Gibraltar is tightening its residency system for wealthy individuals, as it wants to ensure they make a 'meaningful' economic contribution.

The British Overseas Territory is increasing the amount of net wealth required to get a new category two visa, which gives residence to high net worth individuals, from £2million to £5million. 

Gibraltar is often considered an attractive location for high net worth people due to its low personal taxation rates. There is also no inheritance tax or capital gains tax. 

Being on a category two visa means someone is only taxed on the first £118,000 of their income, effectively limiting their annual tax bill to £37,000.

'The higher threshold is likely to considerably reduce the size of Gibraltar's potential target market', Paul Correa, managing director of expat specialist Fiduciary Wealth Management told This is Money. 

The cost of applying for the special category two status is also rising from £1,233 to £5,000.

Alongside this, the qualifying residence period for Gibraltarian Status, which gives someone full rights of residence, will also rise from 10 years to 20 years for new residents. 

The changes are expected to come into force on 15 July, alongside the UK-EU treaty on Gibraltar’s economic future. 

Existing category two certificate holders won't be subject to the new threshold. 

The changes being introduced for wealthy individuals relocating to Gibraltar come as the Brexit Treaty officially comes into force. 

This will bring Gibraltar into the Schengen area, removing limits on movement across the border into Spain. 

Previously Gibraltar received an average of around 1,000 residency applications annually, but this increased to more than 3,000 between 2022 and 2024.

When the agreement between the UK and the EU was announced in June 2025, applications almost tripled and the teritorry temporarily suspended all new residency applications from UK and EEA nationals.

Other routes to entry have become more selective or closed. 

In a blow to retirees in the UK, Gibraltar has effectively closed the traditional self-sufficiency residency. Under this scheme, British nationals receiving a UK state pension could establish residence in Gibraltar by transferring their healthcare entitlement from the National Health Service to the Gibraltar Health Authority. 

Amid the new rules, getting residency in Gibraltar is now largely dependent on qualifying employment or genuine business activity. 

Correa told This is Money: 'Gibraltar is a very small territory with a niche international appeal and historically much of the interest has come from UK retirees, entrepreneurs and high-net-worth individuals. Increasing the minimum net worth requirement from £2million to £5million inevitably narrows the pool of eligible applicants.

'That said, Gibraltar remains competitive when compared with alternative jurisdictions such as Greece or Italy, which also offer attractive tax regimes for internationally mobile individuals.'

He added: 'Where the policy is more difficult to justify is the scale of the increase.

'I believe a more measured increase, supported by wider private sector consultation and a comprehensive economic impact assessment, would have provided a stronger evidence base for a policy change of this significance.' 

Stuart Dalmedo, private client partner at Isolas LLP, said: 'The increase is unlikely to diminish Gibraltar's residency appeal proving a very attractive location with the added bonus of enjoying reasonable access and movement into the EU. 

'Looking ahead, the anticipated implementation of the UK–EU agreement relating to Gibraltar, including the removal of the land frontier between Gibraltar and Spain and Gibraltar's practical access to the EU should prove popular. 

'Over time these arrangements are expected to further enhance Gibraltar's attractiveness as a location and not just for residency.'