The Cayman Islands, which offer a piece of paradise sweetened by generous tax incentives and excellent healthcare, are a major lure for ultra-high-net-worth retirees who are drawn by the idea of spending their golden years in a picture-postcard setting.

The self-governing British Overseas Territory, which is 90 miles south of Cuba in the Caribbean Sea and an hour’s flight from Miami, comprises three islands that are home to some 69,000 residents.

Grand Cayman, the largest one, attracts cruise-ship tourists and global attention. Little Cayman (population about 200) and Cayman Brac (population about 2,000), the so-called Sister Islands, are off the beaten path (they are accessible by prop plane) and, for the most part, off the radar of the affluent.

The well-to-do residents—expat families, professionals, captains of finance, second-home purchasers and full-time retirees—hail from all over the world.

“There are more Caymanians than non-Caymanians over 50, but that is changing,” said J.C. Calhoun, broker/owner of Coldwell Banker Cayman Islands Realty. “As Cayman has developed, more people are spending more and more time here, and the average age is increasing. Many are here for half of the year—from November through April—with shorter stays in between.”

A combination of amenities, some man-made, some created by nature, are luring them.

“Our natural wonders, no restrictions on foreign home ownership, charming residents, robust infrastructure, safe neighborhoods, direct flights to the U.S., Canada and the U.K, native-English speakers, tropical climate and tax-neutral status make the Cayman Islands a hard-to-beat destination,” said Sheena Conolly, CEO and broker-owner of Cayman Islands Sotheby’s International Realty.

Mr. Calhoun said that American retirees feel right at home because not only is English spoken but also U.S. currency is accepted.

One of the more enticing features of the Cayman Islands for retirees is the financial incentive: Residents are not taxed on income, purchased or leased properties, inheritances or capital gains, and there is no VAT, or value-added tax.


However, there are duties of 7% to 42% on almost all imported goods, which Mr. Calhoun noted makes “all goods and services more costly than most places.”

And the territory’s residency laws for foreigners are especially golden. Upon purchase of a property or an investment of US$1.2 million or more, a renewable Residency of Persons of Independent Means certificate that entitles the holder, a spouse and their dependent children to live there for 25 uninterrupted years, is granted. Purchasers must show proof of an annual income of at least US$144,000, and it must be earned from sources outside the Cayman Islands.

Another option is the Certificate of Permanent Residence for Persons of Independent Means, which essentially allows the holder to become a British Overseas Territories Citizen then eventually apply for Caymanian citizenship after investing a minimum of US$2.4 million in developed real estate. These certificates are limited to 250 per year.

And the government, noted Heidi Kiss, broker/owner at Engel & Völkers Cayman Islands, actively “encourages foreign ownership.”

Healthcare, another major issue for those who are retired, is also easily accessible via the islands’ four hospitals and a number of clinics.

All residents are required to buy a private insurance policy (there are several vendors on the islands).

Ms. Conolly pointed out that the Cayman Islands are close enough to the U.S. that residents can get care for chronic conditions there if they prefer.

“Our trio of little islands provides some of the best-quality health-care in the world,” she said. “Plus, with two new hospitals coming soon, this level of excellence will only increase.”

Ms. Kiss added that health insurance coverage and premiums are about the same as those in the U.S..

It’s also a very safe place to live. “All three islands have a low crime rate,” Ms. Kiss said. “And most police officers do not carry guns. One can walk down the streets or beach day or night alone and not be harassed.”

For those who do want to travel, the Cayman Islands is conveniently located: There are direct flights to Denver, Los Angeles, Atlanta, Charlotte, New York, London and Toronto.

“In short, Cayman has all the amenities that you would normally have to visit several places to find,” Mr. Calhoun said. “In Cayman, you can find them all in one place.”