Crypto Taxation in Bermuda

Is cryptocurrency taxed in Bermuda?

Bermuda imposes no personal income tax and no capital gains tax. According to the Government of Bermuda's official guidance, individuals do not pay income tax on wages, investment income, or asset disposals. [1] That zero-tax baseline extends fully to cryptocurrency: gains from buying, holding, or selling Bitcoin (BTC), Ether (ETH), stablecoins, or any other digital asset are not subject to any Bermuda tax at the individual level. There is no separate crypto-specific tax statute for individuals. Bermuda dollars (BMD) are pegged 1:1 to the US dollar (USD), so there is no currency-conversion tax exposure within Bermuda either.

For foreign nationals who relocate to Bermuda, the same rule applies while they are Bermuda-resident. However, most countries tax their citizens or former residents on worldwide income regardless of where they live; those individuals must still report gains in their home jurisdiction. US citizens, for example, remain subject to IRS reporting requirements under Notice 2014-21 and Revenue Ruling 2019-24 no matter where they reside. Anyone considering a Bermuda relocation for tax purposes should consult a qualified tax professional familiar with both Bermuda and their home country's rules.

What is the Digital Asset Business Act 2018 (DABA)?

Bermuda enacted the Digital Asset Business Act 2018 (DABA), administered by the Bermuda Monetary Authority (BMA), making it one of the first jurisdictions in the world to create a dedicated licensing regime for cryptocurrency and digital-asset businesses. [2] DABA regulates eight categories of digital-asset activity, including operating exchanges, issuing and redeeming tokens, providing custodial wallet services, running payment services, and offering lending and repurchase-transaction services.

The BMA issues three licence classes under DABA. A Class T (Test) licence is for proof-of-concept trials. A Class M (Modified) licence supports expanded but time-limited operations. A Class F (Full) licence permits all DABA activities on a permanent basis. Operating without a licence carries penalties of up to USD 250,000 or five years imprisonment. [3] The BMA updated custody rules in 2025 through the Digital Asset Business (Custody of Client Assets) Rules 2025, tightening obligations for licensed custodians.

Does the new 15% corporate income tax affect crypto companies?

Bermuda enacted the Corporate Income Tax Act 2023, introducing a 15% corporate income tax (CIT) effective for fiscal years beginning on or after 1 January 2025. [4] This tax applies only to Bermuda-based entities that are members of multinational enterprise (MNE) groups with consolidated annual revenue of EUR 750 million or more in at least two of the four preceding fiscal years. The legislation aligns Bermuda with the OECD Pillar Two Global Minimum Tax framework and qualifies as a Qualified Domestic Minimum Top-up Tax, preventing parent jurisdictions from imposing additional top-up taxes on Bermuda income.

For crypto businesses, the practical effect is targeted. Large, global crypto exchanges, asset managers, or technology groups whose group-level annual revenue exceeds EUR 750 million are in scope and face 15% CIT on Bermuda-sourced book income (with adjustments). Early-stage exchanges, crypto startups, investment funds, and individual investors fall outside the threshold entirely and remain untaxed. Businesses that received Tax Assurance Certificates under Bermuda's prior regime should note those certificates do not shield in-scope entities from the CIT, though they remain valid until 31 March 2035 for other purposes. An Economic Transition Adjustment (ETA) allows eligible entities to step up asset values to fair market value at 1 January 2025, eliminating CIT exposure on pre-2025 unrealized gains.

What payroll tax applies to employees of crypto firms in Bermuda?

Bermuda funds its public services primarily through payroll tax rather than income tax. Any employer operating in Bermuda, including licensed crypto businesses, must register and remit payroll tax on employee compensation. [5] Payments are due quarterly on 15 January, 15 April, 15 July, and 15 October. The tax cap is BMD 1,000,000 of remuneration per person per year.

The table below shows the rates in effect for the fiscal year 1 April 2025 to 31 March 2026.

The employer bears legal responsibility for remitting both the employer and employee portions, though employers may withhold the employee share from wages. Most licensed crypto businesses operating as exempted undertakings in Bermuda pay the 10.25% employer rate regardless of payroll size.

Do crypto investors need to report gains in Bermuda?

There is no Bermuda filing obligation for crypto investors. Because Bermuda has no personal income tax and no capital gains tax, there is no local return to file and no Bermuda tax to pay on gains from digital-asset sales, exchanges, or staking rewards. [1]

The critical point for international investors is that Bermuda's zero-tax treatment applies only to Bermuda domestic obligations. A US citizen who moves to Bermuda still owes US federal tax on worldwide crypto gains. A UK national who retains UK tax residency remains within the scope of HMRC's Cryptoassets Manual. Bermuda has no comprehensive tax-treaty network, so there are typically no double-tax treaty offsets available. Investors with cross-border positions should work with a qualified tax professional who understands the rules of their home country alongside Bermuda's regulatory landscape.

For practitioners who work with Bermuda-connected clients, the Bermuda country overview covers the broader tax and regulatory environment. Listings of cross-border tax professionals appear at /go/tax1099.