Business Information

APPLICATION FOR PERMISSION TO PURCHASE OR ACQUIRE REAL PROPERTY IN THE BAHAMAS

A Permit to Acquire Property is required by all non-Bahamians acquiring an interest in land if the property is undeveloped land with two or more adjoining acres. A Permit is also required if the intended use is not as an owner-occupied property.

Non-Bahamians

Acquiring an interest in land if the property is undeveloped land
Acquiring an interest in two or more adjoining acres

Bahamians are also required to apply for a permit where the intended use is not as an owner-occupied property.
Process

Complete the entire Form below.
Submit it to the Secretary to the Investments Board, along with the list of documents identified below.
As applicable, the application is also reviewed by the Securities & Intelligence Branch of the Royal Bahamas Police Force and Government Ministries, depending on the nature of commercial activity proposed.
Once approved, an approval letter is prepared.
Upon receipt of an approval letter, the applicant must pay the required fee at the Public Treasury.
A copy of the receipt must be returned to the Investments Board.  The Board then issues the Permit to Acquire Property.

Application Form(s)

**NB. Current means dated not more than six months prior to submission to the Investments Board.
Turn-around time  – A determination is communicated within 30 days following the submission of all documents.
Deadline  – All approval letters are valid for one year from the stated date. Therefore, it must be reapplied for, if needed, before the initial approval has expired.
Related Fee(s) – Applicant must pay a fee of BS$500.00, which can be paid at the Public Treasury.  If accessing this service from a Family Island, the requisite fee may be paid at the Public Treasury offices on Grand Bahama or Abaco.

REAL ESTATE TAXES IN THE BAHAMAS

The Government Stamp Tax on Property Conveyances
The Government Stamp Duty (tax on the conveyance of real property). This is a graduated tax. The total amount of the tax is calculated as follows:

When the value of the consideration is less than or equal to $20,000, the rate is 4%
When the value of the consideration is greater than $20,001 and is less than or equal to $50,000, the rate is 6%
When the value of the consideration is greater than $50,001 and is less than or equal to $100,000, the rate is 8%
When the value of the consideration is greater than $100,001, the rate is 10%

The usual practice in the Bahamas is for the tax to be shared equally between buyer and seller unless otherwise agreed upon.

First time buyers may be exempted from stamp tax on a dwelling house or vacant land purchased for a dwelling house, up to the value of $500,000.

Real Property Tax

The statutes provide for a general assessment of real property by the Chief Valuation Officer of the Commonwealth of the Bahamas. This applies to Bahamians and non-Bahamians owning real property in the Bahamas not exempt from taxation as indicated in “Remarks”. “Bahamian” is defined as a citizen of The Bahamas or a company registered under The Companies Act in which at least 60% of the shares are owned beneficially by Bahamians. The returns are due on or before December 31 each year and must be filed with the Chief Valuation Office.

Owners must file a Declaration of Real Property. The return must be signed by the owner and witnessed by an “authorized person”, defined as a magistrate, attorney, registered medical practitioner, bank officer, minister of religion, justice of the peace or notary public within the Bahamas or similar person outside of the Commonwealth. Such forms may be obtained from the Chief Valuation Officer.

Property is assessed before October 15. The Chief Valuation Officer, if it appears that any property subject to assessment has not been assessed, may assess the property retroactively to a maximum of 10 years at the required amount.

The Chief Valuation Officer is required to publish before October 15 (once in the Gazette and once in a daily newspaper published and circulated in The Bahamas), a notice stating that:

Copies of the assessment lists are available to the public at the Treasury and office of the Chief Valuation Officer;
Assessment notices for each owner of property liable to tax are available at places specified in the notice,
Five days after the notice’s publication, a notice of assessment is deemed served on every owner of property subject to tax.
A notice of assessment may be sent by mail to any owner of property by the Chief Valuation Officer after publication in the Gazette
Any other matters deemed necessary by the Chief Valuation Officer, with the Minister’s approval.

Objection to a notice of assessment must be made in writing to the Chief Valuation Officer, within 30 days of service of the notice, stating grounds upon which the objection is made. The Chief Valuation Officer may request that the tax levied be paid in whole or in part at the time of objection.

Taxes are due within 60 days of the date on which the assessment notice is deemed to have been served. Also, payment of one or more quarterly installments must be made within those 60 days. These payments should be made to the Public Treasury in Bahamian or US dollars, preferably as a bank draft or international postal order. Personal cheques are not accepted unless bank certified. Foreign cheques must be bank-certified and drawn on a bank in the US or The Bahamas.

Rates of Taxes

The rates of tax on real property are as follows:

In respect of owner-occupied property:

The first $250,000 of market value is tax exempt
More than $250,000 and not exceeding $500,000 of market value is ¾%
More than $500,000 and not exceeding $5,000,000 of market value is 1%
More than $5,000,000 of market value is .25%

In respect of 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%.

In respect of any other property:

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

Market value is defined as the amount the property would realize, if sold in the open market, without any encumbrances or restrictions. If the return is not filed, the owner is guilty of an offense, and upon conviction thereof, may be fined. Persons knowingly making false statements may be liable to fines, imprisonment, or both fines and imprisonment. If the tax is not paid on or before the last day the tax becomes due, a surcharge will be added.

In the case of an extension of time, the Chief Valuation Officer may postpone the date on which the tax is payable in a particular case, by notice in writing.

AREAS ESPECIALLY TARGETED FOR INTERNATIONAL INVESTORS

    Touristic Resorts.
    Upscale Condominium, Time share and Second Home Development.
    Information and Data Processing Services.
    Assembly Industries.
    High-Tech Services.
    Ship Repair and other services.
    Light Manufacturing for export.
    Agro-Industries.
    Food Processing.
    Mariculture.
    Banking and other Financial Services.
    Captive Insurance.
    Aircraft Services.
    Pharmaceutical manufacture.
    Off-shore Medical Centres.

NB.  This list is not exhaustive and investors interested in areas not included here are encouraged to bring their interest to the attention of the BIA.

INVESTMENT INCENTIVES

The attractiveness of a low-tax environment and a stable currency are enhanced by a series of investment incentives that provide relief from customs duties on approved raw materials, equipment and building supplies, as well as allowing exemptions from real property taxes for up to 20 years.

The following incentives are open to any qualifying individual or firm:

The Hotels Encouragement Act — Provides duty free entry of approved construction materials, furnishings and fixtures for hotel development as well as provides for exemption/concession from real property tax for the first twenty years of operation of a hotel/resort.

Hotels with as few as four guest rooms on a Family Island and those with a minimum of ten rooms in New Providence qualify for concessions under the Hotels Encouragement Act.

The act has been amended to also include shops and restaurants, which have a touristic component, and entertainment facilities.

The Industries Encouragement Act — Provides duty-free concessions for the importation of machinery, raw materials and building supplies for manufacturing entities in addition to exemption from Real Property Tax for a 15 year period.

Duty free concessions for applicants is valid for the first five years of operation.  Thereafter, applicants would be required to pay a reduced rate of duty (10%) on all approved materials and equipment imported.

The Bahamas Vacation Plan and Time Sharing Act — Provides duty-free concessions for building supplies for the construction of timeshare facilities.

The Free Trade Zones Act — Designates areas within The Bahamas as free industrial and commercial zones.

The Hawksbill Creek Agreement Act — Allows the Port Area that is the free trade zone of Freeport, Grand Bahama, freedom from all taxes until 2015 and from excise taxes, stamp duties and most customs duties until 2054.

The Tariff Act — Allows for customs duty exemption on specified raw materials, supplies and equipment for Agriculture, Floriculture, Horticulture, Fisheries, Forestry, Cottage and Light Industries, and Commercial Printing.

The Export Manufacturing Industries, Encouragement Act,  The Agricultural Manufactories Act, The Spirits and Beer Manufacture Act —  Investment incentives under these acts include exemption from the payment of customs duties on building materials, equipment and approved raw materials and real property taxes for periods  up to 20 years.

The City Of Nassau Revitalization Act — Provides incentives and duty concessions in connection with the restoration, repair and upgrade of buildings, commercial and residential, in the City of Nassau.

The Family Island Development Encouragement Act — Provides duty concessions on the importation of building materials, equipment and supplies for commercial and/or residential developments on specified Family Islands.

 

ESTABLISHING A BUSINESS IN THE BAHAMAS

The Commonwealth of The Bahamas welcomes International Investors who wish to establish a business in The Bahamas.  All non-Bahamians or Permanent Residents seeking to do business in The Bahamas must submit a Project Proposal to the Bahamas Investment Authority (BIA).

Additionally, from time to time the Government of the Bahamas offers targeted investment incentives for particular types of projects.  All non-Bahamians, Permanent Residents or Citizens seeking to access concession pursuant to the Government’s targeted investment incentive must also submit a Project Proposal to the Bahamas Investment Authority (BIA).

There are no requirements for Bahamians to qualify for this service.  Non-Bahamians must meet a minimum capital investment of BS$500,000 and the proposed investment must not be in an area reserved for 100% Bahamian participation.

Eligibility

Interested persons must:

Be Non-Bahamian.
Have a minimum investment of BS$500,000.00
Be interested in an area that isn’t reserved for 100% Bahamian participation

Process

Submit a Project Proposal, along with supporting documents to the Bahamas Investment Authority.
The BIA will process the application and submit the same to the National Economic Council for a determination.
Depending on the nature of the proposed business activity, the relevant Government Ministry or Agency would be consulted for input:
Ministry of the Environment.
Ministry of Works and Transport.
Ministry of Housing.
Respective Family Island Local Government.
Once a determination has been made, the BIA will communicate to the applicant in writing.
Once approval is obtained, the BIA also coordinates with other Government agencies and facilitates the implementation of projects.
Application Form(s)

 FREQUENTLY ASKED QUESTIONS

What is National Economic Council (“NEC”)?

The National Economic Council, headed by The Prime Minister, is responsible for the executive management of the National Investment Policy and is the decision making body in respect of all commercial projects undertaken by foreign direct investors.

How do I establish a business in The Bahamas?    

An international investor seeking to do business in The Bahamas should submit to the Bahamas Investment Authority a Project Proposal, along with supporting documents.

Do you have Project Proposal Guidelines?

Yes.

What are the investment areas targeted for Foreign Investors?

a) Touristic resorts

b) Upscale condominium, timeshare and second home development;

c) Marinas;

d) Information / data processing;

e) Assembly industries;

f) High-tech services;

g) Ship registration, repair and other ship services

h) Light manufacturing for export;

i) Agro-industries;

j) Food processing;

k) Mari culture

l) Banking and other financial services;

m) Captive Insurance;

n) Aircraft services;

o) Pharmaceutical manufacture;

p) Offshore medical centres;

q) Wholesale distribution of any product produced locally

Please N.B.

Investors interested in areas not included in the list should contact the Bahamas Investment Authority;
Joint Ventures with Bahamian partners are encouraged, with the choice of partner being at the discretion of the investor;
Investments of less than $500,000.00 will not be considered.

How many work permits would my business be entitled to? 

Necessary work permits for key personnel will be granted. Businesses requiring permits for persons other than key personnel are encouraged to discuss these requests with The BIA in advance.

How can I become an International Owner of Second Homes?   

Overseas Investors may acquire residential properties in The Bahamas of up to two acres without prior Government approval. Such acquisitions are required to be registered in accordance with the International Persons Landholding Act.   Second Home Owners are eligible for a Home Owners Residence Card, renewable annually.  Please N.B.  This card will:  Facilitate entry into The Bahamas and entitle the owner, his spouse and minor children to enter and remain in The Bahamas for the duration of the validity of the card.  Application may be made to the Director of Immigration.

Am I eligible for Annual or Permanent Residence?

Accelerated consideration of application for Permanent Residence will be given to:

i) Major International Investors; and

ii) Fit and proper owners of residence valued at $1,500,000.00 or more.

Why should I invest in the Bahamas?

A politically stable environment conducive to private investment
An atmosphere where investments are safe and the expropriation of investments capital is not a considered option;
A legal environment based on a long tradition of Parliamentary Democracy, the rule of constitutional and statue laws and where security of life and personal property is guaranteed;
A stable macroeconomic environment bolstered by a prudent fiscal policy, a stable exchange rate, flexible exchange control rules and free trade;
An environment in which freedom from Capital Gains, Inheritance, Withholding, Profit Remittance, Corporate, Royalties, Sales,l Personal Income, Dividends, Payroll and Interest Taxes are ensured;
Essential public service, an adequately equipped police constabulary, modern health and education facilities and other social services;
Dependable Public Utilities; and
Essential Public Infrastructure such as roads, ports and airports.

Does The Bahamas encourage Joint Ventures?

International Investors are encouraged to establish joint ventures with Bahamian partners. The choice of such Bahamian partners is in the absolute discretion of the investor.