Why do we have to pay taxes?
In most communities it has proved beneficial for certain services to be provided by a central body rather than by private individuals either for themselves or for others. The obvious examples of these services are defence, health, education, the emergency services (ambulance, fire and police), public highways, public parks and garbage disposal. To maintain these services finances must be made available and for such community-wide services the best method is usually one that involves some community-wide charge or tax.

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Why a tax on land?
Land taxes are some of the most simple, effective, open and cheapest taxes to administer and collect. In addition, revenues from land taxes are both stable and predictable unlike say import duties or an income tax which can fluctuate widely from year to year. Land taxes are also difficult to evade because the liability attaches to the property itself in the final resort. Property taxes also reflect, in general, some "ability to pay" in so far as people with more resources tend to live in higher value properties and this aspect is further enhanced by Bermuda's progressive land tax structure. Finally, it is fair to say that community-wide benefits tend to impact to a significant degree on property values so that each taxpayer does receive some benefit from the payment of taxes that go to improve the quality of life and the environment in the community.

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Who may receive relief from land tax?
Relief from land tax may be available in certain circumstances:

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When is land tax payable?
The calendar year is divided into two six-monthly Land Tax periods, commencing on the 1st January and the 1st July. Tax is levied in respect of both of these periods and demand notes (bills) are sent to taxpayers commencing January and July.

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Who determines the rate of tax?
The rates of tax are proposed by the Minister of Finance and are subject to the approval of the Legislature. For the current amount of land tax that will be levied on your ARV, go to the Tax Payable page.

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What is the basis of valuation for land tax purposes?
The basis adopted at the present time in Bermuda for assessment is that of "Annual Rental Value" (ARV). This represents the annual rental value of the property if let unfurnished on the open-market on the assumption that the tenant pays for internal repairs and the landlord pays for all other expenses necessary to maintain the property and is exclusive of any amount attributable to land tax itself. This means that the normal market forces of demand and supply are to be taken into account and special circumstances are excluded or compensated for such as old leases, lettings subject to rent control, to sitting-tenants or to relatives and friends. Basically, it is an estimate of the rental value of all properties (whether rented or owner-occupied) that assumes a standard set of hypothetical terms as the basis for each assessment but using actual market evidence as the source for all assessed levels of value. As part of this process of standardisation each property is also assumed to be in good repair having regard to its age, character and the locality it is situated in.

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How is the ARV Determined?
The Land Valuation Officer obtains, in confidence, details of all rentals from owners or occupiers of property throughout Bermuda for each Revaluation. He then analyses these transactions to isolate the value effect of various property characteristics. Using this evidence he then assesses all properties having due regard to differences for location, quality, size and other advantages or disadvantages associated with each property or groups of properties. The resulting assessment may be higher or lower than actual rents paid for properties if they are not let on the same terms as the statutory basis that he must assume.

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Why are the ARVs revalued?
The Act requires a revaluation of all valuation units every five years. All properties are revalued at the same time to maintain equity in the valuation list. Property values change over time and these changes are not uniform across the market. Some property types and areas go up in value more than others do. The revaluation "re-levels the playing field" by reflecting these relative changes in value so that the equity of the valuation list is maintained. As each valuation list stays in effect for five years, the list is referred to by the year in which it went on deposit. The current valuation list is therefore referred to as the 2009 Valuation List which is due to be replaced by the 2014 Valuation List on the 1st January 2015.

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Where do I find the ARV of my property?
Details of each property are entered in the Valuation List and may be found by using the search engine on this web site. To identify your property you will need to know either:

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How is the valuation list kept up-to-date?
As existing properties are altered, new properties built or others demolished, the Land Valuation Officer makes changes to the Valuation List. Notices from the Planning Department, information from owners or occupiers and periodic re-inspections by his own staff will bring these changes to his attention. A member of the Land Valuation Department will inspect the property and record details necessary for valuation purposes. The Land Valuation Department will then value the property, having regard to the established levels of value in the Valuation List and serve a notice on the owner indicating the alterations. The Valuation List will be amended at the same time.

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Can I object to my revised ARV?
You may object to a proposal to amend the valuation list within 31 days of the date of the proposal on one of the specified grounds, namely

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What other matters are affected by entries in the Valuation List?
A number of other matters are affected by the entries in the Valuation List and some of these are set out below:

1.       Registration of motor cars.
In order to register a private motor car at the Transport Control Department an owner must show that it is the only vehicle registered at that valuation unit in the case of a private dwelling. To do this it is necessary to provide the Transport Control Department with the assessment number of the unit at which the car owner resides. You should also know the correct official address for the property as this is also recorded. These details can be found on the Land Tax Demand Note for the property or on printed versions of the Valuation List on display at Transport Control. If your property is a new property, you will need to contact the Land Valuation Department for an assessment number but this can only be given if the Planning Department have issued a Certificate of Completion and Occupancy for that unit.

2.       Sales to non-Bermudians
A house may be sold to a non-Bermudian, with the consent of the Minister of Labour, Home Affairs and Public Safety, if it has an ARV greater than or equal to $153,000 and it is currently held under licence by a non-Bermudian. In the case of a condominium, properties in certain developments are available to non-Bermudians, again with the consent of the Minister, if they are designated units and currently held under licence by a non-Bermudian. The above information should not be taken as a definite explanation of the provisions of the Immigration Act and Ministers policy. Should you wish further information about Immigration matters, please contact the Immigration Department on 295-5151- x1941

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Administration
The Rent Commission comes under the authority of the Minister of Health and Family Services and is charged with the responsibility for administrating the Rent Increases (Domestic Premises) Control Act 1978.

Application of the Law
The provisions of the Rent Increases (Domestic Premises) Control Act 1978 apply to a tenancy of any residential dwelling were such dwelling has an Annual Rental Value (ARV) as determined by the current Land Valuation List of $27,000 or less.

Objectives of the Law
The purpose of the Rent Increases (Domestic Premises) Control Act 1978 is twofold:

Rent Increase Controls
Where a tenant is in occupation of premises, there are only two ways whereby a landlord may increase the rent:

• By the landlord and tenant reaching agreement on the increase.
• By the landlord applying to the Rent Commissioner for a rent increase.

Increase in Rent by Agreement
If a landlord and tenant reach an agreement on an increase of rent, the landlord must lodge a notice in the specified form with the Rent Commissioner, notifying him of such increase. Upon receipt of the notice, the Rent Commissioner shall record and endorse the agreement and shall return a copy of the notice to the landlord and one to the tenant. It is unlawful for a landlord to exercise any improper pressure on a tenant (as, for instance a threat to serve a notice to quit) in order to obtain an agreement to a proposed increase of rent. It should be understood that a tenant does not have to agree to an increase of rent proposed by his landlord. If a tenant considers a proposed increase to be unreasonable, he may refuse to sign the agreement form and request that the landlord apply to the Rent Commissioner for his approval to increase the rent.

Increase in Rent by Application
If a tenant does not agree to a proposed increase of rent, the landlord must apply to the Rent Commissioner for approval to increase the rent. Upon receipt of the application, the Rent Commissioner shall serve a copy of the application on the tenant for his comments. Upon receipt of the tenant’s comments or after one month from the service of the application on the tenant, the Rent Commissioner shall adjudicate the application and issue his certificate, a copy of which is sent to the landlord and one to the tenant. If the landlord or tenant is not satisfied with the increase of rent assessed for the premises, he may apply to have the terms of the initial rent increase certificate reviewed by the Rent Commissioner. In such a case, the application for review is sent by the Rent Commissioner to the other party for his comments, and then the Rent Commissioner reviews the case in consultation with the Rent Increases Advisory Panel. If, after the review, the landlord or tenant feels aggrieved by the Rent Commissioner’s decision, the landlord or tenant may appeal to the court against the Rent Commissioner’s decision. The court will not interfere with the Rent Commissioner’s ruling unless satisfied that the decision was manifestly unfair and unreasonable.

Increase in Rent Prior to Reletting the Premises to a New Tenant
Where a landlord wishes to charge a prospective tenant a rent, which is in excess of the maximum chargeable under the Act, the landlord must first apply to the Rent Commissioner for his authority to increase the rent. The procedure in this case is similar to that outlined above, except that the tenant who is vacating the premises and the prospective tenant are not consulted regarding the landlord’s application.

Unlawful Rent Increases
Where a landlord has charged a rent, which is in excess of the maximum rent chargeable under the Act, the tenant, may recover from the landlord the excess so charged. However, no amount, which a tenant is entitled to recover, shall be recoverable at any time after the expiry of two years from the date of payment.

• Grounds for Termination of Tenancies
• A landlord may serve on a tenant a notice to quit on any of the below grounds:
• The tenant breaches a term of the rental agreement.
• The landlord wants to move into the rental dwelling, or give it to an immediate family member (father, mother, child or grandchild)
• The landlord wants to substantially remodel or rebuild the rental dwelling, which requires the tenant to move out.
• The tenant creates a nuisance or annoyance by disturbing the landlord or other tenants or engaging in illegal activity on the premises.

After proper notice has been given to a tenant and the specified time period has passed without the tenant vacating the premises, the landlord must apply to the court to get possession of his premises. A summons is served on the tenant to appear before the court. The court then hears the matter and rules on the application. The court may order for immediate possession, but usually the tenant is given a reasonable period of time to move out voluntarily. If the tenant fails to comply with the court’s order, that is to move out of the rental premises by the date ordered by the court, the landlord shall be entitled to take out a warrant directing the Provost Marshall General to evict the tenant from the premises. Once the court authorizes the warrant to evict, the landlord can then remove the tenant from the rental premises.

Rental Deposit/Key Money
It is lawful for a landlord to demand from a tenant the payment of a deposit not exceeding a fortnight's rent. The payment of "key money" by a tenant is unlawful, and any such payment may be recovered from the landlord. "Key money" is a payment of any premium as a condition for the grant of a tenancy.

Where to Get Information About Rent Control
The above information should not be taken as a definite explanation of the provisions of the Rent Increases (Domestic Premises) Control Act 1978, as there are too many other factors that may influence any particular case. Should you wish further information about the rent control laws, please visit the Rent Commission at Rego Building, 75 Reid Street , Hamilton or telephone 297-7700 or 297-7701.

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Land Tax (Mail)
The Land Tax Officer
Tax Commissioner's Department
P O Box HM 656
Hamilton HM CX

(Personal Calls)
Tax Commissioner's Office
Perry Building
40 Church Street HM 12
Hamilton
Tel: (441) 297-7537 or (441) 297-7669

Land Valuation (Mail)
The Land Valuation Officer
Land Valuation Department
P O Box HM 1384
Hamilton HM FX

(Personal Calls)
The Land Valuation Department
Second Floor, Global House
43 Church Street
Hamilton
Tel: (441) 297-7964 fax (441) 292-4498

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