Question is: Can a foreigner buy land or house for sale in Sri Lanka? and how do foreigners living in Sri Lanka? I can buy land in Sri Lanka foreigner?
Answer: Foreigners can buy properties in Sri Lanka. Foreign nationals can mainly buy apartments and condominiums. Condominiums from apartments from 4th floor and above, lands can’t be bought by foreigners but can be leased up to 99 years.
Mainly condominiums can be purchased by paying the entire value upfront by an inward foreign remittance, and it’s mainly prior to the execution of the relevant deed of transfer.
Hence, therefore, private companies with a majority of shareholdings are allowed to purchase land or lease and mainly on a long-term basis.
These companies which are owned privately has to invest money at least 250 million excluding the value of the land.
Mainly any private ltd companies can buy or lease property in Sri Lanka, even public companies can buy properties for only 50% foreign ownership, and is only permitted to buy immovable property.
Even though foreigners are allowed to buy lands there involving a 100% tax transfer for foreigners here in Sri Lanka, this will be mainly doubling the price of the property, mainly we take them for long-term lease only.
A recent law has banned construction sites to build properties within 330 feet of the shore.
If a foreigner applies for a dual citizenship here in Sri Lanka then that person is entitled to set up a joint venture which someday later they can purchase a freehold property.
The foreign nationals can only hold a maximum of 49% shares from the property.
It’s a great opportunity for foreign nationals who are doing business in Sri Lanka because they can develop it into large projects.
Mainly when foreign nationals are looking for a bigger property investment they will have to go and speak with the BOI for approval. Depending on the property and investment you’re going to do the tax varies from 25% to 100% tax.
Can a foreigner buy land or house for sale in Sri Lanka? Most foreign nationals tend to buy from a local company so they can limit. Gazette notification of a foreign ownership:
Any foreign national who wants to buy a freehold title can purchase shares up to a maximum of 49% When buying a property from a local company. When the foreign national wants the shares to be transferred it will be done after a period of 20 years. In this case, a foreign national can use a local nominee to hold the balance shares of the company.
There is a stamp duty of 4% when purchasing a property. If the property is already a sole owned by the local company, then the foreign national has to transfer tax of 0.5% which should be paid.
This is mainly about the freehold of a property investment in Sri Lanka.
A foreign national having a foreign shareholding of 50% or more can purchase for a lease of 99yrs.
This is an additional amount of 15% land tax and the 4% stamp duty, but it’s different when a local has 50% or more shares of foreign shareholdings and has been operating for 10 conservative years or more, and then, in this case, the tax lease of the land will be reduced to 7.5%.
A foreign national or a local company holding foreign shares can purchase a condominium apartment from 4th floor or above, without no restrictions, as this is the apartment ownership law.
There are 4 obstacles for foreigners looking to own property in Sri Lanka.
- Lack of information about laws and regulations
- High taxes
- Lack of transparency in real estate
- Unprofessional real estate agents
The most important matter when buying a property in Sri Lanka you have to have a reliable an independent lawyer, you cannot buy any property without a lawyer advise, mainly the lawyer has to be a very professional and who can speak good English and as well as the native language of the seller.
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