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BUYING PROPERTY IN BARBADOS


Below is a guide to buying, selling and owning property in Barbados. There are no restrictions on the purchase of property in Barbados by persons who are non-nationals or permanent residents. There are no capital gains or inheritance taxes in Barbados.


Buying


Transaction Costs • Attorney Fees - Approx. 1% - 2.5% plus VAT • Proportionate amount of Land Tax


Mortgages/Finance


• US$ Mortgages are readily available to non-nationals from the offshore sector of three local commercial banks. Terms vary from bank to bank. Below are a few general guidelines:


- LTV Ratio: varies between 50% - 70% - Minimum loan value: US$500,000 - Interest rates are pegged against international LIBOR rate - Amortization term: range from 15 - 25 years maximum or retirement • Attorney fees vary by attorney and should be obtained from individual attorneys


Standard Purchase Procedures • Verbal offer and acceptance (in some cases a reservation agreement may apply)


• Appoint an attorney-at-law • Exchange of contracts for sale and payment of a 10% deposit to Vendor’s attorney-at-law within 2 to 4 weeks • Conveyance and payment of 90% within 3 to 6 months (in the case of off-plan developments, stage payments based on construction progress may apply)


• Foreign currency brought into the island as well as funds borrowed by non-nationals should be registered with the Central Bank of Barbados


Owning


Annual Costs • Property Insurance - US$2.50 to US$3.25 per US$500 • Contents Insurance - US$3.00 to US$3.75 per US$500 • Land Tax: Improved Value - Residential - First US$95,000 - 0%


- On >US95,000 but <US$250,000 - 0.1% - On > US250,000 but <US 625,000 - 0.45% - On > US 625,000 - 0.75% Improved Value - All Other Properties - 0.5% Site Value - Unimproved Land - 0.6%


Property tax is capped at a maximum of US$30,000 on residences • Municipal Solid Waste Tax: 0.3% of site value of improved properties for both residential and commercial. NB. there is no cap.


Monthly Costs • Electricity, Water, Telephone, Cable • Condo fees, if applicable - see chart for a guide by property • Pool and garden maintenance, if applicable


Property Management • Management Fee - minimum of US$250


Landlord Rental Fees 1. Long Term Rentals • 1 month rent - 1st year • 1/2 month rent - 2nd year • 1/4 month rent - 3rd year 2. Short Term Rentals


• 10% to 30% commission is payable on short term rentals Eligibility


Non-nationals who are either: • High Net Worth Individuals: Owning assets of US$5 million or more, or


• Owners of property not subject to mortgage, or investments purchased in Barbados valued at US$2 million or more with funds originating outside of Barbados


Fees For Retired Persons • Retired persons over 60 years: US$5,000 • Retired persons under 60 years: US$3,500


Fees For Employed Persons Over 60 years • Special Entry Permit: US$5,000; plus • Indefinite work permit: US$15,000; or • Annual work permit: US$1,500


Fees For Employed Persons Under 60 Years Option 1:


• Special Entry Permit: US$5,000; plus • Indefinite work permit: US$20,000 Option 2:


• Special Entry Permit: US$3,500; plus • Annual work permit: US$1,500


Fees For Non-Executive Directors • Special Entry Permit: US$5,000; plus US$500 annually


Fees For Dependants • US$150 per dependent


Selling


Transaction Costs • Attorney Fees - Approx. 1% - 2.5% plus VAT • Agents’ Fees - 4% to 5% + VAT (Includes marketing, viewing, signage etc.) • Stamp Duty - 1% • Property Transfer Tax: Unimproved property - 2.5% Improved property - First US$75,000 exempt Improved property - Amounts over US$75,000 - 2.5%


Standard Selling Procedures • Verbal offer and acceptance • Appoint an attorney-at-law • Exchange of contracts within 2 to 4 weeks • Provision of copies of prior deeds • Draft conveyance sent to Purchaser’s attorney for perusal • Signing of Conveyance within 3 to 6 months


The Following Bills Must Be Fully Paid • Land Tax


• Municipal Solid Waste Tax • Water


Special Entry & Reside Permit (SERP)


The fees charged by the Barbados Immigration Department for Special Entry and Reside Permits, which are valid for 5 years.


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