbitax?

We’re committed to providing high value, low cost tax research and management solutions.

Learn More