Closing Costs

Government Value Added Tax

  • 10% Government VAT on all property transactions valued at $100,000 or more. 2.5% on property transactions valued at less than $100,000. The usual practice in the Bahamas is for the tax to be shared equally between buyer and seller unless otherwise agreed upon.
  • A 12% Value Added Tax (VAT) is charged on real estate services, including appraisals, legal work and commissions.

Laws and policies are subject to change. For more information on the current VAT Discounts in the SERZ click here.

Legal Fees

Depending on the size and complexity of the transaction, attorneys’ fees generally average between 1.5% and 4% of the transaction price, plus out of pocket disbursements, and VAT.

Bahamas Real Estate Commission

(established by the Bahamas Real Estate Association)

  • Developed property: 6%
  • Undeveloped property (vacant land): 10%

Annual Real Property Tax Rates

The rates of tax on real property are as follows:

Owner-occupied property (Limit: One per person; May be a vacation rental home):

  • The first $250,000 of market value is tax exempt
  • More than $250,000 and not exceeding $500,000 of market value is 0.625%
  • More than $500,000 and not exceeding $5,000,000 of market value is 1%
  • More than $5,000,000 of market value is 1/2%

Unimproved property: (other than unimproved property exempt by virtue of Section 39 of the Real Property Tax Act)

  • First $7,000 of market value is $100
  • More than $7,000 of market value 1½%.

Other property:

  • First $500,000 of market value is 1%
  • More than $500,000 of market value is 2%

Properties Exempt from Real Property Tax:

  • Property owned by Bahamians and situated in the Family Islands is exempt from property tax. Property approved as commercial farm land (by the Minister of Agriculture and Marine Resources, and the Minister Finance) may be eligible for property tax exemptions.
  • Unimproved property owned by Bahamians, meaning property without physical additions or alterations, or any works benefitting the land which have not increased the market value thereof by $5,000 or more;
  • Places of religious worship; school buildings and their gardens and playing areas;
  • Property owned by foreign governments;
  • Property owned by foreign nations used for consular offices or residences of consular officials and employees;
  • Property used exclusively for charitable or public service from which no profit is derived
  • Property owned by a non-Bahamian under the Special Economic Recovery Zone Order may apply for exemption for up to three (3) years if the property is habitable by October 2020.

Permanent Residence Status

Overseas persons investing in a residence valued at $750,000 and over, may apply to the Department of Immigration for Permanent Residency status. Holding a Permanent Residency certificate can lead to significant tax advantages in your home country. Accelerated consideration for a Permanent Residency certificate is offered to purchasers of a residence (home or condo) of $1,500,000 or more.

Annual Homeowners Residence Card

Available to any homeowner in The Bahamas. Obtained from the Director of Immigration, it allows the permit holder, and family, to enter and remain in The Bahamas for the period of the permit.

Shipping Furniture And Household Items

There are several freight forwarding companies and air freight companies out of Florida that make shipping easy. A detailed inventory of items with approximate value is needed. Using a local customs agent to clear your goods is recommended.
For more information on air & sea freight services click here.
For more information on customs duty exemptions in the SERZ click here.

Architects, Builders And Decorators

Qualified professionals are available for any size of job from remodeling to new construction.

Financing

Local banks offer BSD$ and US$ Mortgages to finance the purchase of a home or property in the Bahamas.

Bahamas Government Value Added Tax (VAT)

As of July 1, 2018, The Bahamas Government has imposed a 12% Value Added Tax (VAT) on Real Estate Commissions and Legal Fees.

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