Is the Legal System the same in Barbados as in the United Kingdom?
Yes and No.
Barbados in an independent Commonwealth nation whose legal system is based historically on the English system of common law. Post independence, the laws have been crafted to suit the social, economic and political objectives of a post independent nation.
In particular, the system of transfer of title is substantially similar to that of the UK system of unregistered conveyancing. It is to be noted that registered conveyancing also exists in some areas.
Do I need to engage an Attorney-at-Law in order to purchase property in Barbados?
An individual must retain an Attorney-at-Law in order to sell or purchase any real property in Barbados. The Attorney-at-law must be duly licensed to practise Barbados law.
Are legal fees and expenses of purchasing property in Barbados more than in the United Kingdom?
It depends on the transaction value.
Legal fees and taxes are calculated based on a scale of fees set by statute. The rates vary and typically are smaller as transaction sums increase.
Most conveyancing transactions are based on the unregistered system of conveyancing. Consequently, when ownership changes from one party to another, the original title deeds must be transferred from Vendor to Purchaser.
In some areas, the registered system of conveyancing applies. In that scenario, the state guarantees the quality of title and no title deeds are transferred. Your attorney-at-law will determine which system applies and act accordingly.
Stamp duty is a Vendor's expense only. It is calculated at a rate of 2.5% of the transaction sum or the Land Tax Value, whichever is greater. For real property, there is an initial rebate of U$ 75K.
Costs and Timings
Legal fees are based on a scale set by the Barbados Bar Association (BBA). It ranges between 2.5% to 1% and is calculated on predetermined valuation bands. In addition, VAT at 17.5% is levied on legal fees.
Conveyancing transactions are typically contracted for a ninety (90) day period. This timeframe can be shortened or lengthened at the discretion of Purchaser counsel. The Purchaser counsel must be satisfied that his professional responsibilities are fully discharged to the client before a closing date is proposed.
Some Barbados financial institutions offer mortgage facilities to non-resident purchasers. The equity and injection rates tend to be higher due to a perceived higher risk profile. Alternatively, many non-resident purchasers secure equity from their primary homes in order to finance their foreign property purchase.
Who can own property?
Real property can be owned by individuals over the age of majority, a company or a trust. Property cannot be owned by minors except through their legal guardian who must be at least 18 years old.
Apart from standard utility bills (electricity, water, natural gas), homeowners must pay an annual land tax. This is based on the value of the property and is calculated on a regressive scale. There is no council tax nor local government tax.
For ease of computation, the U$ currency was used. However, all transaction values are documented in BD$. The BD$ is pegged to the U$ at a rate of approximately BD$1.989 = U$1.00.
Notice: Please be advised that this information is valid as at March 18, 2019. It is provided for general guidance only. It does not constitute legal advice. Specific legal advice should be sought based on your specific circumstances.