Second Home Tax Benefits in Belize
Belize: Your Tax Haven for Privacy and Profits
Today, when more governments are snooping on citizens and more courts are seizing property, Belize stands out as one of a dwindling number of safe tax havens where you can still ensure privacy and protect your assets.
In the early 1990s, the government of Belize consulted with professionals in Guernsey and several other top safe havens before drafting legislation that would enable Belize to achieve similar status.
Legislation included the International Business Companies Act, the Trusts Act, and the Offshore Banking Act, all of which have moved Belize to the forefront of the international financial service jurisdictions. Moreover, to attract retirees from other countries, Belize also adopted a “qualified permanent residence law,” which allows retirees to enjoy a tax-free lifestyle.
Individuals and companies establishing themselves in Belize are finding a government committed to privacy and a no-tax system. These advantages, combined with an English-speaking population and laws similar to our own, make Belize one of the world’s top tax havens–a truly safe locale for your money.
Income Tax in Belize
Income tax is charged at a rate of 25%, and for residents of Belize, the first $10,000 of their annual income is exempt. Pension income is also exempt.
To qualify for residency, an individual must be present in Belize for 183 days or more during a calendar year. There’s no graduated scale of taxation like in the U.S. and many other countries. Property taxes depend entirely on the type of property and start at 1% of the assessed value. Belize currently has no capital gains tax.
Though Belizean tax law is far simpler than the U.S. tax code, always consult a knowledgeable attorney, especially if you spend more than 183 days in the country during a calendar year.
Even if you are not a QRP, the laws allow you to avoid income taxes altogether by transferring income and assets (though not real estate) into a Belizean International Business Corporation (IBC). Dividends to you from the IBC are not taxable.
Real Estate Tax in Belize
Currently, property transfer taxes are at 10%, and attorney fees usually equal 2%, including miscellaneous expenses. The buyer usually pays around 12.5% for closing costs, based on the total purchase price of the real estate . If you are a resident under the Qualified Retired Persons incentive program, the 5% on non-citizens is waived.
Property Taxes in Belize
Belize’s property taxes vary but are between 1% and 1.5% of the value of the undeveloped land. In Belize, property taxes outside cities are based on land value rather than the developed value of the property, to encourage development. Property taxes on homes and other developed land even in cities are low. For example, the property tax on a four-bedroom U.S.-style home would likely be in the range of $100 to $200. There is no capital gains tax in Belize.
*Prices as of 2013
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