Advanced Search

Home Purchase (Deductions) Rules, 1989


Published: 1989-11-23

Subscribe to a Global-Regulation Premium Membership Today!

Key Benefits:

Subscribe Now for only USD$40 per month.
I ASSENT Income Tax HOME PURCHASE (DEDUCTIONS) RULES, 1989
© Government of Gibraltar (www.gibraltarlaws.gov.gi)
2010-21
Subsidiary
1989/099
Rules made under s.37A.


HOME PURCHASE (DEDUCTIONS) RULES, 1989

(LN.1989/099)
23.11.1989


Amending
enactments
Relevant current
provisions
Commencement
date

LNs. 1990/078 r.2(2)(c) and (4) 28.6.1990
1992/021 rr. 2, 2A, 3, 6(1), (3) and (4) 1.7.1991
1992/022 r.2(1) 1.7.1993
1993/090 rr.2(2)(d) and 2A(d) 1.5.1993
2002/039 rr. 2(1)(i), (ii), (2)(e) and (2A),
2A(1)(i) and (ii)

1.7.2002
2008/067 r. 8 1.7.2007
Act. 2014-10 rr. 2(3), 2A, 6 & 8 28.3.2014
LN. 2015/034 rr. 8(1), (4) 1.7.2013
“ rr. 8(4) 1.7.2014

_____________________

ARRANGEMENT OF RULES.

Rule
1. Title.
2. Deduction for payments towards house purchase for own residential
occupation.
2A. Deductions for payments towards house purchase for child’s
residential occupation.
3. Carry over of relief.
4. Joint ownership.
5. Provisional refund.
6. Forfeiture of deduction.
7. Repeal of section 26A of the Act.
8. Restrictions on entitlement to deduction specified in rule 2 and rule 2A
in relation to elections made for Gross Income Based System.

Income Tax HOME PURCHASE (DEDUCTIONS) RULES, 1989
© Government of Gibraltar (www.gibraltarlaws.gov.gi)
2010-21
Subsidiary
1989/099
Income Tax HOME PURCHASE (DEDUCTIONS) RULES, 1989
© Government of Gibraltar (www.gibraltarlaws.gov.gi)
2010-21
Subsidiary
1989/099 Title.

1. These Rules may be cited as the Home Purchase (Deductions) Rules,
1989.

Deduction for payments towards house purchase for own residential
occupation.

2. (1) Subject to subrules (2) and (3), an individual who is ordinarily
resident in Gibraltar, other than an individual in respect of whom a certificate
issued under rule 2 of the Rates of Tax (Relocated Executive Possessing
Specialist Skills) Rules, 1992 is in effect, and proves to the satisfaction of
the Commissioner that he or his spouse living with him–

(a) has purchased, or entered into an agreement to purchase, a
dwelling situate in Gibraltar for his or their own residential
occupation; or

(b) has constructed, or is in the process of constructing, a dwelling
in Gibraltar for such a purpose,

(i) prior to 1 July 2001, shall be entitled in any one or more
years of assessment to claim a deduction or deductions
amounting in aggregate to not more than £10,000 from
his or her assessable income;

(ii) on or after 1 July 2001, shall be entitled in any one or
more years of assessment to claim a deduction or
deductions amounting in aggregate to not more than
£11,500 from his or her assessable income.

(2) Subject to rule 3, a deduction under this rule:

(a) shall not be allowed more than once nor be granted in respect of
more than one dwelling at any one time;

(b) shall only be allowed in respect of any payment or payments
made on or after 1 July 1988 towards the purchase or
construction of the dwelling;

(c) shall not in any year of assessment exceed the aggregate amount
paid by the individual in that year towards the purchase or
construction of the dwelling, including the repayment of any
loan, any part of a loan, or any interest on any loan obtained by
him or his spouse for that purpose and shall not in total exceed
the purchase price or the cost of construction of the dwelling;
and
Income Tax HOME PURCHASE (DEDUCTIONS) RULES, 1989
© Government of Gibraltar (www.gibraltarlaws.gov.gi)
2010-21
Subsidiary
1989/099
(d) shall not be allowed to an individual who–

(i) is a resident tenant of a dwelling belonging to the Crown
in right of its Government of Gibraltar in respect of the
purchase of such dwelling; or

(ii) has acquired from the Crown in right of its Government
of Gibraltar a property for redevelopment for his own
residential occupation in respect of the acquisition of that
property,

where that purchase or acquisition has taken place prior to the
1st day of May 1993, or

(iii) has purchased property from the Crown in right of its
Government of Gibraltar on terms that he shall not, in
respect of that purchase, be eligible for a reduction or
relief under these Rules or any replacement thereof.

(2A) Notwithstanding paragraph (2)(a), where an allowance under this
rule or rule 2A has been allowed in respect of a dwelling prior to 1 July 2001
a further deduction may be allowed after 1 July 2001 in respect of a separate
dwelling subject to the deduction being reduced by the amount of the
deduction allowed under these rules or the principal Act prior to 1 July 2001.

(3) An individual claiming a deduction under this rule may elect that the
deduction be made from the assessable income of his own, or of his spouse
or civil partner, or of both in the proportion of 50% each.

(4) For the purpose of ascertaining entitlement to a deduction under
these Rules, “amount” shall not include any proceeds received by an
individual on maturity or earlier realisation of a policy of life assurance
entered into for the purpose of securing a loan to assist in the purchase of the
dwelling.

Deductions for payments towards house purchase for child’s residential
occupation.

2A.(1) Subject to subrules (2) and (3), an individual who is ordinarily
resident in Gibraltar and proves to the satisfaction of the Commissioner that
he or his spouse or civil partner with him–

(a) has purchased, or entered into an agreement to purchase, a
dwelling situate in Gibraltar for residential occupation by a child
of theirs or his or hers; or

Income Tax HOME PURCHASE (DEDUCTIONS) RULES, 1989
© Government of Gibraltar (www.gibraltarlaws.gov.gi)
2010-21
Subsidiary
1989/099 (b) has constructed or is in the process of constructing, a dwelling
in Gibraltar for such a purpose,

(i) prior to 1 July 2001, shall be entitled in any one or more
years of assessment to claim a deduction or deductions
amounting in aggregate to not more than £10,000 from
his or her assessable income;

(ii) on or after 1 July 2001, shall be entitled in any one or
more years of assessment to claim a deduction or
deductions amounting in aggregate to not more than
£11,500 from his or her assessable income.

(2) Subject to rule 3, a deduction under this rule–

(a) shall not be allowed more than once in respect of a particular
child of theirs or his or hers nor be granted in respect of more
than one dwelling for such child at any one time;

(b) shall only be allowed in respect of any payment or payments
made on or after 1st July 1988 towards the purchase or
construction of the dwelling;

(c) shall not in any year of assessment exceed the aggregate amount
paid by the individual in that year towards the purchase or
construction of the dwelling, including the repayment of any
loan, any part of any loan, or any interest on any loan obtained
by him or his spouse or civil partner for that purpose and shall
not in total exceed the purchase price or the cost of
construction of the dwelling; and

(d) shall not be allowed to an individual who–

(i) is a resident of a dwelling belonging to the Crown in right
of its Government of Gibraltar in respect of the purchase
of such dwelling; or

(ii) has acquired from the Crown in right of its Government
of Gibraltar a property for redevelopment for residential
occupation for such a child in respect of the purchase of
such property,

where that purchase or acquisition has taken place prior to the 1st of May
1993, or

(iii) has purchased property from the Crown in right of its
Government of Gibraltar on terms that he shall not, in
Income Tax HOME PURCHASE (DEDUCTIONS) RULES, 1989
© Government of Gibraltar (www.gibraltarlaws.gov.gi)
2010-21
Subsidiary
1989/099 respect of that purchase, be eligible for a deduction or
relief under these Rules or any replacement thereof.

(3) An individual claiming a deduction under this rule, may elect that the
deduction be made from the assessable income of his own, or of his spouse
or civil partner, or of both in the proportion of 50% each.

(4) For the purpose of ascertaining entitlement to a deduction under this
rule “amount” shall not include any proceeds received by an individual on
maturity or earlier realisation of a policy of life assurance entered into for the
purpose of securing a loan to assist in the purchase of the dwelling.

Carry over of relief.

3. Where the amount claimed in respect of the dwelling in any year of
assessment is less than the amount to which the individual is entitled under
these Rules, then notwithstanding rule 2(2)(c) and/or rule 2A(2)(c) a
deduction shall be granted in respect of the balance of the entitlement in any
subsequent year of assessment.

Joint ownership.

4. Where it is shown to the satisfaction of the Commissioner that two or
more individuals are entitled to a deduction under these Rules separately in
respect of the same dwelling, the Commissioner shall only allow each such
individual a reduced deduction, the amount of which shall be reckoned by
reference to the individual’s interest in the dwelling.

Provisional refund.

5. If the Commissioner is satisfied that an individual has not obtained the full
tax relief that he is entitled to under these Rules in any year of assessment the
Commissioner may, at his discretion, refund to that individual an amount of
tax equivalent to tax at the standard rate on the unutilised balance of the
relief to which the individual was entitled in that year of assessment subject
to any adjustment that may be made in the individual’s assessment for that
year.

Forfeiture of deduction.

6. (1) Subject to subrule (2), an individual who, within twelve months of
obtaining the legal estate of the dwelling in respect of which a deduction is
allowable under rule 2,–

(a) sells or disposes (otherwise than by way of mortgage) of his
interest therein; or

Income Tax HOME PURCHASE (DEDUCTIONS) RULES, 1989
© Government of Gibraltar (www.gibraltarlaws.gov.gi)
2010-21
Subsidiary
1989/099 (b) fails or ceases to use such dwelling for his own residential
accommodation,

shall not be entitled to claim deduction under these Rules and where such a
deduction has been made in respect of a past year of assessment, the
Commissioner may make an amended or additional assessment to bring the
amount of that deduction to charge, in accordance with section 74 of the
Act.

(2) Subrule (1) shall not apply where the individual ceases by reason of
his death to use such dwelling for his residence and the dwelling continues to
be occupied by his spouse or civil partner.

(3) Subject to subrule (4), an individual who or whose child or the child
of whose spouse or civil partner, within twelve months of obtaining the legal
estate of the dwelling in respect of which a deduction is allowable under rule
2A–

(a) sells or disposes (other than by way of mortgage) of his interest
therein; or

(b) fails or ceases to use such dwelling for residential occupation by
that child,

shall not be entitled to claim deduction under these Rules and where such
deduction has been made in respect of a past year of assessment, the
Commissioner may make an amended or additional assessment to bring the
amount of that deduction to charge, in accordance with section 74 of the
Act.

(4) Subrule (3) shall not apply where such child ceases by reason of his
death to use such dwelling for his residence and the dwelling continues to be
occupied by his spouse or civil partner, or by another child of the individual
to whom a deduction in respect of that dwelling has been allowed under rule
2A and in respect of which child the individual would have been entitled to
claim a deduction under rule 2A but has not done so.

Repeal of section 26A of the Act.

7. Section 26A of the Act is repealed, provided that an individual who, prior
to the coming into operation of these Rules–

(a) was a resident tenant of a dwelling belonging to the Crown in
right of its Government of Gibraltar;

(b) has acquired from the Crown a property for redevelopment for
his own residential occupation,
Income Tax HOME PURCHASE (DEDUCTIONS) RULES, 1989
© Government of Gibraltar (www.gibraltarlaws.gov.gi)
2010-21
Subsidiary
1989/099
shall continue to be entitled to claim the deduction, in respect of the purchase
by him or his spouse of that dwelling, specified in section 26A of the Act
prior to its repeal by these Rules.

Restrictions on entitlement to deduction specified in rule 2 and rule 2A
in relation to elections made for Gross Income Based System.

8.(1) Subject to subrule (4), an individual who elects to be chargeable
under the Gross Income Based System for the purposes of rule 3A of the
Rates of Tax Rules, shall not be entitled to any deduction under these Rules.

(2) An individual who has a spouse or civil partner that has elected to be
chargeable under the Gross Income Based System for the purposes of rule
3A of the Rates of Tax Rules, shall not be entitled to any deduction under
these Rules, unless–

(a) the individual would (but for this subrule) be entitled for the
year of assessment commencing 1 July 2007 and for any
subsequent year of assessment to a deduction under these
Rules; and

(b) either–

(i) the individual had claimed on the appropriate form
prescribed by the Commissioner for a deduction under
these Rules and such claim had been made and submitted
to the Commissioner on or before 30 June 2007 in
respect of the year of assessment commencing 1 July
2006; or

(ii) the spouse or civil partner had claimed on behalf of the
individual on the appropriate form prescribed by the
Commissioner for a deduction under these Rules and
such claim had been made and submitted to the
Commissioner on or before 30 June 2007 in respect of
the year of assessment commencing 1 July 2006,

in which case, the individual in relation to the year of assessment
commencing 1 July 2007 and for any subsequent year of assessment shall be
entitled to the deduction.

(3) Where the individual would (but for subrule (1)) be entitled for the
year of assessment commencing 1 July 2007 and for any subsequent year of
assessment–

(a) to a deduction under these Rules; and
Income Tax HOME PURCHASE (DEDUCTIONS) RULES, 1989
© Government of Gibraltar (www.gibraltarlaws.gov.gi)
2010-21
Subsidiary
1989/099
(b) the individual and his spouse or civil partner have not claimed
the deduction referred to in paragraph (a), in the manner
described in paragraphs (b)(i) and (b)(ii) of subrule (2),

the individual in relation to the year of assessment commencing 1 July 2007
and any subsequent year of assessment shall be entitled to claim from his
assessable income a deduction not exceeding one half of the deduction that
would be allowable under these Rules (but for subrule (2)) on his assessable
income.

(4) Notwithstanding subrule (1), an individual who elects to be
chargeable under the Gross Income Based System shall, subject to any
restrictions or conditions provided for in these Rules, be entitled to claim an
allowance of up to £6,000.