What is the Category 2 (Cat 2) Residency program, and how is the tax capped?
Short answer
Category 2 is Gibraltar's high net worth individual status, under which only the first £118,000 of assessable income is taxed, so annual tax is between £37,000 and £42,380 whatever your worldwide income. New applicants need net assets of at least £5 million following changes announced on 18 June 2026.
Detailed answer
How the cap works A Category 2 individual is liable to Gibraltar income tax only on the first £118,000 of assessable income each year, under the Allowances Based System. The maximum annual tax is £42,380 and the minimum is £37,000. Income above the cap is not taxed in Gibraltar. Eligibility Applicants must not have been resident in Gibraltar in the previous five years, must have approved residential accommodation available for their exclusive use, and must meet the net wealth requirement. On 18 June 2026 the Government announced that the requirement for new applicants would rise from £2 million to £5 million, with the application fee rising from £1,233 to £5,000. Existing holders are grandfathered. Limits Category 2 status carries no entitlement to publicly funded schooling or healthcare. A person who ceases to hold the status loses that basis for living in Gibraltar. If you need a Gibraltar tax residence certificate, the Income Tax Office may also expect evidence of physical presence and ties under its residence guidance.