Individual - Significant developments

Last reviewed - 22 December 2020

Budget summary

Below is a summary of the key taxation changes to existing legislation as a result of the Chief Minister’s budget speech on 10 June 2019. The 2020 budget has been postponed as a result of the impact of COVID-19 and is expected to take place in March 2021. 

Personal tax

There is an increase in the low income earners allowance so that any taxpayer with income of 11,450 British pounds (GBP) or less with effect from 1 July 2019 does not pay any income tax. This change applies to both the Allowances Based system and the Gross Income Based system.

In respect of the Allowances Based system, the following changes were announced with effect from 1 July 2019:

  • Personal allowance and spouse/civil partner’s allowance increased from GBP 3,385 to GBP 3,455.
  • One parent family allowance increased from GBP 5,575 to GBP 5,690.
  • Nursery allowance increased from GBP 5,290 to GBP 5,400.
  • Child allowance increased from GBP 1,165 to GBP 1,190.
  • Child study abroad allowance increased from GBP 1,325 to GBP 1,355.
  • Dependent relative allowance increased from GBP 305 to GBP 315 where the relative is resident in Gibraltar, and from GBP 215 to GBP 220 where the relative is resident outside of Gibraltar.
  • Disabled individual allowance increased from GBP 9,285 to GBP 9,475
  • Blind allowance increased from GBP 5,285 to GBP 5,395.
  • Medical insurance allowance increased from GBP 5,285 to GBP 5,395.

With respect to the Gross Income Based system, the home purchase allowance in respect of approved expenditure incurred during the purchase of a residential property for a taxpayer's own occupation has increased from GBP 6,500 to GBP 7,500.

Statutory minimum wage

The statutory minimum wage increased to GBP 7.25 per hour with effect from 1 August 2020.