British Virgin Is.: Overview

RENTAL YIELDS

Last Updated: Feb 15, 2008

BVI is very expensive

Properties in BVI are among the most expensive in the Caribbean. Yet the BVI has lots of land, populated at a low density. The average price of a 3BR house and lot along the coast of Tortola and Virgin Goda is around US$1.2 million while a 5BR house costs around US$1.9 million.

In the classy island of Virgin Gorda, villas sell for US$3 million and up. "The idea is that Virgin Goda will be kept for the high end," says Smith. "The people who buy here would be unlikely to buuy in Tortola."

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TAXES AND COSTS

Last Updated: Jul 11, 2007

British Virgin Islands levies property taxes only

Effective Tax Rate on Rental Income
Monthly Income	US$1,500	US$6,000	US$12,000
Tax Rate	7%	7%	7%
Click here to see a worked example
Source: Disclaimer

Property Tax: Land tax is based on the acreage of the property; it is imposed at US$150 for the first acre and additional US$50 for each extra acre thereafter. House tax is imposed at a flat rate of 1.5% of the property’s annual rental value.

Hotel Accommodation Tax: Gross rents received from guests staying for short periods of time in the islands (less than six months) are subject to 7% hotel accommodation tax. Long-term rentals and leases to British Virgin Islands residents are not liable for this tax.

There are no income, capital gains and inheritance taxes in the British Virgin Islands. The condition is the same for residents and non-residents.

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BUYING GUIDE

Last Updated: Mar 05, 2008

Buying costs are high in the British Virgin Islands

Roundtrip transaction costs range from 11% to 22% of the property value. For non-belongers, the stamp duty of 12% of the property's value accounts for the greater part of the costs. Legal fees are imposed on the property value, 2% for the first US$100,000 and 1% on the remaining amount. Real estate agent's commission is negotiable, typically from 6% to 8%.

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LANDLORD AND TENANT

Last Updated: Jul 20, 2008

British Virgin Islands tenancy laws

Tenancies in the British Virgin Islands are usually short-term tenancies. It takes an average of 58 days to evict a tenant.

ECONOMIC GROWTH

BVI: Beautiful, Vibrant Islands

First settled by the Dutch in 1648, the BVI (pop. 22,000) were annexed in 1672 by the English. The climate is subtropical and humid, but temperatures are moderated by trade winds. The coral islands are relatively flat; while volcanic islands are steep and hilly.

BVI (pop. 22,000) belongers have automatic UK citizenship. But this right is not reciprocal, and UK citizens wishing to become BVI belongers must endure the same delays and uncertainties as other outsiders.

The economy of the BVI is closely tied to that of the US Virgin Islands and it is anchored on tourism, international business, and offshore financial services. Its economy experienced strong economic growth from 2000 to 2004, with an average annual growth rate of 5.7%.

Tourism plays a vital role in the economy. People visiting the British Virgin Islands increased an average of 10% per year from 2000 to 2005, whereas stay-over visitors to the islands increased an average of 3% per year over the same period. Total number of visitors to the islands was 820,800 in 2005, of which 337,150 were stay-over visitors.

The islands attract the yachting crew drawn by steady trade winds, well-protected anchorages and a year-round balmy climate. Company incorporation fees also generate substantial revenues. Roughly 400,000 companies were on the offshore registry by yearend 2000. Despite BVI's status as a British dependent territory and many British influences, the prevailing cultural influences are more American than British.

Ironically, the economy of the BVI was primarily agricultural till the early 1980s. It was the offshore industry which pushed the BVI forwards.

The BVI comprises 16 inhabited and more than 34 uninhabited islands. The largest islands of the group are Tortola, Virgin Gorda, Anegada, and Jost Van Dyke. Road Town, the capital and largest town, is situated on Tortola.