The Bahamas is a gorgeous archipelago of hundreds of islands. Its tax regime is very investor-friendly, and the country offers world-class shopping, dining, and spas. There are also some of the most luxurious homes in the Caribbean, making it a great choice for investment property. However, there are some important factors to consider before purchasing property in the Bahamas.
First, you must understand how much tax you’ll have to pay to purchase property in The Bahamas. There are several tax breaks available for non-owner occupied property, but they usually apply only to residential properties with up to four units. They also don’t apply to outbuildings and properties used for commercial purposes.
Property in the Bahamas is one of the most popular investments among US investors. This country is considered a safe haven for property investment because of its tropical climate, low crime rate, and flexible immigration policy. The country also has a very stable economy. Its government policy is designed to promote consistent growth in the real estate sector. The government has also recently established a ministry of financial services, which is aimed at simplifying the property purchase process.
Another benefit of buying property in The Bahamas is the low tax rate. The Bahamas has no income tax, capital gains tax, or inheritance tax. This makes it attractive for wealthy real estate investors who are looking for a tax-efficient real estate investment. In addition, the transaction costs are also low, making it an appealing choice for people who want to be location-independent.
Taxes on property in The Bahamas are paid to the Department of Inland Revenue. These tax payments are due on the last day of December each year. In case of default, the Department of Inland Revenue has the right to re-assess the property. The maximum property tax assessed in a year is $50,000. As such, it’s imperative to pay these taxes on time. lyford cay bahamas rentals You can pay in Bahamian currency, or in the currency of your home country. If you fail to pay the taxes on time, you can expect to face a fine of 5%.
If you are not a resident of The Bahamas, you must obtain a permit to purchase real estate in The Bahamas. This is necessary if you are buying property for development or rental. You must also register your investment with the Foreign Investment Board and the Central Bank of The Bahamas. The vendor and purchaser of the property will pay stamp duty, which is split 50-50. Attorneys charge a fee of around one percent of the sale price.
The Bahamas Real Property Tax Act lists the types of real property that are subject to taxation. This tax is applicable to individuals, corporations, and partnerships. However, there are some types of property that are exempted from taxation.