Seychelles Property Investment Guide Hospitality Edition 2014
SEYCHELLES Property Tenure/Ownership Two types of tenure exist for ownership of immovable property in Seychelles: freehold title; and leasehold title. Under the Immovable Property (Transfer Restriction) Act, a non- Seychellois may not, without first obtaining the sanction from the relevant minister: purchase any immovable property or right to the property; lease any property or rights in the property; or enter into any agreement that includes an option to purchase or lease any such property or right. A non-seychellois is a person who is: not a Seychellois national or is a company; an overseas company; or a corporate body by whatever name called that is under non- Seychellois control. A company is deemed to be under non-seychellois control if: it is an overseas company; any of its directors are non-seychellois; more than one-third of the votes exercisable at meeting are vested in non-seychellois; more than one-third of the nominal amount of its issued shares are held by non-seychellois; the amount paid as dividends to non-seychellois members in a 12-month period exceeds one-third of the total amount paid as dividends by the company in the same period; more than one-third of the nominal value of debentures or charges of the company are held by non-seychellois; or annual interest on debentures or charges held by non-seychellois exceeds one third of the annual interest on all debentures or charges of the company that are outstanding. Foreign individuals and companies with any foreign participation are required to submit an application to the Ministry of Land Use for sanction to: purchase or hold an option to purchase an immovable property; or acquire or hold an option to acquire shares in a company that owns an immovable property. In considering an application, the Minister will have regard to: the character of the applicant (or directors, if a company); whether the declared purpose is consistent with the government s policy on land use and development in Seychelles; and whether the acquisition is in the interest of the country. The Minister may impose any conditions or restrictions on the grant of sanction. Any sanction granted is valid for one year from the date it is granted. If the property is later resold to a non-seychellois purchaser, a new sanction application is required. Major Property Legislation Civil Code of Seychelles 1975 Cap. 33 Condominium Property Act 1992 Cap. 41A Immovable Property (Judicial Sales) Act Cap. 94 Immovable Property (Transfer Restriction Act) Cap. 95 Land Registration Act 1967 Cap. 107 Land Settlement (Perpetual Leases of State Land) Act 1966 Cap. 108 Town and Country Planning Act Cap. 237 Operational Requirements for Foreign Corporations Under the Companies Ordinance 1972 ( CA 72 ), an overseas company seeking to carry on business in Seychelles is required to lodge with the Registrar of Companies: a certified copy of its charter, statutes, memorandum and articles of association or other instrument that constitutes the overseas company or contains the regulations that govern it; a list of its directors and secretary; the name of the person(s) appointed as managing agent or agents of the company in Seychelles; and the name of two or more persons appointed to accept on behalf of the company service of process and any notices to be served on the overseas company. An overseas company is considered to be carrying on business in Seychelles if it: enters into two or more contracts with residents in Seychelles, or with companies formed or incorporated there, being contracts which: are entered into in connection with the business or objects which the overseas company carries on or pursues; and by their expressed or implied terms are to be wholly or substantially performed in Seychelles; appoints an agent who resides, or has a place of business, in Seychelles to represent the overseas company in connection with the making or performance of two or more contracts that fall within the above paragraph, or in connection with the transactions of the overseas company in Seychelles generally, whether the appointment is made for a fixed period of time or not; 2
owns, possesses or uses assets situated in Seychelles for the purpose of carrying on or pursuing its business or objects, if it obtains or seeks to obtain from those assets directly or indirectly, any revenue, profit or gain, whether realized in Seychelles or not; or issues, or is deemed under section 48 of CA 72 to issue, in Seychelles a prospectus offering its shares or debentures for subscription or purchase. International business companies, being companies incorporated in Seychelles under the International Business Companies Act 1994, are permitted to carry on business outside Seychelles but are restricted from owning or leasing immovable property situated in Seychelles. Foreign Exchange Controls There are no foreign exchange restrictions. Taxation Taxes on acquisition and transfer of real estate and stamp duty on land transfers: Sanction application: 1.5% of the purchase price; and Stamp duty (transfer tax): 5% of the purchase price. Tax on rental income: No specific property income tax, but business tax is payable on rental income. Business tax is levied on the taxable income of a business (less any allowable deductions). The rates of business tax payable are: Sole Trader and Partnership: 0% on the first SCR 150,000 (USD 12,396) of taxable income, 15% on the next SCR 850,000 (USD 70,242) and 33% on the remainder; and Companies: 25% on the first SCR 1,000,000 (USD 82,637) and 33% on the remainder. Income tax and non-monetary benefits tax: Both Seychellois and non-seychellois employees pay 15% of gross emolument; and Non-monetary benefits tax employers are liable to pay 20% on the value of the non-monetary benefits provided to an employee. Value added tax ( VAT ): There are two rates of VAT a standard rate of 15% on most supplies of goods and services and 0% on a specific list of transactions. Certain goods and services are exempt from VAT. Excise tax: Excise tax is levied on four excisable goods (cigarettes or tobacco, alcohol, motor vehicles and petroleum products) imported into the Seychelles or manufactured locally. Trades tax: Trades tax is levied on imported goods. Taxation Treaties: Double Taxation Avoidance Agreements ( DTAA ) have been signed with the following countries and are in force: Bahrain - date of entry into force: 3 February 2012 Barbados - date of entry into force: 28 February 2008 Botswana - date of entry into force: 22 June 2005 China - date of entry into force: 17 January 2000 Cyprus - date of entry into force: 2 November 2006 Indonesia - date of entry into force: 16 May 2000 Malaysia - date of entry into force: 10 July 2006 Mauritius - date of entry into force: 22 June 2005 Oman - date of entry into force: 20 January 2004 Qatar - date of entry into force: 1 January 2008 South Africa - date of entry into force: 3 July 2002 Thailand - date of entry into force: 14 April 2006 UAE - date of entry into force: 23 April 2007 Vietnam - date of entry into force: 7 July 2006 Zambia - date of entry into force: 4 June 2012 DTAAs have been signed with the following countries, but are not yet in force: Belgium Bermuda Ethiopia Isle of Man Kuwait Lesotho Luxembourg Malawi Monaco Swaziland Sri Lanka Zimbabwe Tax Information Exchange Agreements have been signed with the following countries and are in force: Denmark - date of entry into force: 14 May 2012 Guernsey - date of entry into force: 14 May 2012 Iceland - date of entry into force: 14 May 2012 Seychelles Property Investment Guide 2014 3
SEYCHELLES The Netherlands - date of entry into force: 14 May 201 Norway - date of entry into force: 14 May 2012 Sweden - date of entry into force: 14 May 2012 The Faroes - date of entry into force: 14 May 2012 Real Estate Investment Trusts Real estate investment trusts ( REITS ) have not been established in Seychelles, and there are no REIT-specific regulations in the country. Links For more information on property investment in Seychelles, please visit the following websites: Seychelles International Business Authority: www.siba.net Seychelles Investment Bureau: www.sib.gov.sc Seychelles Revenue Commission: www.src.gov.sc 4
Appleby Malcolm Moller - Managing Partner tel +248 429 5283 seychelles@applebyglobal.com Jones Lang LaSalle 9 Raffles Place Republic Plaza Level 39 Singapore 048619 tel +65 6220 3888 www.joneslanglasalle.com.sg Level 2B, Caravelle House Manglier Street Victoria, Mahé Seychelles fax +248 422 5282 www.applebyglobal.com/locations/ seychelles.aspx Seychelles Property Investment Guide 2014 5
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