Transfer tax and stamp duty are fees that are attached to your cost when you are involved in a Jamaican home for sale transaction, typically a percentage of the value of the land. Normally the value is in line with the sale price.
The transfer law establishes that the transfer tax is 7.5%. There is relief in the amount of $10,000.00 when the value of the land is $150,000.00 or less. The type of housing does not matter. It is generally a misconception that beachfront homes for sale in Jamaica attract a much higher transfer. This is simply not true. However, there are some exemptions to these property taxes in Jamaica.
exemptions
1. Transfers of ownership by the Jamaican government and local authorities.
2. Transfers to the government or local authorities of Jamaican land for purposes such as roads and other reservations in subdivisions.
3. Transfers as donations to authorized institutions of assets for their exclusive use for charitable purposes.
4. The main place of residence of the spouses (Joint Tenancy or Common Tenancy) In case of death only.
Stamp Duty: Payment of stamp duty is governed by the Stamp Duty Act. The stamp duty payable on land is approximately 5.5% of the total value of the land/house.
Certificate of Title:
Once a property is registered, it is identified by Volume and Page numbers in the Title Registry Book. The original Title is kept at the Title Office and notations are made on it whenever something affecting any interest in the land is brought to the attention of the Registrar of Titles. For example, a transmission, a mortgage, the death of a co-owner, easement concessions, etc. This is the standard for all houses for sale in Jamaica.
The owner of the land obtains the duplicate Certificate of Title from the Registry. A duplicate Certificate of Title must be submitted to the Registrar for approval of all transactions affecting the land.
Exercise of Alienation or Transfer of Houses in Jamaica for Sale
This normally begins between the seller (seller) and the buyer (buyer) or between any of the aforementioned parties and a Jamaican real estate broker or Jamaican real estate agent. The buyer or attorney must inspect the duplicate certificate of title. This is vital as some homes for sale in Jamaica come without sales agreements and therefore no transfer may have taken place. A title proves exactly who owns the land.
The usual form of Purchase and Sale Agreement establishes, among other things:
(1) Legal names, registered office and lucrative activity of the contracting parties.
(2) Complete description of the house in Jamaica for sale – including the actual size or dimensions, registered location, and identification folio and volume numbers of the Certificate of Title, in the case of buildings and land registered in Jamaica. In the case of land with Common Law Title, the size, description, boundaries and other relevant details.
(3) Purchase price – in words and figures to avoid errors and misunderstandings.
(4) Termination – The effective date on which the final payment of the transaction is expected to be collected and the complete sale to be completed, that is, the transfer is made, checks and titles are exchanged.
(5) transfer cost – unless otherwise agreed, this generally provides that each party must bear half the cost of stamp duty, registration fee and solicitors’ costs.
Jamaican Realtors Commission Payment: Payable upon completion of title transfer and closing of transaction.
Rates in the sale of land
1. Transfer tax: 7.5% of the market value (only for the supplier)
2. Stamp duty: approximately 5.5% of the market value
3. Registration fee: approximately 2% of market value (or $2.00 per 1,000)
4. Attorneys Fees – By Scale – Jamaica Bar Association (effective June 1, 1991)
5. Surveyor Identification Fees:
(i) Values up to $500,000.00 = $1,500.00, hereinafter, 0.1% up to 1 million, hereinafter, $1,000 per million. Plus $400.00 title and investigation fee/charge.
(ii) Property exceeding 1 acre or Irregular Boundaries will have a transit fee added. The fee depends on the length of the journey.
(iii) If the land is outside the corporate area $6.00 per mile.
6. Valuation Fees:
Kingston Jamaica Corporate Area
Corporate Area: Cost $3.00 per 1000 of the market value and $150.00 for travel and incidental expenses. Minimum rate of $1,000.00 plus trips and incidentals $1,150.00
Outside the Corporate Area – (Beyond 15 miles from Kingston Jamaica) 3.50 per 1,000 market value plus travel @ $3.50 per mile minimum rate of $1,500.00 plus travel.
7. Mortgage Costs: (Building societies)
(1) 1% application fee (save)
(2) 2% application fee (without Saver)
(3) Life Insurance – the amount varies according to age.
N.B. The Mandatory Company will no longer accept an assignment of Existing Policy.
(4) Mortgage compensation: 7% of the insured sum is applied when the mortgage exceeds the standard two-thirds: 90% of the mortgage.
(5) Mortgage stamp duty
(6) Mortgage Registration Fees
(7) Attorneys’ fees
(8) Valuation fee
(9) Identification of surveyors
(10) First month mortgage payment
Mortgages: – $1.00 per 200 x 25% or 0.65%
These describe all the costs associated with buying homes for sale in Jamaica. It is important that both the seller and the buyer understand the fees associated with this Jamaica real estate transaction.