Expat Tax Residency in Bermuda

Bermuda is one of the few jurisdictions in the world that levies no personal income tax whatsoever. For expats, that is the defining fact: becoming a Bermuda resident does not expose your earnings, investments, or savings to any Bermuda income-tax charge. What residency does require is an immigration permission, and what employment does carry is a share of payroll tax. This guide explains the real picture, including what you still owe back home.

Does living in Bermuda create an income-tax liability?

No. The Government of Bermuda officially confirms that individuals in Bermuda do not pay personal income tax. [1] There is no tax on employment income, self-employment income, capital gains, dividends, interest, or rental income at the individual level. There is no requirement to file an individual income-tax return with Bermuda. This position is not a concession or an expat carve-out -- it is the default rule for everyone on the island, Bermudian or foreign national.

The 15% corporate income tax enacted in 2025 does not change this. That levy applies exclusively to Bermuda entities belonging to multinational enterprise groups with annual consolidated revenue of EUR 750 million or more. [5] It has no effect on the tax position of individual residents or expats.

How do expats get permission to live and work in Bermuda?

Bermuda does not grant residency automatically. Non-Bermudians need an immigration permission. The main routes in 2026 are:

Standard work permit. Employers -- not employees -- apply through the Department of Immigration. [2] A standard work permit can run for one to five years and requires the employer to demonstrate that no suitably qualified Bermudian was available for the role. Expats cannot seek work while visiting as tourists; the employer files first and the work permission is issued before the foreign national begins.

Short-term and periodic permits. Short-term permits cover stays of up to six months. Periodic permits suit individuals who visit repeatedly for no more than 30 days per visit. A four-week-or-shorter assignment is exempt from payroll tax entirely.

Economic Investment Residential Certificate (EIRC). Introduced in 2021 and updated by policy revision in 2023, the EIRC gives high-net-worth individuals a residency right in exchange for a minimum BMD 2.5 million investment in the Bermudian economy. [3] Qualifying categories include purchasing residential or commercial real estate, providing equity to existing Bermuda businesses, starting a new Bermuda-based venture, contributing to registered charities, or investing in ventures the Minister designates as benefiting Bermuda. The minimum holding period is five years. Spouses and dependent children gain residency alongside the primary applicant. Processing fee as of the June 2024 policy document is BMD 2,625, with a BMD 2,755 fee for the Residential Certificate itself. Average actual investment across approved applications has reached approximately BMD 7.5 million.

Work From Bermuda Certificate (historical). The one-year digital-nomad certificate that allowed remote workers employed by non-Bermuda companies to live on the island was closed on 28 February 2025. [4] If you were relying on this route, the EIRC or a standard employer-sponsored work permit are the current alternatives.

What is payroll tax and how does it affect expat employees?

Payroll tax is Bermuda's primary mechanism for taxing employment. The legal obligation to remit falls on the employer, but the employee bears a portion that the employer withholds from wages. [1] For the period April 1, 2026 to March 31, 2027, employee rates are progressive:

The tax cap is BMD 1,000,000: remuneration above that threshold is not subject to payroll tax. [6] Employer rates depend on the employer's total annual payroll; large corporations (payroll above BMD 1 million) pay 9.50%, while exempt undertakings (international companies) pay 9.75%. Parliament passed payroll tax reductions effective April 2026, lowering rates across most employer categories from prior-year levels. [6]

Remuneration is interpreted broadly: salaries, bonuses, housing allowances, and stock option gains are all in scope. Self-employed individuals pay payroll tax directly.

Why do expats still owe tax to their home country?

Bermuda's zero income-tax environment removes any Bermuda-side income tax bill -- it does not eliminate obligations you carry from your country of citizenship or prior residence.

US citizens and green card holders are the clearest example. The United States taxes its citizens on worldwide income regardless of where they live or work. [7] A US citizen who moves to Bermuda on a work permit still owes the IRS a Form 1040 reporting all earnings. The Foreign Earned Income Exclusion (FEIE) may shelter a portion of earned income (USD 126,500 for 2024, indexed annually), but passive income, investment income, and amounts above the exclusion threshold remain taxable. Because Bermuda collects no income tax, there is typically no Bermuda tax to claim as a Foreign Tax Credit against the US bill.

US expats in Bermuda also face two additional reporting obligations. An FBAR (FinCEN Form 114) is required if aggregate foreign-account balances exceed USD 10,000 at any point during the year. Form 8938 applies if specified foreign financial assets exceed USD 200,000 on the last day of the tax year (or USD 300,000 at any point) for single filers residing abroad. Bermuda operates under a FATCA Model 2 IGA, meaning Bermudian financial institutions report account information directly to the IRS.

Citizens and former residents of the UK, Canada, Australia, and most EU countries face their own home-country rules. Many use a physical-presence or domicile test to determine continued tax residency even after emigration. Moving to a zero-tax jurisdiction does not by itself sever those ties; formal residency-break steps -- including tax-clearance filings and notifying revenue authorities -- are typically required before home-country obligations cease.

What other charges apply to Bermuda residents?

Beyond payroll tax, residents encounter land tax on owned or long-term-leased property, calculated on assessed annual rental value (rates range from 0.80% to 55% depending on value band). Customs duty of approximately 25% applies to most imported goods -- relevant given that nearly everything consumed in Bermuda is imported. Stamp duty applies to property transfers and certain legal instruments. There is no VAT, no sales tax, and no gift or inheritance tax.

For a full picture of Bermuda's jurisdiction, including its tax treaty status and country-specific guidance, see the Bermuda country overview.

The interaction between Bermuda's immigration permissions, your home-country filing obligations, and any payroll tax implications is fact-specific. Work with a qualified tax professional -- ideally one experienced in cross-border matters between Bermuda and your country of citizenship -- before making any relocation decisions.