Persons authorized under the Act may elect to begin their fiscal year on April 1, July 1 or October 1 and must notify the Secretary in writing of their election no later than December 1, 2019. Otherwise, they are deemed to have selected the fiscal year beginning on January 1. The following changes have been made to the applicable stamp duty rates: stamp duty (stamp duty), business registration tax and property tax. Prior to the entry into force of the Stamps (Amendment) Act 2019 and the Value Added Tax (VAT) Amendment Act 2019, which came into force on 1 July 2019, the sale or transfer of Bahamian real estate was subject to payment of stamp duty and VAT. As a result of these legislative changes, stamp duty has been completely replaced by VAT (for more details, see “New tax reforms in force”). The Stamp Act has been amended to reflect the fact that a “mortgage transfer” in respect of a residential immovable involves a transaction in which a mortgage is completed by a licensed credit institution and a new mortgage is created with a new licensed credit institution in respect of the same property. No stamp duty is levied on the satisfaction of the existing mortgage or the new mortgage, unless the new lending institution makes other contributions; in this case, stamp duty shall be payable only on the other amounts advanced by the new lending institution. Applications for exemption from stamp duty for new owners of transport carried out on or after 1 January 2003 must be submitted by 31 December 2018 at the latest. When the Deputy Prime Minister and Minister of Finance was appointed on 30 September. In May 2018, he presented the communication on the 2018-2019 budget to the House of Assembly, stressing that the government intends to develop a modern and fair property tax system.

A stamp duty of 1.5% is payable when converting Bahamian currency into foreign currency, regardless of whether the funds are transferred or transferred from the Bahamas. Previously, stamp duty was only payable when funds were converted and transferred abroad. As a result of this change, an owner who lives on his or her property for less than six months in a given year will have to pay annual property taxes of 0.75% on the portion of the market value that does not exceed $500,000.00 on January 1, 2019 and 2% on the portion of the market value that exceeds $500,000.00. The following information addresses many of the main concerns of potential buyers when they want to invest in real estate in the Bahamas. We have tried to make it a complete guide to the general rules and regulations, but if you have any further questions, please email us at info@bahamasrealty.com and we will endeavor to answer them for you. The stamp duty exemption for new owners has been extended until 30 June 2023. However, all requests for exemption must be submitted within twelve months of the date of transfer to the applicant. The applicant`s affidavit accompanying the application must now state that there is and has never been any other residence of or on behalf of the applicant in the Bahamas or abroad. As a general rule, stamp duty (50/50) was divided between the seller and the buyer (unless otherwise agreed). This clarification means that the overall tax distribution of stamp duty and VAT can continue to be maintained. Unimproved property owned by the Bahamas, that is, property without physical additions or modifications, or any work that benefits the land and has not increased its market value by $5,000 or more; An approval of the mortgage under section 32 of the Property Act (Ch.

138) or other satisfaction or relief from a mortgage (including satisfaction or discharge of an obligation) The New Fiscal Year of the Government of the Bahamas began on July 1, 2018. Legislative changes that came into force earlier this fiscal year resulted in changes to the real estate taxation system in the Bahamas. The definition of “owner-occupied property” has been amended to remove the phrase “or on a seasonal basis” and to include a requirement that an owner reside on his or her property for at least six months per year. The new definition of the term now reads as follows: “Property inhabited by a person belonging to the fee simple owner or a mortgage debtor lives and resides in that immovable exclusively as a residential immovable on a permanent basis of six months or more”. Are there incentives for indirect taxes (e.g. reduced rates, tax exemptions)? No, but the VAT inspector is empowered to appoint a representative for the purposes of the administration or execution of the act. Yes, but this architect cannot work in the Bahamas without a permit. All construction plans submitted to the Planning Committee and the Ministry of Public Works must be signed by a local licensed architect and a local engineer. As in any jurisdiction, there are local customs and procedures required to do the job, and it is recommended to use the services of local professionals. Easy handling by a shipping or air cargo company, making it easy to move and decorate. A detailed inventory of items of approximate value is required and we recommend that you use local customs before clearing your items. A VAT deferral mechanism is available under the Hotel Promotion Act.

This deferral allows an approved start-up to avoid paying VAT on imports by declaring the import VAT itself in its VAT returns, while claiming input VAT. Jane Adams Director KPMG in the Bahamas T: +1 242 394 9975 E: janeadams1@kpmg.com.bs The rental of a building, premises, structure or other place or part thereof that is not a commercial rental establishment (as defined in the VAT Act) is not considered a commercial transaction. Although these are not professional expenses incurred when buying a residential property, the buyer should keep in mind that the fees of the Homeowners` Association are also subject to VAT. Bahamas Realty Limited is a full-service real estate company. We sell residential and commercial properties including vacant lots, spaces, single-family homes, condominiums, private islands, resort properties, office/retail buildings, shopping malls and warehouses. Is there a reverse charge mechanism for goods or services? In 2014/15, there were a number of legislative changes, one of the most important of which was the introduction of value added tax (“VAT”). VAT is a form of indirect excise duty on the supply of goods and services. This article will examine the impact of VAT on real estate transactions in the Bahamas.

.