Self-employment in Gibraltar

An overview of the process to be followed by foreigners setting up as self-employed workers, contractors, sole traders or freelancers in Gibraltar. Find out how and where to register and the paperwork required...

Anyone legally resident in Gibraltar and wanting to becoming self-employed can set up as a sole trader, which is the most simple type of business structure to set up. In order to being working as a sole trader, the individual just has to register with the Employment Office and the Income Tax office.

An application form (S1) for registration as a self-employed person must be filled in and sent to the Gibraltar Tax office. The application takes approximately five working days to be considered. Following this period, the individual can register with the Employment Service. Once this has been done, the Income Tax office sends the applicant an information pack with all the necessary documents.

For taxi drivers, a separate form is required for registration (S3).

If the sole trader wishes to trade with a name other than their own name, they need to register the business name with Companies House. This name must be approved before registration. The name has to be unique and cannot be used by anyone else. Once the name is registered and a fee paid, a Certificate of Registration of a Business Name is issued.

Some sole traders may require a license to begin trading in Gibraltar depending on the kind of business they are operating. For example a trade licence may be required for retailers.

There are very few costs involved when setting up as a sole trader and it is not expensive to run. One of the disadvantages of setting up as a sole trader in Gibraltar is that the individual is responsible for any losses that the business may incur.

Tax returns for sole traders

A sole trader is taxed as an individual and pays personal income tax rates. Business income and any losses are declared on the personal tax return form. Tax returns for sole traders (IT1P) must be submitted by 30 November following the tax year for which tax is assessed; tax payments are due on 31 January and 30 June each year of assessment. The amount paid is based upon the tax liability for the previous year of assessement.