Barbados Property Buying and Selling costs
In a nutshell – costs when buying are very low. Costs when selling are quite steep.
This is because transactions attract Stamp Duty and Transfer tax which are paid by the vendor. In addition the fee charged by an Estate Agent to sell a property in Barbados is usually between 4% and 5%.
Costs when buying
- Legal Fees (there is a statutory scale which is quite complicated to calculate and is based on the price of the property). These are between 1% and 2% of the purchase price.
- Survey (optional). Price dependant on type and value of property.
- You will also be required to pay proportionate amount of Land Tax for the balance of the current year (this is the equivalent of Council Tax in the UK).
Costs when selling
- Legal Fees (there is a statutory scale which is quite complicated to calculate and is based on the price of the property). These are between 1% and 2% of the sale price.
- Estate Agent Fee. Usually between 4% and 5%.
- Transfer Tax. 2.5% of sale price
- Stamp Duty. 1% of sale price.
Total selling costs are typically about 10% of the sale price. Your “exit strategy” needs serious thought, bearing in mind it is difficult to extract any “profit” from a property from Barbados if you sell. There is however no Capital Gains tax. Professional advice is advised if or when you intend to sell or bequeath your property.
Buying in an offshore company
You can buy property in an offshore company structure. British Virgin Islands (BVI companies) are the most widely used. There are other jurisdictions which are cheaper, e.g. St Lucia. Buying this way, you will avoid having to pay Transfer Tax and Stamp Duty when you subsequently sell the property (company). However the costs of setting up the company and filing annual accounts only make this viable if the property value is in excess of $USA 1 million.
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