Bahamas Residency and US Credit: What the Residence Does and Does Not Do

The routes to residence: three tiers

The Bahamas have no golden visa with a glossy brochure. They have immigration law with several categories, decided by the Department of Immigration. For foreigners who do not want to work there, three tiers matter.

The Homeowner's Residence Card. Anyone who owns property in the Bahamas can apply for an annual card. It covers the owner, the spouse and minor children and allows entry and stay for the validity of the card, which is one year. It is renewed as long as you remain the owner and pay the fee. Important: the card facilitates entry, it does not confer resident status. It does not allow employment.

The Annual Residence Permit. The next tier is a residence permit granted year by year. It is aimed at people of independent means, typically homeowners or retirees. Applicants provide, among other things, a bank reference confirming their financial standing and character references. Here too: no right to work. Current sources quote different fees for this category. Only the Department of Immigration itself can confirm the amount in force.

Economic Permanent Residence. This is real permanent residence, and here something fundamental changed in 2025.

Permanent residence since 2025: 1 million dollars, ten-year holding period

Many guides still quote 750,000 dollars. That was the threshold until the end of 2024: owning a residence of that value earned accelerated consideration of a permanent residence application, and for major investors the mark was 1.5 million. Those figures are out of date.

Prime Minister Philip Davis announced in the 2024/25 budget that the minimum investment would rise by a third, and according to The Tribune's report the new rule has applied since 1 January 2025. The Department of Immigration now states the following conditions:

• A minimum investment of 1 million dollars.
• Two routes: either real estate or zero coupon bonds issued by the Central Bank of The Bahamas. What is new is that buying property is no longer the only option.
• A ten-year holding period. In both cases the asset must be held for at least ten years.
• No more gifts. According to the government, property transferred by deed of gift is no longer meant to count as an investment. That closes a route advisers used to like.

The bond route is the more attractive one for many: no property management, no vacant months, no hurricane insurance. In return, one million dollars sits for ten years without running interest in a zero coupon instrument of a small state. Get the redemption terms in writing before buying.

Permanent residence carries no minimum number of days on the islands per year. That is the appeal for many: the status stays in place even if you rarely visit. For tax purposes, that is exactly the problem, more on that below.

Taxes: what "tax free" means in the Bahamas

The Bahamas finance themselves through consumption and customs duties, not income. According to PwC's tax summary, reviewed in July 2026:

• No personal income tax.
• No capital gains tax.
• No inheritance, estate or gift tax.
• VAT at a standard 10 percent, 5 percent on certain essentials such as medical and hygiene products. Since 1 April 2026, unprepared food sold in food stores is exempt.
• Real property tax, with rates depending on value and classification. Foreign-owned property is its own category.
• Stamp duty on property conveyances.

For Germans and other Europeans, that is only half the calculation. A Bahamian residence permit does not end tax liability at home. What matters is whether a home or habitual abode remains there. Keep the apartment in Germany and you stay fully taxable in Germany, whatever card you hold in the Bahamas. And anyone who genuinely moves to a low-tax country such as the Bahamas can quickly fall under Germany's extended limited tax liability under section 2 of the Foreign Tax Act, which can apply for ten years after leaving. Holders of shares in corporations must also plan for exit taxation. The outcome always depends on the individual case and belongs with a tax adviser who knows both sides before the move.

Cost of living: tax free does not mean cheap

What you save on income you pay at the till. Almost everything is imported and carries duty and VAT. Groceries, according to consistent expat reports, sit well above mainland US price levels. Electricity is generated largely from imported fuel, and air conditioning runs most of the year, so the bills are high. Rents in Nassau and Freeport are above those on the smaller islands, while the Out Islands are weaker on supplies, flight connections and healthcare.

Then come the costs that appear in no tax summary: hurricane insurance, maintenance in salt air, a car because public transport is thin, and for serious medical cases often a flight to Florida. Monthly budget figures vary so widely between sources that they are of little use for planning. Anyone considering it seriously should live there for a few weeks before buying and write down their own spending.

The correction: Bahamas residency does not lead to an E-2 visa

This is the error some providers spread. The claim, roughly: if you are resident in the Bahamas, you can get the E-2 treaty investor visa through a US company. That is wrong for two reasons.

First: the Bahamas are not an E-2 treaty country. The E-2 visa exists only for nationals of countries with which the United States has a qualifying treaty of commerce or investment. The State Department keeps this list in the Foreign Affairs Manual (9 FAM 402.9-10). Alphabetically, Bahrain, Bangladesh and Belgium follow one another there. The Bahamas are missing. In the Caribbean, by contrast, Jamaica (E-2 since 1997) and Grenada (since 1989) are on the list. The detour through the UK treaty does not work either: the State Department notes explicitly that nationals of other Commonwealth countries do not qualify for treaty status under it.

Second: nationality counts, not residence. The Foreign Affairs Manual is unambiguous: the treaty investor must possess the nationality of the treaty country. For a business, the nationality of its owners decides, and the country of incorporation is expressly irrelevant. A residence permit, whether a homeowner's card or permanent residence, plays no role for the E-2. Bahamian citizenship, in turn, is not something you buy with an investment.

The point for German readers: Germany has been an E-2 treaty country since 14 July 1956. A German passport holder does not need the Bahamas for the E-2, the nationality requirement is already met. What the visa then actually demands, a real, operating investment in a US business, is covered in The E-2 Visa Through a US LLC.

What the Bahamas do for US credit: nothing

The second half of the promise does not hold up either. The three US credit bureaus, Experian, Equifax and TransUnion, know nothing about a Bahamian credit history, just as they know nothing about a German one. A Bahamian residence permit creates neither a Social Security Number nor a file at a US bureau. Someone applying for a US credit card from Nassau faces the same chicken-and-egg problem as someone in Munich: no score, no card, no card, no score.

Being close to Florida is convenient because a US branch is a short flight away. But that is equally true for any tourist with an ESTA. US creditworthiness rests on things that have nothing to do with where you live.

What actually helps with US credit

For non-residents there is a proven path, and it is largely independent of the country of residence. It has four building blocks.

• An ITIN. Without a Social Security Number you need an Individual Taxpayer Identification Number to apply for a card in your own name. The ITIN is only issued for a tax purpose, for example together with a US tax return or under a recognised exception. How the Form W-7 application works is in the ITIN guide.
• A US LLC. It provides a US address, a business bank account and later access to business cards. It does not replace a personal credit history, because US business cards check the owner personally first. And it comes with obligations: an LLC with a single foreign owner must file Form 5472 with the IRS every year, and the penalty for missing it is 25,000 dollars per form per year. Details in Setting Up a US LLC.
• A US banking relationship. An account at a large branch bank such as Chase or Bank of America is more than a payment channel. A bank that sees deposits, balances and payment behaviour looks more favourably on later card applications than one that only sees a name. Opening usually happens in person at a branch.
• Amex Global Card Transfer. This is the fastest lever. American Express takes an existing customer relationship in another country into account when you apply for a US card. Someone who has held a German Amex in good standing for a while can get a US Amex directly this way, without starting on a secured card. From then on Amex reports the payments to the US bureaus, and the score begins. Requirements and process are in the article on Amex Global Transfer.

The sequence makes more sense than any change of residence: apply for the ITIN, set up a US address and bank account, then Global Transfer or a first card, and after six to twelve months of on-time payments the next cards. None of this requires a residence in the Caribbean.

Who the Bahamas still make sense for

Looked at on their own, the Bahamas are a serious Plan B location, just for goals other than US credit.

• For wealthy individuals who genuinely leave home and want a tax-neutral base a short distance from the US. The million is then tied up in property or bonds anyway.
• For homeowners looking for a second home without needing permanent residence. The homeowner's card covers long stays without tying up a million.
• Not for people who want to work there. None of the categories above allows employment, that requires a separate work permit.
• Not as a shortcut into the US. Neither the visa nor credit gets easier through the Bahamas.