"Providing independent legal advices to purchasers, vendors and developers for over thirty years"

CONVEYANCING

Real estate investment by foreign investors has increased dramatically in recent years with the growth of the tourist industry on Providenciales and the resulting awareness of what the islands have to offer. 

TCI's Registered Land system provides a simple and reliable land transfer process.  Nevertheless, in order to avoid the other potential difficulties which can arise, it is imperative that legal advice is sought "prior" to the signing of any agreement or payment of any deposit. The potential risks of signing any agreement, however informal, relating to real estate without first obtaining legal advice cannot be overstated.  Under TCI law, once parties have committed certain basic terms to writing, the agreement may be enforceable against them, despite the fact that there may be important provisions which remain to be finalized and notwithstanding the fact that other important arrangements have not been made.

Professional fees

With limited exceptions Dempsey & Company charges on a percentage basis for conveyancing work applying a sliding fee scale based upon the Bar Association Minimum Scale Fee schedule.  Work done in relation to leases is typically charged on a time spent basis.  We will be happy to provide a quote in relation to any conveyancing matter upon request. 

General Procedure

Typically, a real estate purchase will involve the signing of an initial sales agreement and payment by the buyer of an initial deposit, usually 10%, towards the purchase price.  The date for closing the transaction is usually fixed by agreement between the parties (typically 30 days) at which time the transfer document will be handed over to the buyer's attorney in exchange for the remainder of the purchase price.  The transfer document is lodged by the buyer's attorneys in the Land Registry and the Register for the property is then amended by the Registrar who deletes the name of the seller and inserts the buyer as the new owner of the property.

Condominiums

The condominium market is a comparatively new and expanding area of property law in TCI and as such, is worthy of specific comment.  It is Dempsey & Company's view that independent legal advice is as important when purchasing a condominium as it is when purchasing a house or undeveloped land.  Potential purchasers should give consideration to the obligations and duties owed by sales agents and managers of condominium developments and should take an independent view on legal representation. 

Generally condominium developments in the Turks and Caicos Islands have the same  basic characteristics as condominiums in the United States and elsewhere - e.g. the owner becomes a member of the general owner’s association, which is known as the Strata Corporation, of the development concerned. 

Each Strata Corporation will have registered bye-laws, which are its constitution and which determine how the development is run.  Usually the Strata Corporation is run by an executive committee of several owners elected by the general membership.  Ownership of a condominium generally involves periodic payment of Strata Corporation dues to cover maintenance of common areas, building insurance and other expenses.

Stamp Duty

Although there are no property taxes or other direct taxes in the Turks and Caicos Islands, stamp duty is payable on most real estate transactions.  Generally, stamp duty in respect of registerable transactions must be paid within 30 days of completion of the transaction.  In view of the substantial sums which may be involved, the attendant penalties for non-compliance with stamp duty regulations, and the very real possibility of paying more than is required by law taking professional advice in relation to stamp duty is recommended.

The main categories of stamp duty are as follows:

A graduated scale of stamp duty is payable upon the transfer of the property.  Where property valued in excess of US$75,000.00 is transferred stamp duty is chargeable at the rate of 7% on Providenciales and 3% for the less developed islands.  Transfers of lesser value incur a lesser rate duty.

Usually, the purchase price is the benchmark for calculating stamp duties however the Land Valuations Officer can (and occasionally does) carry out his own valuation as stamp duty is calculated on the value of the property.  Generally, the purchaser will be liable for the payment of stamp duties.  There is an equivalent duty payable upon the transfers of shares in corporations owning real estate in the Turks and Caicos Islands, where a change of beneficial ownership is involved.

Also noteworthy:

• Stamp duty of 1% of the sums secured by the mortgage is payable upon registration;
   

• Stamp duty is payable upon the registration of leases.  The stampable amount is dependant upon the length the lease and the average annual rental.

Should you require assistance with a property transaction please do not hesitate to contact us.

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