Thursday, October 13, 2011

Tax Advantages of Owning Property in Belize


Those who purchase property abroad are often very successful financially. It stands to reason they they closely watch their dollars and sense and take reasonable steps to make sure that when it comes to paying taxes they pay the least amount required by law.
We all know that a good portion of our income goes to paying taxes of some sort or another. Many are unavoidable. But others aren't, especially in Belize.
As an example, there are NO capital gains taxes in Belize. So if you buy a property for $100,000 and you sell it for $200,000 and make $100,000 on the deal you don't owe the government of Belize one dime.
Property Taxes are also very low in Belize. For instance, a 2 bedroom oceanfront condo in Miami Beach that costs around $400,000 would be taxed around $5,000 U.S. per year. In comparison a 2 bedroom ocean front condo on Ambergris Caye that costs $400,000 will only run you $275 U.S. per year! You can see immediately how the cost of ownership would be much much less on a property here then in the U.S.
Rental Income is also taxed at a very low rate. Let's say you rent out your home or condo when you are not here to make some extra income. In the U.S. or Canada the tax on such income can be viewed as personal income and taxed accordingly from 25-35%. Here in Belize the tax rate is only 1.75%. So if you rent out your home or condo for $200 a night then your tax on that income is only $3.00
There are other tax advantages to consider. Buying and selling property using IBC's (International Business Companies) is a way to legally elliminate or postpone the paying of taxes that may be required by your home country. For more information on how to set this up please email me or register to view one of our Investing in Belize Webinars which breaks down the details of this type of ownership structure.

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