CAYMAN ISLANDS Law and Practice Contributed by: Norman Klein and Adam Johnson, Appleby
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 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.
• 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. Subject to limited exceptions, real estate used for paid tourist accommodation attracts tax at a rate of 13% of the amount charged to each tourist. There are no other domestic taxes or munici - pal rates currently payable on the occupation, acquisition, ownership or disposal of Cayman Islands real property or income deriving there - from.
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 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:
272 CHAMBERS.COM
Powered by FlippingBook