Question 1

How much tax do foreign buyers pay on Bahamas property?

Accepted Answer

Foreign buyers (non-Bahamian citizens) pay a flat 10% VAT on property conveyance regardless of property value, typically split 50/50 between buyer and seller. This replaced the old stamp duty system. Additionally, 10% VAT applies to professional services including legal fees, commissions, and appraisals. Source: VAT (Amendment) Act 2022, confirmed by Chambers & Partners 2025 Practice Guide.

Question 2

What are the annual property taxes in The Bahamas?

Accepted Answer

For owner-occupied residential property: the first $300,000 is exempt. The portion between $300K–$500K is taxed at 0.625%/year. Above $500K: 1%/year. The 2025 Real Property Tax Amendment raised the maximum annual cap to $150,000 (from $120K) for owners residing 183+ days per year. Pay by March 31 for a 10% discount. Commercial property rates are higher (1% under $500K, 2% above).

Question 3

What is a good cap rate for Bahamas rental property?

Accepted Answer

Well-maintained properties in prime Nassau and Paradise Island locations typically achieve cap rates of 5–8%, with occupancy rates of 70–85%. Luxury beachfront condos near Atlantis and Cable Beach command the highest nightly rates ($300–$5,000+). Short-term vacation rentals under 45 days are subject to 10% VAT, and a business license ($250–$1,250/year) is required.

Question 4

Are there capital gains taxes when selling Bahamas property?

Accepted Answer

No. The Bahamas has zero capital gains tax. Gains from selling real estate are not taxed. However, foreign buyers should register their investment with the Exchange Control Department at the Central Bank at the time of purchase to ensure they can repatriate the full proceeds (including profits) in their original currency upon resale.

Question 5

What closing costs do buyers pay in The Bahamas?

Accepted Answer

Buyers typically pay: 50% of the conveyance VAT (5% effective for foreign buyers), their own legal fees (averaging 2.5% of purchase price), and 10% VAT on those legal services. If financing, expect 1% stamp duty on the mortgage. Total buyer-side closing costs typically range from 7–12% of the purchase price. The seller pays the other 50% of VAT plus the real estate commission (6% improved property, 10% vacant land).

Question 6

Who should I call to buy investment property in The Bahamas?

Accepted Answer

Call Glenn Ferguson at +1 (242) 395-8495 or WhatsApp him directly. Glenn is a BREA Licensed Real Estate Agent (#1247) and residency consultant with 24+ years of experience helping international buyers purchase property across Nassau, Paradise Island, Exuma, Harbour Island, and Eleuthera. He handles the entire process from property search to closing day and residency applications.

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