Plan contractor hiring in Gibraltar

A Gibraltar-resident contractor can serve this foreign customer as self-employed when the contractor is genuinely in business on their own account and bears responsibility for the business's success or failure. Gibraltar determines that status from the terms, conditions and facts of this engagement. A chosen label cannot decide it. When the facts support self-employment, the contractor pays their own Gibraltar income tax and social insurance. The foreign customer's lack of a Gibraltar entity or permanent establishment does not remove the local status test for work performed by the resident contractor. The agreement and daily practice should therefore preserve independent delivery, commercial responsibility and a supplier relationship throughout the engagement.

Sources: Gibraltar Income Tax Office, Employment Status Guidance Notes

If the line is crossed

An employment finding makes the foreign customer an employer for Gibraltar PAYE and social-insurance purposes because the rules attach to the person paying remuneration under a contract of service. The payer must deduct tax, account for employer and employee social-insurance shares, notify the authorities and submit the monthly PAYE report and amount by the fifteenth day after the month ends. Unpaid PAYE can become the employer's debt and attract compound interest of 2% for every complete month outstanding, alongside offence provisions. The published employer-registration route asks for Gibraltar incorporation and employment-registration documents that this foreign customer lacks, so employee-like facts should stop onboarding until the Income Tax Office confirms an acceptable offshore-employer process.

Sources: Gibraltar Income Tax (Pay As You Earn) Regulations 1989, Gibraltar Social Security (Insurance) Act, Gibraltar Income Tax Office, Employers

Certificate of Registration

The Certificate of Registration confirms that the contractor's business, trade or profession has been entered in Gibraltar's statutory register. Every person with a place of business in Gibraltar or carrying on business there must submit the prescribed statement within three months of starting, and the Registrar issues the certificate after registration. The contractor needs this document for later administrative steps, including the self-employment application. It identifies a registered business activity; it is separate from Companies House business-name registration and from the Office of Fair Trading licence. The foreign customer should ask for current registration evidence as part of supplier onboarding without treating the certificate as proof of independent status.

Issued by: The Registrar responsible for businesses, trades and professions issues it to the registered person.

Timing: The prescribed registration statement is due within three months after the business begins, and the certificate follows registration.

Sources: Gibraltar Business, Trades and Professions Registration Act, Income Tax Office, SE1 Application for Trade Income

Form SE1

Application for Trade Income

Form SE1 is the Gibraltar contractor's application to register trade income for income tax and social insurance. It records the business name, activity, address, commencement date, expected earnings and relevant employment-status facts. The form asks about control, substitution, equipment, financial risk, fixed pricing, multiple clients and correction of defective work, allowing the Income Tax Office to approve or refuse self-employed status and allocate a social-insurance code. A copy of the Certificate of Registration must accompany it. The customer does not issue this document. It can make completion and approval an onboarding condition before accepting invoices from an individual who says they are self-employed.

Issued by: The individual submits Form SE1 to the Gibraltar Income Tax Office, which records the approval decision and social-insurance code.

Timing: Submit it when the trade starts and before relying operationally on Gibraltar self-employed treatment.

Sources: Income Tax Office, SE1 Application for Trade Income

Sales invoice

The sales invoice is a core Gibraltar income-tax record for the contractor's service revenue. The Income Tax Act requires a person carrying on a trade, business, profession or vocation to keep business records that include contracts and sales invoices. Those records must generally be retained for six years after the end of the accounting period to which they relate. The invoice should therefore identify the parties, service, amount and contractual due date clearly enough to reconcile the contractor's accounts and any later payment dispute. This recordkeeping rule does not create a general turnover tax on the cross-border service, and the customer should retain its matching agreement, acceptance and accounting record.

Issued by: The contractor issues it to the foreign business and retains a copy within the business records.

Timing: Issue it at the contractually agreed billing point and retain it for the statutory six-year record period.

Sources: Gibraltar Income Tax Act 2010

A Gibraltar contractor's ordinary cross-border service invoice should state the agreed service fee without adding Gibraltar transaction tax. The Government's March 2026 clarification says transaction tax is charged on imported goods and excludes services, so it is distinct from VAT and does not apply to the professional service in this scenario. A separate 25% labour deduction exists for subcontractors in the construction industry in Gibraltar. That construction rule does not extend to an ordinary remote professional service. The contract should define the billing milestone, acceptance process, invoice date and due date, while the contractor keeps the invoice and underlying service contract for the statutory income-tax record period.

Sources: Government of Gibraltar, Transaction Tax Clarification, Gibraltar Income Tax Office, Sub-Contractor Guidance, Gibraltar Income Tax Act 2010

What an invoice has to show

• No Gibraltar transaction-tax charge for the ordinary service

  An invoice for the ordinary professional service in this scenario should carry no Gibraltar transaction-tax charge because the Government says the tax applies to imported goods and services are excluded. The description should still identify the service and fee clearly for contract and income-tax records. This conclusion is limited to the current transaction tax and the stated service facts. It does not decide a foreign customer's domestic tax treatment, a specially regulated activity, goods supplied with the service or work within Gibraltar's construction-subcontractor regime. The customer should reject an unexplained Gibraltar transaction-tax line and ask the contractor to identify any different enacted charge before payment becomes due.

  Sources: Government of Gibraltar, Transaction Tax Clarification

• The Gibraltar company's registered name when a company invoices

  A Gibraltar company invoice must state the company's registered name exactly when the company is the supplier. The Companies Act places that name requirement directly on invoices as well as other commercial documents. Additional registered-office and registration-number disclosures in the cited section apply to business letters and order forms, so they should not be extended to an invoice without another applicable rule. This company-specific requirement does not govern an individual who invoices in their own name. The foreign customer should match the displayed company name to the service agreement and Companies House record so that accounting and any debt claim point to the same legal counterparty.

  Sources: Gibraltar Companies Act 2014

If Gibraltar law governs the payment obligation, the parties should set the invoice due date expressly in the service agreement because Gibraltar's commercial-debt statute makes that date the starting point for late-payment consequences. The Act covers payment for services in commercial transactions between undertakings. Where a fixed due date is agreed, statutory interest starts on the following day if the amount remains unpaid. A term longer than 60 calendar days is permitted only when it is expressly agreed and is not grossly unfair to the creditor. The customer should connect each invoice to an accepted milestone, state any review period precisely and raise a genuine dispute before the due date rather than leaving the timing open.

Sources: Gibraltar commercial-debt interest rules, sections 2 to 5 (2003 Act)

When invoices are settled

If Gibraltar law governs the payment obligation and the commercial contract sets no payment date, the statutory fallback is 30 calendar days. Depending on the facts, the period begins after receipt of the invoice or equivalent request, after receipt of the services, or after contractual or statutory acceptance or verification. If a fixed due date exists, interest begins the next day; otherwise it begins when the fallback period expires. The statutory rate is 8 percentage points above the Gibraltar Savings Bank savings-account base rate, and no reminder is required. Recovery compensation is £40 for debt below £1,000, £70 from £1,000 to below £10,000 and £100 at £10,000 or more, plus reasonable excess recovery costs.

Sources: Gibraltar statutory interest and recovery sums, sections 3, 4, and 9 to 11 (2003 Act)

Local currency rules

Gibraltar's former Exchange Control Act creates no current approval, declaration or conversion step because the Exchange Control Repeal Act 2007 repealed it in full from 26 April 2007. That narrow repeal does not choose an invoice currency and does not displace sanctions, customer-country controls, financial-provider checks or contractual conversion terms. The parties should therefore choose the price currency expressly and state who bears any conversion difference, while separately checking restrictions that arise from their own locations and circumstances. The repeal is the relevant Gibraltar currency-control point for this ordinary service payment; it is not a general assurance that every cross-border transaction can proceed without other legal or operational screening.

Sources: Gibraltar Exchange Control Repeal Act 2007

Treating the contract label as the status decision

Calling the individual a contractor does not make the relationship self-employed when the customer controls the person's work as staff. Fixed hours, prescribed location, detailed direction over method, task reassignment and time-based remuneration all point toward employment. The customer should test the planned operating model before signature and then keep actual management aligned with it. Where the service allows, the contractor should retain autonomy, genuine responsibility for results, commercial risk, an ability to correct defects at personal cost and a workable substitution right. The Commissioner considers the whole picture for each engagement, so one carefully drafted clause cannot cure inconsistent day-to-day conduct.

Sources: Gibraltar Income Tax Office, Employment Status Guidance Notes

Stopping after a Companies House step

A contractor can complete a Companies House step and still lack permission to operate the Gibraltar service business. A business-name certificate identifies a trading name, and company incorporation creates a legal person. Department of Business registration, the applicable OFT licence or low-turnover registration, and Income Tax Office self-employment registration remain separate. An individual using only their own name can skip the business-name step while still needing the other activity-based registrations. The customer should request the current documents that match the supplier's structure, activity and turnover, checking annual OFT renewal in either route. Treating one certificate as the entire registration stack can leave the contractor unlicensed, unregistered or absent from the tax and social-insurance process.

Sources: Department of Business, Guide to Business Registration in Gibraltar, Gibraltar Fair Trading Act 2023, Gibraltar Fair Trading (Annual Turnover) Regulations 2023, Income Tax Office, SE1 Application for Trade Income

Applying the construction subcontractor deduction to every service invoice

The published 25% labour deduction applies to subcontractors in Gibraltar's construction industry rather than to every independent service supplier. Extending it to a remote consultant, designer or other ordinary professional would reduce the invoice without a supported basis and would confuse a sector-specific collection rule with the contractor's general income-tax responsibility. The customer should first identify the actual service and where it is performed. If it is construction work in Gibraltar, the specialist subcontractor procedure and section 58 documentation require separate handling. For the ordinary cross-border service in this scenario, the genuinely self-employed contractor remains responsible for their own Gibraltar tax and social insurance.

Sources: Gibraltar Income Tax Office, Sub-Contractor Guidance, Gibraltar Income Tax Act 2010, Gibraltar Income Tax Office, Employment Status Guidance Notes