As tax season is upon us once again, many people in the United States find themselves at the computer exploring residential communities that offer tax advantaged living. Could there be a better solution for them now, and for the long-term? Where to go? What’s involved? Can they do it?
Following the 2018 new cap on deductions for taxes, including property taxes, there has been a mass exodus among high-tax states with buyers fleeing to garner the benefits of a less-taxing lifestyle, many of them going offshore, and down into the islands of the Caribbean where they can purchase a home while also receiving desirable tax benefits. We wanted to narrow the field for those looking for the best solution, so we are featuring three of our favorite finds throughout the Caribbean.
Tax Advantaged Living: Andaz Residences at Grace Bay | Turks & Caicos
Andaz Turks & Caicos Residences at Grace Bay is the first Andaz branded resort and residential property in the Caribbean. It provides a new level of oceanfront luxury spanning 5.5 acres along the island’s famed Grace Bay Beach. Designed by Rafael Amuchastegui of RAD Architecture Inc. and Modus Operandi A+D Inc., Andaz Turks & Caicos Residences at Grace Bay will be comprised of two beachfront buildings including a nearly 60 room full-service boutique hotel and a separate, branded residential component.
The residences will offer 74 homes for sale ranging from studios to four-bedroom units, with lockout capability to maximize rental flexibility, and a collection of penthouse lofts including some that are two-stories. Amenities shared by the hotel and residences will include a full-service spa, restaurants, bars, pools, fitness studio, spa and more!
Residential owners have the opportunity to put their homes into the hotel rental pool, which is managed by Hyatt. By owning property in a branded resort, like Andaz, owners will benefit from Hyatt’s reservation system and their ability to deliver nightly rental guests. Ground breaking will take place this year, and the project will open in the first quarter of 2023.
Tax advantages: The beautiful destination of Turks and Caicos is a combination of turquoise blue waters, an intimate collection of islands and lucrative tax benefits. A legal tax haven, Turks and Caicos is often seen as the best place in the Caribbean to invest your money due to the British Rule of Law, where the crown guarantees title to your property and the U.S. dollar is denominated. There is no income tax, capital gains tax, property tax, inheritance tax, or corporation tax in the Turks and Caicos Islands, and buyers purchasing a second-home there can qualify to obtain permanent residency status. Stamp duty is a one-time fee of 10% of the purchase price of a property. Once it is paid, there are no further taxes associated with ownership.
Tax Advantaged Living: The Strand | Providenciales, Turks and Caicos
Opening late this year, The Strand is a thoughtfully crafted private residential community in the heart of Cooper Jack Bay, an undeveloped and unspoiled stretch of coastline on the protected south side of Providenciales. With a limited selection of 46 luxury beachfront villas, custom residences, and homesites, The Strand is intimate in nature while bringing the community together with a collection of shared amenities for sport and socializing.
Owners and guests have access to the Beach and Tennis Club, a concept which does not currently exist in Turks and Caicos; 1,400 feet of canal and marina frontage with community yacht slips; a water’s edge restaurant and bar with an outdoor beachfront patio and lush open-air garden; and a resort-style swimming pool designed as a lagoon surrounded by native limestone and towering palms. Residences start at $2.2M, each perched above the ocean’s edge with access to the bay below and ocean-facing bedrooms and uninterrupted views.
Tax advantages: The beautiful destination of Turks and Caicos is a combination of turquoise blue waters, an intimate collection of islands and lucrative tax benefits. A legal tax haven, Turks and Caicos is often seen as the best place in the Caribbean to invest your money due to the British Rule of Law, where the crown guarantees title to your property and the U.S. dollar is denominated. There is no income tax, capital gains tax, property tax, inheritance tax, or corporation tax in the Turks and Caicos Islands, and buyers purchasing a second home there can qualify to obtain permanent residency status. Stamp duty is a one-time fee of 10% of the purchase price of a property. Once it is paid, there are no further taxes associated with ownership.
Tax Advantaged Living: Montage Cay | Abaco Islands, Bahamas
Montage Hotels & Resorts recently announced the brand’s first ever Caribbean private-island retreat, Montage Cay, a 53-acre private-island resort and residential community to debut in The Abacos Islands in the Bahamas in 2023. Poised to become one of the most exclusive ultra-luxury resort destinations in the Caribbean, Montage Cay is conveniently positioned less than one mile off the coast of Marsh Harbour. Remote yet easily accessible, residents and their guests will have access to extensive direct flights offered from major American and European markets to the Bahamas, as well as a modern FBO that welcomes private jets and charters.
The private-island resort will feature 50 all-suite accommodations and a limited collection of Montage Residences built in harmony with the island’s seven white-sand beaches against a tranquil backdrop of the Sea of Abaco and the stunning surrounding cays. A 46-slip marina accommodating vessels up to 110 feet anchors the resort, allowing guests and residents of Montage Cay exceptional access to an array of world-class boating, fishing and water sports activities.
Tax advantages: The stunning beaches and turquoise ocean, a high standard of living with close proximity to the USA, and the exquisite locations of properties has attracted a very wide range of property investors to The Bahamas. The Bahamas has no income tax, capital gains taxes or inheritance taxes. Buyers investing over $750,000 USD in Bahamas real estate are eligible to apply for permanent residency. Homes and condos which are occupied by the owner have no property tax on the first $250,000; for the next $250,000 the rate is 0.75 percent, and the value over $500,000 is taxed at 1 percent with a $50k ceiling. A 7.5 percent VAT tax is charged on goods and services.
