Legal, Tax and Financing Basics for Buying in Grenada

Buying in Grenada follows a familiar OECS sequence, and for once the key tax figures can be read from the government's own pages instead of agency summaries.

The legal process

A buyer needs a Grenadian attorney, who runs judgment and title searches, deals with the Deeds and Land Registry and arranges the alien landholding application for non-nationals. An offer and acceptance letter leads to a sale agreement and a 10% deposit held in escrow by the seller's attorney, refundable only if the licence is refused or title cannot be proven. The licence application needs a police record, two character references and a banker's reference, and typically takes three to six months. The fee is 10% of the price, covered in the relocation article earlier in this series, and some advisers say purchases made to obtain citizenship by investment do not need one, which a CBI agent should confirm.

Title needs care. A local guide notes that the Land Registry records titles but does not necessarily include every parcel, especially in remote areas, and that boundary markers can be unclear. A land surveyor, quoted at about EC$1,000 for a parcel under an acre, is a sensible check. Grenada has no multiple listing service.

Property transfer tax

The seller pays Property Transfer Tax, and the Inland Revenue Division's own FAQ confirms the rates: 5% if a citizen sells and 15% if a foreigner sells. The Ministry of Finance adds that tax is payable only on the value above EC$20,000, unless the transfer is a gift. For a buyer, this matters at resale, and it is worth asking sellers whether they have allowed for it when they set a price.

Purchase costs

The buyer pays stamp duty of about 1% of the price. A Grenadian law firm gives the formula as the price divided by 150 and multiplied by 1.5. A few guides quote 5%, which seems to confuse stamp duty with the transfer tax. Legal fees are typically about 2% plus 15% VAT, though one guide says 1.5% to 2%. The seller usually pays a commission of about 5% plus VAT.

Annual property tax

The Inland Revenue Division describes an ad valorem tax on market value, charged separately on land and buildings. Its current page lists residential rates of 0.2% for land and 0.3% for buildings, with EC$100,000 deducted from the building value of one owner-occupied property. The tax is due by 30 June, with a 5% discount for paying half by 31 March. The Property Tax Act's own table, as copied in an FAO legal database, shows 0.1% and 0.15%, and agencies quote either, so confirm the rate for a specific property with the Division.

Other taxes worth knowing

VAT is 15%, charged on legal fees, and the Division's VAT page refers to a 10% rate for tourism and accommodation services. The Division also describes a 15% withholding tax on certain payments to non-residents, and lists rent among the payments to which withholding applies. It does not say how that applies to a non-resident landlord, so it does not settle the question raised in the rental article earlier in this series.

Financing

Resident buyers can borrow locally, and non-residents should treat financing as limited and plan on cash. A developer's guide also says that where a mortgage is used the lender may need its own landholding licence, creating a second fee. That is unconfirmed, so ask an attorney whether it applies before relying on a mortgage.