CAYMAN ISLANDS Law and Practice Contributed by: Norman Klein and Adam Johnson, Appleby
(a) if the term exceeds 30 years, 7.5% of the full market value of the leasehold interest in the real property; or (b) if the term is 30 years or less: (i) where any premium or other valuable consideration other than or in addi - tion to rent is provided, 7.5% of the amount of the premium; and (ii) where the consideration or any part of the consideration is rent: (i) 5% of the aggregate rent if the term is less than one year; (ii) 5% of the average annual rent or of market rent, which - ever is higher, if the term is one year or more but does not exceed five
at the discretion of the Minister of Finance) on debentures and legal or equitable mortgages or charges of immovable or movable property within the Cayman Islands. The following applies for a debenture or a legal or equitable mortgage or a charge of immovable property within the Cayman Islands: • where the sum secured does not exceed KYD300,000, duty is 1% of the sum secured; and • where the sum secured is more than KYD300,000 (whether initially or after a further advance), duty is 1.5% of the sum secured. In the case of a legal or equitable mortgage or a charge of movable property within the Cay - man Islands, duty is 1.5% of the sum secured (subject to a maximum charge of KYD500 where the security instrument is granted by a Cayman Islands exempted company, a Cayman Islands ordinary non-resident company, a Cayman Islands exempted trust or a body corporate incorporated outside of the Cayman Islands, or where the security is over shares in a Cayman Islands exempted company or a Cayman Islands ordinary non-resident company). Finally, policies of insurance for property within the Cayman Islands attract ad valorem stamp duty of 2% of the cost of the new or renewed property insurance premiums, which is usually added to insurance premiums. Most other related instruments and documents are subject to a fixed rate of stamp duty in com - paratively nominal amounts. Registrable instru - ments are also subject to relatively immaterial registration fees.
years; (iii) 10% of the average annual rent or of market rent, whichever is higher, if the term exceeds five years but does not exceed ten years; or (iv) 20% of the average annual rent or of market rent, whichever is higher, if the term exceeds ten years.
Subject to limited exceptions, ad valorem share transfer tax is payable on the transfer or issue of equity capital in a land-holding corporation, at the rate of 7.5% of the proportionate value of the entire land holding. A land-holding corpora - tion includes a partnership, foreign corporation, chartered corporation, mutual fund or incorpo - rated company (but not a corporation sole or charitable corporation) that holds any legal or beneficial interest (excluding interests created pursuant to bona fide security instruments) in landed property in the Cayman Islands (or inter - est in another land-holding corporation). Landed property includes freehold interests in Cayman Islands real property and any leasehold interest where the original term exceeded 30 years. In addition, ad valorem stamp duty is payable (subject to certain exceptions that are again
181 CHAMBERS.COM
Powered by FlippingBook