St Lucia Real Estate Laws
The property purchasing procedure in St. Lucia is similar to that in the UK, with the exception of the Alien’s Landholding Licence which all non-St. Lucian buyers must first acquire before they are able to hold and own real property in St. Lucia. Please note the following:
A local lawyer must register the licence.
It is a permanent licence, which does not require renewal.
The licence is granted for a specific property or plot of land and is not transferable.
There is a non-refundable licence application fee of US$560.00.
The licence issue fee is US$1,875.00 for properties measuring less than 1 acre and US$3,730.00 if over 1 acre.
There is a future tax liability of 10% of the cost of the property or plot of land, when eventually sold. Note that the payment of the 10% tax can be avoided by making the purchase through a company, which can be formed at the time of purchase. Company formation takes approximately 1 week and costs US$1,770.00.
If the alien’s landholding licence is required to buy land only, you will be required to construct a property within 2 years of purchase.
The application is vetted by the Physical Planning Office of the Ministry of Physical Development, Environment & Housing, before being sent to the Prime Minister’s Office for approval. After the application has been granted the draft licence is sent to the Office of the Attorney General for approval and then to the Land Registry for registration.
The list below indicates what will need to be submitted with the licence application form:
Completed application form.
Full details of the property or land to be purchased.
A value assessment of the property or land.
Statutory declaration prepared by attorney for the Purchaser.
Four passport size photographs.
Certification of character – report from your local police station showing no convictions.
Certified finger-prints – from a police station.
Treasury receipt for payment of the application fee (US$560.00).
Stamp duty on property is 2% of the purchase price which is payable to Inland Revenues upon registration of the Deed of Sale.
The normal deposit for purchase is 10% of the purchase price. To prevent a vendor taking property off the market for a sale which may not close, a forfeiture clause is introduced into all purchasing contracts as follows:
If the buyer withdraws prior to closing the deposit is forfeited.
If the vendor withdraws prior to closing then a sum equal to the deposit must be paid to the buyer. The buyer would receive the original deposit plus the 10% forfeited by the vendor.
If the buyer is unable to proceed due to the Alien’s Landholding Licence not being issued, then the 10% deposit is refunded. This only occurs where the buyer has criminal convictions and denial is a rare occurrence.
A local attorney is required to draft, execute and register the conveyance document (locally referred to as a Deed of Sale). The Bar Association Tariff quoted fees range from 3% to 5% of the purchase price when an alien’s licence is involved, however, most attorneys on the island are open to reducing such fees given the steady increase in property prices on the island which has taken place over the past ten years given St. Lucia’s growing reputation as one of the most desirable destinations in the Caribbean.
The start-up cost for property purchase is approximately 15% of the property price, made up of, 10% deposit + 2% stamp duty + 3% attorney fees.
When purchasing properties forming part of a new development, the developing company would put in place an escrow account for owners to make their deposits into, so that the money is totally safe. The development stage payments is typically as follows:
20% On completion of foundations
30% On completion of structure
20% On completion of roof and exterior
20% On completion of building
When selling property in St. Lucia, vendor’s tax needs to be paid at a flat rate of 10% for non-citizens. There are corporate options available however, to clients wishing to reduce their tax liability upon resale. This can be discussed directly with clients when they visit our office.
St. Lucian citizens pay vendor’s tax according to the following scale:
Nothing on the first EC$50,000.00
2.5% on the next EC$25,000.00
3.5% on the next EC$75,000.00
5% on the balance
You can avoid the Alien’s Landholding License by becoming a citizen of St. Lucia. If you are not resident in St. Lucia you can qualify for citizenship if you fit into one of the following categories:
You or your parents were born in St. Lucia.
You are married to a St. Lucian citizen.
If you don’t fit into one of the above categories, owing property on the Island is one of the main qualifications when applying for citizenship.
For further details on any of the above, please contact your appointed St. Lucian lawyer.
The Land and House Tax Act was amendment in Parliament on the 12th October, 2006 to be effective 1st April, 2007. Exemption from property tax is granted where an owner occupied residential property, the owner of which has attained the age of sixty years or more and who uses the residential property exclusively for providing accommodation for himself or herself and members of his or her family.