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Doing Real Estate in Trinidad & Tobago
Doing Real Estate in Trinidad & Tobago
In Trinidad, the Foreign Investment Act, 1990 relaxed the restrictions on the foreign
ownership of real estate by foreign investors and improved the conditions for investment.
However, in Tobago, the Foreign Investment (Tobago Land Acquisition) Order, 2007
places some new restrictions on the foreign ownership of real estate.
In this Chapter, Tiffanny Castillo, Senior Associate in the Property & Estates Group
gives an overview of the following:
• The provisions in the legislation which permits a foreign investor to acquire land
for residential and commercial purposes in Trinidad;
• The provisions in the legislation which permits a foreign investor to acquire land
for residential and commercial purposes in Tobago;
• The two land title systems governing the ownership of land in Trinidad &
Tobago;
• The new system of land title which the Government proposes to bring into force
and the process by which land is transferred under this new system;
• Transfer taxes which vary depending on the nature of the transfer and the
purchase consideration;
The Foreign Investment Act 1990 (Chapter 70:07) is available for download at the
website of the Ministry of Legal Affairs at http://www.legalaffairs.gov.tt/ The purchase
price for the acquisition by the foreign investor must be paid in an internationally traded
currency through a bank or other entity authorized by law as a dealer in that currency.
One exception is in the case of a company incorporated in Trinidad and Tobago where
such consideration is financed out of capital reserves or retained earnings.
Additionally, the foreigner must, through his Attorney/Agent, deliver to the Minister of
Finance, a Notice specifying inter alia:
· his name;
· address;
· nationality and any former nationality;
· purpose for which the property is acquired;
· name and address of Vendor;
· the date and registration particulars of the deed and/or instrument by which he
became the owner of the property; and
· evidence of his payment in foreign currency.
It is also noted that the Minister of Finance may by Order prescribe areas in Trinidad in
which a foreign investor may not acquire land without obtaining a licence: section 6(2) of
the Foreign Investment Act, 1990. However, no areas in Trinidad have yet been
identified.
Foreigners may exercise the option to lease property or buy freehold title.
Under the Foreign Investment Act, 1990 (section 8) land may be acquired by a foreign
investor in Trinidad without a licence:
· on an annual tenancy or for any less interest for the purposes of his residence, trade or
business but not exceeding five (5) acres of land in all;
· under an intestacy, or as a beneficiary or as an executor under a will, for a period of one
(1) year from the date of the death of the testator or intestate, or for such extended time as
the President may grant;
· in pursuance of his rights to foreclose or enter into possession as a mortgagee for a
period of one (1) year from the acquisition of such land or for such extended time as the
President may grant;
· as a judgment creditor for a period of one (1) year from the date of his acquisition of the
land or for such extended time as the President may grant; and
· jointly with his spouse, where that spouse is a citizen of a Caricom member country who
is resident in Trinidad and Tobago within the meaning of section 5 of the Immigration
Act, Chapter 18:01.
Mortgages are given primarily upon satisfactory evidence as to the value of the property
and the fact that the title to the property is free from all encumbrances.
If a foreign investor wishes to purchase land in excess of the stipulated acreages, he must
apply for a licence from the President of the country in order to do so.
This application must indicate inter alia the proposed land use and must comply with the
controls and restrictions of the relevant planning and environmental authorities. The
application form for a Licence is available for download from the website of the Ministry
of Finance at http://www.finance.gov.tt - “Application Form to Hold Interest in Property
under the Foreign Investment Act, 1990”.
Property Taxes
The Government proposes to bring legislation to Parliament in 2009 to give effect to the
new Property Tax system. This legislation proposes to radically reform the current
property tax regime. The new system is expected to be implemented on January 1, 2010.
Further, it is proposed that the date after which penalties are applied for the non-payment
of taxes will be extended from 30 June to 30 September, the last day of the fiscal year.
Under this system, the Valuation Division of the Ministry of Finance will assess
properties based on the rental value appraisal method.
A new four-tiered regime will be implemented as follows:
Type of Property Rate Formula for Calculation of Property Tax
Agricultural 1% 1% of Annual Taxable Value (ATV)
ATV = 2% of the capital value
(land and farm building)
Residential 3% 3% of ATV
ATV = 90% of the annual rental value
Commercial 5% 5% of ATV
ATV = 5 % of capital value
Industrial 6% 6% of the ATV
ATV = 6% of the current market value or
6% of the installed cost of
specialized buildings, plant & machinery
ATV = 5% of the capital value of vacant
land
Examples of how to calculate the property tax may be found in a Publication called
“FAQ Brochure on Property Tax” dated October 20, 2009 on the website of the Ministry
of Finance at http://www.finance.gov.tt/index.php .
It is proposed that the new system will streamline the:
· assessment; and
· management and collection of property taxes
through the Valuation Division, which will assess properties in accordance with
international standards and a single collection agency, the Board of Inland Revenue. The
Government emphasises in the Budget 2009/2010 that the new system will facilitate
easier collection of taxes by increasing the number of payment centres, as well as
allowing for greater access by the taxpayer to his property and tax information via the
Internet.