Will I have to pay tax when I invest in property in Barbados?
Certain taxes are imposed when buying and selling the property. For example, when you buy there is VAT of 17.5% on your lawyer’s fee. If you’ve bought as an offshore company, there is property transfer tax of 2.5% and stamp duty of 1% payable when you sell. You do not pay this as a buyer.
Income tax is another matter and depends on where you are resident/domiciled for tax purposes. Good news: Double taxation treaties—meaning you don’t pay twice on the same income—are in effect between Barbados and 43 other countries. There is no Capital Gains Tax in Barbados.
What about Land Tax? On un-improved residential land (i.e. without a dwelling on it,) you’ll pay 0.6% of the site value.
On improved land, the first US$95,000 is exempt. On the excess greater than US$95,000 but not exceeding US$250,000, land tax rises to 0.1%. On the excess greater than US$250,000 but not exceeding US$625,000, tax is 0.45% On the excess greater than US$625,000, it’s 0.75%.
Thinking of renting out the home you buy? You’re in luck. Barbados Vvillas rented to the tourist market and registered with the Barbados Tourism Authority (BTA) will be calculated on 75% of the tax demanded. In other words, you get a 25% break. Do not worry about all the details, we have a network of professionals that will work with you and your goals to find the best solution for you.