Bahamas Residency for British Investors

Why British Investors Choose The Bahamas

The abolition of the UK non-domiciled tax regime from 6 April 2025 under the Finance Act 2025 has fundamentally changed the calculus for internationally mobile British wealth. Where the remittance basis previously shielded foreign income and gains (FIG) from HMRC, all UK tax residents are now taxed on worldwide income on the arising basis. The Bahamas, a fellow Commonwealth nation operating under English common law derived from the same legal tradition as England and Wales, imposes no personal income tax, no capital gains tax, no inheritance tax, and no corporation tax. The Knight Frank 2025 Wealth Report identifies The Bahamas as a top-three destination for British UHNW individuals seeking tax-efficient residency. Economic Permanent Residency (EPR), a lifetime residency right granted through real estate investment of $1,000,000 or more, provides British investors with a legitimate, HMRC-recognised pathway to establishing non-UK tax residency under the Statutory Residence Test (SRT).

Sources: HMRC (2025/26 rates), Finance Act 2025, GOV.UK (CGT allowances), Bahamas Department of Inland Revenue (Real Property Tax Act), Central Bank of The Bahamas, Bahamas High Commission London (TIEA), Knight Frank 2025 Wealth Report.

Getting to The Bahamas from the United Kingdom

British citizens can enter The Bahamas without a visa for tourism or business stays of up to 3 months, extendable to a maximum of 8 months through the Bahamas Department of Immigration. According to GOV.UK Foreign Travel Advice and the Bahamas High Commission in London, you need only a valid British passport with at least 6 months validity beyond your departure date. As a fellow Commonwealth nation, The Bahamas waives visa requirements for all United Kingdom citizens under longstanding bilateral agreements.

Direct flights: British Airways BA253 departs London Heathrow daily (Terminal 3), arriving at Lynden Pindling International Airport (NAS) in approximately 9 hours 10 minutes. Return flight BA252 departs Nassau daily, arriving Heathrow the following morning. Connecting options via Miami (American Airlines), New York JFK (JetBlue, Delta), and Toronto (Air Canada). Private aviation at Nassau's Odyssey Aviation FBO.

Passport requirements: Your British passport must be valid for at least 6 months from your date of entry. British Overseas Territories Citizens (BOTC), British Overseas Citizens (BOC), and British National (Overseas) passport holders should check with the Bahamas High Commission London for specific entry requirements.

Once you hold EPR: Economic Permanent Residency eliminates all visa restrictions. You can enter and exit The Bahamas freely at any time, on any airline, with no time limits and no need to show proof of onward travel.

Economic Permanent Residency for British Investors

Economic Permanent Residency (EPR) is a lifetime residency right granted by the Bahamas Department of Immigration to foreign nationals who invest $1,000,000 or more in Bahamas residential real estate. The threshold increased from $750,000 to $1,000,000 on 1 January 2025, as confirmed by the Bahamas Immigration Department and Lennox Paton's March 2025 legal advisory published in the Legal 500 Bahamas Real Estate Guide. EPR is governed by the Immigration Act of The Bahamas and grants the holder the right to reside in The Bahamas indefinitely.

Sources: Bahamas Immigration Department (immigration.gov.bs), Lennox Paton Attorneys (March 2025), Legal 500 Bahamas Real Estate Guide (March 2025), Bahamas Bar Association (January 2026 fee schedule).

Property tax (owner-occupied)

Residency requirement: EPR holders must spend a minimum of 90 days per year in The Bahamas. The 90 days can be split across the year, making it ideal for those who want to spend British winters in The Bahamas while maintaining a UK summer base.

Hold period: The property must be held for a minimum of 10 years. Selling before 10 years may jeopardise your EPR status.

Family inclusion: Spouse and dependent children under 18 endorsed on the EPR certificate at $300 per person. Children who turn 18 need to apply separately. Note: under current Bahamian immigration law, the endorsement language refers to the "wife" of the EPR holder — meaning female EPR holders may face limitations endorsing a husband. Consult your Bahamian attorney on this gender-specific restriction.

5-acre rule: Foreign buyers (including British citizens) purchasing property exceeding 5 acres require approval from the Bahamas Investments Board under the International Persons Landholding Act. Standard residential purchases under 5 acres require only registration with the Investments Board — no approval needed. Glenn handles all registration paperwork.

Home Owner's Residence Card: All foreign property owners should obtain a Home Owner's Residence Card from the Department of Immigration. This card allows you to enter and exit The Bahamas as a property owner (separate from EPR) and is renewable upon proof of ownership.

Non-Dom Abolition, HMRC & Establishing Non-UK Tax Residency

The UK non-domiciled (non-dom) tax regime was abolished from 6 April 2025 under the Finance Act 2025, ending over 200 years of domicile-based taxation. All UK tax residents, regardless of domicile, are now taxed on worldwide income and gains on the arising basis. The remittance basis is no longer available from the 2025/26 tax year onwards. For British investors, establishing non-UK tax residency through Bahamas EPR is now the primary legitimate route to removing worldwide income from HMRC's jurisdiction.

Statutory Residence Test (SRT)

Whether you are UK tax resident is determined by the SRT under Part 1 of the Finance Act 2013. The SRT considers days spent in the UK, ties to the UK (UK property, UK-based spouse, UK employment, children at UK schools), and whether you have a home in the UK. To become non-UK tax resident: fewer than 16 days in the UK if you have been UK resident for at least 12 of the previous 14 tax years, or fewer than 46 days if you were not UK resident in all of the preceding 3 tax years. Professional advice on your specific circumstances is essential.

4-Year FIG Regime

Individuals who become UK tax resident after at least 10 consecutive tax years of non-UK residence can claim complete relief from UK tax on foreign income and gains for up to 4 tax years. If a British investor moves to The Bahamas, establishes non-UK residence for 10 full tax years, and then returns to the UK, they could benefit from 4 years of FIG relief. A claim must be made for each tax year via Self-Assessment.

Temporary Repatriation Facility (TRF)

For former remittance basis users with unremitted pre-April 2025 foreign income and gains: designate and pay a reduced rate of 12% for 2025/26 and 2026/27, rising to 15% for 2027/28. TRF designations must be made by 5 April 2028. After this date, all remittances will be taxed at standard rates (up to 45%).

Capital Gains Tax (CGT)

UK residents pay CGT at 18% (basic rate) or 24% (higher and additional rate) on gains from all assets, including foreign property, for 2025/26. The annual CGT exemption is GBP 3,000. If you cease UK tax residency and sell Bahamas property while non-UK resident, the gain is generally outside UK CGT provided you remain non-UK resident for at least 5 full tax years under the temporary non-residence anti-avoidance rules in Schedule 45 of the Finance Act 2013. Business Asset Disposal Relief (BADR) rate rises from 14% to 18% from 6 April 2026.

UK-Bahamas TIEA

The United Kingdom and The Bahamas signed a Tax Information Exchange Agreement (TIEA) on 29 October 2009 at the Ministry of Finance in Nassau. This allows HMRC to request tax information from Bahamas authorities in relation to specific investigations. It is not a full double taxation agreement. Because The Bahamas imposes no income tax, double taxation does not arise in practice.

Inheritance Tax Planning for British Investors

The Bahamas has no inheritance tax, no estate duty, and no death duty. In the UK, IHT applies at 40% on estates exceeding the nil-rate band (NRB) of GBP 325,000, frozen since 2009 and confirmed frozen until 2030-31. An additional residence nil-rate band (RNRB) of GBP 175,000 applies when a home passes to direct descendants, but tapers away entirely for estates above GBP 2 million.

New Long-Term UK Resident Test (from 6 April 2025)

The Finance Act 2025 replaced domicile-based IHT rules with a residence-based long-term UK resident test. You are a long-term UK resident if you have been UK tax resident in at least 10 of the previous 20 tax years. After leaving the UK, a graduated tail period applies:

Source: HMRC Internal Manual IHTM47020 (Long-Term UK Residence Test), Finance Act 2025, KPMG UK Budget Analysis (2024).

After 10 consecutive years of non-UK residence, the long-term residence test resets entirely. UK-situs assets (such as UK property) always remain subject to UK IHT regardless of residence status.

Pension IHT Changes (from 6 April 2027)

From 6 April 2027, most unused pension funds and death benefits will be included within the value of your estate for IHT purposes at 40%. This was announced in the 2024 Autumn Budget and confirmed in the draft Finance Bill 2025-26. The existing exemption for benefits passing to a surviving spouse or civil partner is maintained. This change makes Bahamas residency planning even more critical for British investors with significant pension wealth, as relocating before pension drawdown can form part of a comprehensive IHT mitigation strategy.

APR/BPR Reforms (from 6 April 2026)

Agricultural Property Relief (APR) and Business Property Relief (BPR) are being reformed from 6 April 2026. Combined relief at 100% will be limited to the first GBP 1 million of qualifying assets; 50% relief applies above this threshold. For British investors with agricultural or business interests, this further increases the attractiveness of Bahamas residency as part of succession planning.

Properties That Qualify for British Investor EPR

Any residential real estate in The Bahamas valued at $1,000,000 or more qualifies for the Economic Permanent Residency programme. Qualifying property types include luxury condominiums, single-family homes in gated communities, beachfront villas, and vacant land purchased with demonstrated development intent. The investment can be a single property or multiple properties whose combined purchase prices meet the $1,000,000 threshold. Properties must be purchased in the applicant's personal name or through a Bahamas-registered company.

Glenn Ferguson · BREA #1247 · Bahamas MLS · 24+ Years

Total Cost of Purchase for British Buyers

Budget 12.5%-14.5% of purchase price for total acquisition costs including EPR. All amounts in Bahamian Dollars, pegged 1:1 to USD. Wire transfers from UK banks (HSBC, Barclays, NatWest, Lloyds, Coutts, C. Hoare & Co.) are processed in USD.

Mortgages for British Buyers

Bahamas banks including RBC Bahamas and CIBC FirstCaribbean offer mortgages to non-residents. Expect 30-50% down payment and 6-8% interest rates. Many British buyers pay cash or leverage UK equity. All transactions denominated in BSD (pegged 1:1 to USD), so no foreign exchange risk on the Bahamas side — though Sterling/USD exposure applies on transfers from the UK.

Banking in The Bahamas

British citizens can open accounts at major Bahamas banks: RBC, CIBC FirstCaribbean, Scotiabank, and Bank of The Bahamas. Required documentation: valid passport, proof of UK address, reference letter from your UK bank, and source of funds documentation. Anti-money laundering compliance (KYC/AML) under the Financial Transactions Reporting Act applies. Glenn introduces clients to established banking contacts to streamline the process.

Citizenship Pathway for British Citizens

After holding Economic Permanent Residency for 10 years and residing in The Bahamas for at least 6 of those years, you may apply for Bahamian citizenship through naturalisation under the Bahamas Nationality Act. The decision is discretionary, granted by the Minister responsible for immigration. The Bahamas does not formally recognise dual citizenship under its constitutional framework. Under the British Nationality Act 1981, British citizens can renounce British citizenship, but this is irrevocable and has profound implications for right of abode, NHS access, state pension, and the right to live and work in the UK. Most British investors maintain EPR status indefinitely rather than pursuing naturalisation, preserving their British passport alongside Bahamas residency rights.

UK state pension abroad: The UK state pension is payable in The Bahamas, but is frozen at the rate when you leave the UK (no annual uprating) as The Bahamas is not covered by a reciprocal social security agreement. Private and occupational pensions are generally payable worldwide without restriction.

How British Investors Obtain Bahamas Residency

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Glenn Ferguson

Licensed Bahamas real estate agent and residency consultant with over 24 years of experience guiding international buyers through property purchase and Economic Permanent Residency applications. Specialist in British, Canadian, Indian, and American investor transactions. Glenn has facilitated hundreds of property purchases across Nassau, Paradise Island, and the Out Islands.

BREA #1247 · Bahamas MLS · WPIC-Certified Wedding Planner · Licensed Marriage Officer

BREA #1247 · 24+ Years

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