Bermuda

Social insurance

Bermuda’s contributory pension scheme requires employers to make monthly contributions to the Contributory Pensions Fund for every employee above 18 years of age for each week in which the employee works more than four hours. An employer must ensure that each qualifying employee registers with the department and obtains a social insurance number. Civil and criminal penalties may apply to employers for failure to register or pay in for each qualifying employee.

Employees contribute a matching sum via weekly payroll deduction, with several exceptions. Full time students under age 26 who are employed during holidays, weekends and summer breaks, and their employers, are entirely exempt from social insurance contributions. Employees over the age of 65 are exempt from contributing their half, although the employer must still contribute its part.

The current total contribution per employee per week is BMD 71.84. The employer portion is BMD 35.92 and the employee portion is BMD 35.92. Self-employed individuals must contribute both the employer and employee portions.

Expatriate and other employees who pay into the system but fail to qualify for a pension due to insufficient contributions may apply at age 65 for a refund of the total value of the contributions made on their behalf, including both employer and employee contributions.

Payroll tax

Bermuda imposes a payroll tax on employers at a rate determined by employer category or total annual payroll. See the Other taxes section in the Corporate tax summary for more information.

Consumption taxes

Value-added tax (VAT) 

There is no VAT or sales tax in Bermuda.

Property taxes

See the Other taxes section in the Corporate tax summary for more information in relation to property taxes.

Vacation rental tax

See the Other taxes section in the Corporate tax summary for more information in relation to vacation rental taxes.

Customs duties

Customs import duties are imposed on almost all goods arriving on the island at varying rates, with a BMD 200 per passenger per landing exemption for residents and BMD 50 for non-residents. The most common rate of customs import duties is at 25% though note that other varying rates may apply. 

Customs duties are waived for new residents for their personal and professional goods for a period of 90 days from the date of arrival to set up residence in Bermuda. To qualify for the exemption, the goods must have been in the possession of the new resident for a prior period of six months.

Excise taxes

There are no excise taxes imposed in Bermuda.

Transfer taxes

There is no transfer tax imposed in Bermuda.

Stamp duty

Bermuda imposes stamp duty on a wide variety of legal instruments, such as transfers of property, deeds, and rental agreements. Rates vary according to the type of instrument and its value; these rates are periodically updated by Parliament.

Foreign currency purchase tax

There is a foreign currency purchase tax imposed at the rate of 1.25% on foreign currency purchased by a Bermuda resident from a local bank.