5 Things You Should Know Before Purchasing Real Estate in Turks and Caicos
You need to be fully informed when buying real estate in the Turks and Caicos Islands.
As a wealth-friendly and tax-neutral territory, the Turks and Caicos Islands have much to offer to investment property buyers from all over the world. Here are five things to bear in mind if you are looking at Turks and Caicos homes for sale:
Property Taxes and Duties: There is no property tax in the Turks and Caicos Islands. Nor is there any Income Tax, Capital Gains Tax, Inheritance Tax, or Corporation Tax. The government earns its revenue through stamp duties and fees, including hefty duties (up to 37.5%) on most imported items. It also charges stamp duty on Turks and Caicos Real Estate’s sale over the value of $25,000. On Providenciales, this ranges from 6.5% to 10%, depending on the property’s value. On Grand Turk, South Caicos, Middle Caicos, and Salt Cay, the tax is between 5% and 6.5%. The seller pays the real estate agent fees, between 6% and 10%.
Foreign Ownership: There are no restrictions on foreign ownership of the real estate in the Turks and Caicos Islands. Suppose your purchase is part of a strategy to live, work, or own a business in the islands. In that case, you will need to look carefully at the other mandatory requirements necessary for the foreign property owners to gain residency. These will help you to overcome restrictions on employment and business ownership.
Coastal Issues and Land Shortages: Spectacular beachside locations and easy access to the water come with their problems. The many sand bars, coves, and channels that make the Turks and Caicos Islands so attractive also pose problems for those who don’t take the always-shifting coastline into account when looking to buy or build TCI real estate. Maps and aerial photographs might show large expanses of green or dry land, but much of it is taken up by mangroves, wetlands, and regularly inundated areas due to storms or high tides. It’s deceiving, as there’s not as much usable land in Turks and Caicos as there appears to be. The beachside properties may be more vulnerable than expected.
To Buy or to Build? Undecided about buying an existing property or building a new one? Constructing new allows you to set the standard of build and finish that you require. But remember those 37.5% duties on imported materials? They can take new build construction costs to an eye-watering level. If you’re looking at existing Turks and Caicos properties for sale, you will need to remember that stamp duty is paid as a percentage of the total value of a property, including all structures within its boundaries. You want to be sure that all those luxurious extras lifting the property’s price are extras that you really want; otherwise, you’re paying for nothing.
Solar Energy: Electricity costs in the Turks and Caicos, where power is generated almost exclusively via diesel generator, are the world’s highest. With increasing numbers of private installations throughout the country, Solar power is growing in popularity. Solar accounts for less than 1% of total power consumption. Fortis, the local utility, allows customers to purchase their own equipment to connect up to 10 kW of capacity to the grid, selling it back to the utility. Homeowners preferring to go off-grid can install their personal solar array, inverters, and storage/battery system isolated from the public electric grid. To incentivize take-up, a 30% import duty has been removed on imported solar panels and related equipment.
