THE BAHAMAS COMPANY FORMATION
The Bahamas are not only a haven for tourists but also for tax payers, both foreign and local. The country has a number of institutions available that are perfect for offshore investments and that make sure investor’s pay the least amount of tax possible. The nation is home to many wealthy entrepreneurs who choose to invest there to avoid huge taxation in their own countries.
In the Bahamas, you do not have to pay personal income tax but individuals are required to pay some other taxes. All employees, self-employed persons, as well as non-residents, have to pay national tax. The contributions benefit the system of the Bahamas and residents will be able to claim from this fund. Their earnings will experience a 3.4% deduction and the employer tops it up to 5.4%. Expats may be refunded for their contributions when returning to their own country, but this depends on the length of time they have lived in the Bahamas.
Stamp duty may need to be paid on real estate purchases or when a large amount of money is sent abroad. Stamp duty may be anywhere from 2% to 8% and they are usually split up between the seller and the buyer. Real estate tax is applicable on other types of categories and includes land that has been developed on the New Providence Island and other islands and also on the undeveloped land in the procession of expats in New Providence Island.
Owners who live on their properties pay no tax on properties under $250,000. Above this amount to $500K properties are taxed at 0.75%. Properties above this amount are charged at 1%. Where owners do not live in their properties, they are taxed differently. Properties under $500K are taxed at 1% and over this amount are taxed at 2%.
Capital gains and inheritances are not taxed in the Bahamas, but imported goods have high duties. It can range from 25-65%. There are no taxes paid on wealth and no taxes payable on dividends and interests.
Due to different tax treaties signed by the government in the Bahamas, the entrepreneurs in the country pay reduced taxes when importing or exporting. Non-residents will only be responsible for taxes in their own country for the income made in the Bahamas. These treaties include several European countries.
Earning declaration activities do not have to be conducted in the islands and tax returns need not be completed. Also, there is zero annual tax per year. For more information about investments in the Bahamas, contact us today and we will be able to assist you.