What are closing costs for buyers in The Bahamas?

Closing costs are real—and the best buyers plan for them upfront. I don’t like surprises at the closing table. The way you avoid them is simple: verify the property, verify the building (for condos), then get a deal-specific estimate through the attorney process early.

Are closing costs different for Bahamians vs non-Bahamians?

Here’s my straight answer: there is no separate “Bahamian vs non-Bahamian tax table” for buyer closing costs. Most buyers budget the same categories—government transfer tax, legal fees + VAT, inspections, insurance, and condo prorations. What changes is (a) eligibility-based exemptions Bahamians may qualify for, and (b) compliance handling that can apply to some non-Bahamian purchases depending on property type and intended use.

Comparison table: Bahamian vs non-Bahamian buyer costs (what’s actually different?)

Cost / Requirement	Applies to Bahamian Buyers	Applies to Non-Bahamian Buyers
Conveyance VAT (transfer tax) on the deed	Yes (contract determines split)	Yes (contract determines split)
First-home VAT duty relief (eligibility-based)	May apply (Bahamian citizen + first-time dwelling home + value caps + application/approval)	No
Legal fees + VAT on legal services	Yes	Yes
Inspections	Common / recommended	Common / recommended
Insurance	Yes (location/exposure dependent)	Yes (location/exposure dependent)
Condo prorations + condo docs	Yes (if condo)	Yes (if condo)
Mortgage Duty (if financing)	Yes (if financing)	Yes (if financing)
Additional compliance handling (depends on property type/use)	Usually not a special step beyond standard conveyance	Sometimes required (deal-specific; attorney confirms)

The “big” government cost: conveyance VAT (transfer tax)

The Bahamas charges VAT on the conveyance—the tax paid when the deed is stamped and ownership officially transfers. In many transactions, market practice is to share this 50/50 between buyer and seller unless your contract says otherwise.

Conveyance VAT rates (typical schedule for individuals)

Property Value Band	Typical Rate
Up to $100,000	2.5%
$100,001–$300,000	4%
$300,001–$500,000	6%
$500,001–$700,000	8%
$700,001–$1,000,000	9%
Over $1,000,000	10%

Note: Transfers to a company/other entity are generally 10%. Your attorney will confirm the applicable rate and structure for your specific transaction.

Bahamian buyer exemptions (what Bahamians may qualify for)

1) First Home Owners VAT duty relief (closing-stage relief)

Eligible first-time Bahamian homeowners may apply for VAT duty exemptions on their conveyance (and mortgage instrument if applicable) for the acquisition of a first-time dwelling home. In practice, this can be a meaningful reduction in what you pay at closing—if you qualify.

• Who it’s for: Bahamian citizens purchasing a first-time dwelling home (age/eligibility rules apply).
• What it affects: Government VAT duty on the conveyance and, where applicable, the mortgage instrument.
• What decides it: Current value caps, property type/use (must be your dwelling home), documentation, and approval.

2) Owner-occupied Real Property Tax relief (ongoing annual holding cost relief)

If the property is owner-occupied and beneficially owned in the way required by current rules, Bahamian citizens can qualify for owner-occupied real property tax relief. This does not replace closing costs, but it can reduce your annual carrying cost after purchase.

• What it affects: Annual real property tax (holding cost), not your inspection/legal/insurance costs.
• What decides it: Owner-occupancy, use as a dwelling, documentation, and the current tax framework/value treatment.

For the most current eligibility rules and value caps, your attorney should verify the applicable exemptions with the Department of Inland Revenue for your specific transaction.

Full buyer cost schedule (Bahamian & non-Bahamian purchases)

When buyers ask me for the full cost schedule, I explain it this way: there is no separate “Bahamian vs non-Bahamian tax table” — but there is a clear, predictable list of costs every buyer should plan for, plus exemptions Bahamians may qualify for, and a few compliance steps that can apply to non-Bahamians depending on the purchase.

1) Government costs (apply to all buyers)

• Conveyance VAT (transfer tax) on the deed (split is negotiable; contract controls).
• Mortgage Duty (only if financing): typically 1% of the mortgage amount.
• VAT on professional services: standard 10% VAT on legal fees and most professional services.

2) Professional & transaction costs (real-world items)

• Attorney / conveyance fees (plus VAT).
• Inspections (home, systems, specialty if needed).
• Survey / boundary confirmation (when required).
• Insurance (varies by location, structure, and exposure).
• Bank fees (if financing).

3) Condo-specific buyer costs (very common)

• HOA / maintenance fee prorations.
• Condo document & admin fees.
• Special assessment exposure (risk item, not a flat fee).
• Move-in fees or reserve contributions (building-specific).

4) Bahamian eligibility-based relief (if you qualify)

• First Home Owners VAT duty relief (closing-stage relief; requires qualification + application/approval).
• Owner-occupied real property tax relief (ongoing annual holding cost relief; owner-occupancy requirements apply).

5) Non-Bahamian buyer considerations (not extra taxes, but extra steps)

• Possible compliance handling depending on property type and intended use (deal-specific; attorney confirms).
• Additional legal handling to ensure compliance (your attorney confirms the specific path).
• Banking and funds transfer timing considerations (not a tax, but affects closing).

Condo buyers: what I make you confirm

• HOA/maintenance fee (current, not outdated).
• Special assessment history or risk.
• Rental restrictions (Airbnb/short-term rules).
• What’s included: insurance coverage, amenities, reserves.

My bottom line

The buyers who close smoothly in The Bahamas are the ones who budget correctly from Day 1 and verify fees, rules, and documents early. If you want this done right, I match you with verified listings first, then we confirm the true monthly cost and the closing-cost picture before you move forward.

About Glenn Ferguson

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