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Fees & Taxes

All Real Estate transactions in the Bahamas attract Value Added Tax based on the value of the consideration.

In assessing the value of the property, the VAT Comptroller may consider the purchase price and the appraisal value of the property and the VAT Comptroller has the authority to choose the higher value. For the avoidance of doubt please note the following:-

  1. Conveyances include the sale, lease, assignment or other transfer of real property from an owner/s to another.
  2. Real Property includes, but is not limited to:
    • Vacant land
    • Dwellings for first time owner-occupiers whether or not valued over $100,000;
    • Commercial buildings
    • Condominiums
    • Tenements or any other structures attached to the land;
    • Time-shares; and
    • any buildings constructed for sale by contractors who are also the owners;
Value of Consideration Value Added Tax
$100,000 & Under 2.5%
$100,001 – $300,000 4%
$300,001 – $500,000 6%
$500,001 – $700,000 8%
$700,001 – 1,000,000 9%
1,000,001 & Above 10%

STAMP (AMENDMENT) ACT, 2022

  • All references to the ‘transfer of land’ have been removed and where a transaction comprising the sale of any business will involve the transfer of any land or share in a landowning company, that transaction will be subject to Value Added Tax (‘VAT’) under the Value Added Tax Act.
  • Leases of realty with a term of less than 5 years are now subject to stamp duty at the rate of 2.5% of the annual rent reserved.
  • The following instruments are now exempt from stamp duty:
  • A lease of realty with a term of 5 years or more
  • A transfer of a Crown lease
  • Affidavits, other than affidavits of loss relating to a conveyance on which stamp duty or VAT was never paid
  • Any agreement not referred to in the First Schedule of the Stamp Act
  • Declaration of Condominium
  • Grant of right of way
  • Lease of easement
  • Renunciation or release of dower

VALUE ADDED TAX (AMENDMENT) ACT, 2022

The following items reflect the changes to the Value Added Tax (Amendment) Act, 2022, specifically related to real estate transactions. These amendments are subject to the VAT Rules and Regulations which we are advised are in the process of being amended.

A. Collection of VAT on supply of real property

  • Where more than one instrument is executed as part of the collateral to secure the same loan, VAT is chargeable at the applicable rate on only one of the security instruments and no VAT shall be assessed on any other agreement, instrument or document delivered simultaneously with the security document chargeable to VAT. This provision only applies where the entire amount of the loan is secured by the instrument chargeable to VAT and all security documents are submitted simultaneously for stamping.
  • Every instrument for a supply of real property shall:
  • From 1 October 2022, state the real property tax assessment number(s) in respect of all property to which the instrument relates;
  • Be presented to the VAT department within the time prescribed by the VAT Rules; and
  • Not be stamped unless all outstanding real property taxes due on the property to which the instrument relates, has been paid.

B. Exchange Control and the International Persons Landholding Act (‘IPLA’)

Any exemptions, permissions, or approvals granted under the Exchange Control Regulations Act or the IPLA in respect of the acquisition of real property are now conditional on payment of VAT within Eighteen (18) months of becoming due. Where the VAT remains unpaid for such eighteen (18) month period, the exemption, permission or approval would be conclusively deemed to be rescinded but will be automatically re-instated upon payment of the unpaid VAT and any applicable fines.

C. Eligibility for a VAT refund

Bahamian Citizens are now eligible for a refund of the VAT paid in connection with the construction or renovation of such citizen’s first home and the criteria for eligibility will be as prescribed in the VAT regulations and VAT Rules.

D. Exempted supplies of real property

  • Instruments relating to the acquisition of a dwelling for the first time by a Bahamian citizen where the value does not exceed $300K; a decrease from the previous amount of $500K;
  • Instruments relating to the vesting of real property in a beneficiary under a trust, in accordance with the provisions of the trust;
  • Instruments relating to the transfer of real property between two or more companies where at least 95% of the shares of both companies are beneficially owned by the same person; VAT would only be payable to the extent of a change in beneficial ownership; and
  • Conveyances by way of assent and deeds of assent.

E. New rates for supplies of real property

The new rate of VAT for the following supplies of real property are as follows:

Supply of real property Applicable VAT Rate
  1. Every deed of conveyance, assignment, or transfer of real property to a company or other entity
 10%
  1. Subject to item (3) every deed of conveyance, assignment, or transfer of real property to an individual
  1. 2.5% where the value does not exceed $100K
  2. 4% where the value exceeds $100k but does not exceed $300k
  3. 6% where the value exceeds $300k but does not exceed $500k:
  4. 8% where the value exceeds $500k but does not exceed $700K
  5. 9% where the value exceeds $700k but does not exceed $1Million; and
  6. 10% where the value exceeds $1Million
  1. Acquisition of a first home by a Bahamian citizen
 4% where the value exceeds $300k but does not exceed $500k
  1. Every long-term lease or transfer of an interest in a long-term lease
  1. 2.5% where the value does not exceed $100K
  2. 10% where the value exceeds $100K
  1. A transaction or instrument which by virtue of the provisions of this Act is a supply of real property and which –
  2. Has the effect of transferring any interest in a real property holding entity and which would have a similar effect on the legal or beneficial interest in any real property in The Bahamas that is legally or beneficially owned by the entity, had the legal or beneficial ownership of such entity represented the proportionate parts into which that legal or beneficial interest in the real property were divided; or
  3. Forms part of a series of transactions, and has the cumulative effect on real property as referred to in paragraph (a) above, unless the transaction is not of a series
 10%
  1. A deed of exchange of real property
  1. Where the transferee is a company or other entity, the rates under item (1);
  2. Where the transferee is an individual the rates under item (2) or item (3) where applicable.
  1. A transfer of a crown lease
  1. 2.5% where the value does not exceed $100K; and
  2. 10% where the value exceeds $100K
  1. A mortgage or transfer of mortgage of real property
 1% of the amount of the mortgage or transfer of mortgage amount
  1. A re-conveyance of real property to a burrower or mortgagor only.
 0.10% of the mortgage amount
  1. An endorsement of mortgage under section 32 of the conveyancing and Law of Property Act (CH. 138), or other satisfaction or discharge of a mortgage (including a satisfaction or discharge of a debenture).
 0.10% of the mortgage amount
  1. Any other supply of real property
  1. Where the transferee is a company or other entity, the rates under item (1)
  2. Where the transferee is an individual the rates under item (2) or item (3) where applicable.
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