Bahamas - Frequently Asked Questions Regarding Stamp Duty Exemption

Below are some common questions relating to stamp duty exemption in The Bahamas and the answers to those questions.

So, what is the definition of a first-time home buyer?

It is not exactly snappy: "A person who has not acquired a freehold or leasehold interest in a dwelling house in the Bahamas or anywhere in the world." In other words, you do not qualify for the stamp duty exemption if you have owned a dwelling house in The Bahamas or anywhere else in the world. The Stamp Act adds the buyer(s) "must intend to occupy the property for an aggregate period of 9 months". So the exemption does not apply to second homes or buy-to-lease properties.

I'm buying jointly with my partner. What's the deal?

All the buyers, when there are more than one, must be first-time home buyers. So you do not qualify for the stamp duty exemption if one of you has previously owned a home.

Many years ago, I bought a house jointly with my wife. We divorced a long time ago and I'm now with a new partner, who has never owned before. Can I/we be treated as a first-time buyer?

As you have been involved in buying a home in the past, you will not be eligible for the stamp duty exemption if you decide to buy jointly. But if your new partner meets the criteria, she will be eligible if she buys the property in her name. Some couples will not want to go down that road for their own reasons.

What about someone previously in shared ownership: are they disqualified, even though they never bought outright?

Yes, I'm afraid so.

I assume I'm excluded if my parents (who already own) buy a flat for me? (I've never owned a property)

Correct, this transaction would not be eligible for the stamp duty exemption.

Can I claim the relief if I'm buying on behalf of my parents?

No. The exemption is not available unless the first-time buyer(s) are buying, for themselves, a property they intend to use as their only or main residence."

Can I get exemption if I once inherited a property? After all, I didn't buy it.

No. In this case a person will be seen to previously have acquired a major interest in a residential property.  Upon a subsequent purchase you will not be deemed to be a first-time home buyer under the Stamp Act.

How will this regime be policed? What checks will be done?

Anyone buying a property has to submit their documents to the Public Treasury for stamping. The Treasury will then input all pertinent data relating to the transfer into its database, and that means that you will be on its system as having bought a property. The Treasury says if you have previously bought a property, your name will flash up on the system.

What happens then?

If you are found to have abused the system, in that you are not a genuine first-time buyer, you will be charged the stamp duty you have evaded, and you will be penalised with a fine of $5,000.

How will The Public Treasury catch up with people who have owned a property overseas?

The Treasury boasts of having a vast network of "tax information exchange agreements" with other countries, which enable it to find out information about people who are new to The Bahamas.

What if I change my name by deed poll? Surely I can't be found?

That's an interesting one.  However, if the Treasury does catch you out, you will face the penalties outlined above.

Is there an age limit?

No. First-time home buyers can be any age to benefit.

Can only Bahamian citizens apply for stamp duty exemption?

No, a non-Bahamian can apply for stamp duty exemption as long as it can be shown that the buyer has never owned a home in The Bahamas or outside The Bahamas.

I bought my home earlier this year and missed out on this exemption. Can I retrospectively make a claim?

No. "Transactions with an effective date before the coming into force of the stamp duty exemption provisions in the Stamp Act do not qualify."

This post is intended for your information only and is not to be construed in any way as legal advice.  If you require specific advice or you are a first-time  home buyer looking to purchase a home and require the assistance of a Bahamian real estate lawyer, you can contact an experienced Bahamian property attorney by clicking here.