Tax Rates
Due to the delay in the 2025-2026 Budget Statement the Payroll Tax rates for April – June 2025 will remain the same as the 2024 rates shown in the schedules below.
Employee Portion Tax Calculators
The Employee Portion tax calculators for the pay period between April – June will be available under ‘Resources’ on this page by the first week of April 2025. These tools are provided to assist taxpayers with the calculation of employee payroll tax deductions. Visit https://www.youtube.com/@citvbermuda/playlists to view the Office of the Tax Commissioner training tutorials as a guide to using the calculators.
Watch this space for further Payroll Tax updates regarding the period July 2025 – March 2026 – to be provided after the May 2nd, 2025, Budget Statement is read by Premier and Finance Minister, the Hon. David Burt, JP, MP.
Tax Cap
The tax cap remains at $1,000,000 per person. This means that additional remuneration earned beyond $1,000,000 is not subject to tax. See the below Employee portion schedule for the applicable tax rates.
Tax Calculation - Employer Portion
The employer is required to pay tax on gross taxable remuneration as defined in the Payroll Tax Act 1995 based on the following rates:
| CLASS OF TAXPAYER |
RATE Apr-June 2025 |
| The Government, Parish Councils, Government Boards, the Bermuda College, approved schools, registered charities, religious and cultural organizations and the Bermuda Festival Ltd., New Start-up businesses (4 quarters) and an employer in an Economic Empowerment Zone (9 quarters). |
0% |
| New Hire remuneration and remuneration, (excluding dividend and bonus payments) paid to employees in Special Situations e.g. persons on jury duty or on duty with the Bermuda Regiment or Bermuda Volunteer Reserve, persons employed as farmers, fishermen or horticulturists, hotel and restaurant employees from November – March, retail employees from January – March, employees with permanent disabilities, employees on approved Training Schemes, persons or maternity or paternity leave, and persons hired as entertainers or musicians. |
0% |
| Self Employed Farmers and Fishermen |
0% |
| Taxpayers with an annual payroll less than $200,000 (or less than $50,000 p/qtr.), educational, sporting, or scientific institutions, associations or societies and horticulturists. |
1.00% |
| Taxpayers with annual remuneration of not less than $200,000 and not more than $350,000 (or < $87,500 p/qtr.); the Bermuda Hospitals Board and the Corporations of Hamilton and St. George’s |
2.50% |
| Taxpayers operating a restaurant or hotel with an annual payroll of $350,000 or greater (>$87,500 p/qtr.). |
5.00% |
| Taxpayers with annual remuneration of more than $350,000 and not more than $500,000 (>$87,500 up to $125,000 p/qtr.). |
5.25% |
| Retail Establishments with annual remuneration over $500,000 p/a (or >$125,000 p/qtr.) and whose primary business is the sale of fashion, shoes, jewelry and perfume. |
6.00% |
| Taxpayers with an annual payroll greater than $500,000 and up to $1,000,000 (>$125,000 up to $250,000 p/qtr.). |
7.50% |
| Taxpayers with an annual payroll greater than $1,000,000 p/a (>$250,000 p/qtr.) |
10.00% |
| All Exempt Undertakings |
10.25% |
Tax Calculation - Employee Portion
The EMPLOYEE portion of payroll tax must be calculated separately from the employer portion.
Employers have the option to deduct the employee portion of payroll tax from employees however the responsibility to pay the full amount of tax (i.e. employer plus employee portions) rests with the employer.
The EMPLOYEE portion is calculated across 5 tax bands using the marginal or progressive tax rate structure as follows:
|
ANNUAL REMUNERATION BANDS |
MAXIMUM PORTION OF REMUNERATION TAXABLE EACH PER BAND |
EMPLOYEE PORTION TAX RATES APRIL – JUNE 2025 |
|
0 - $48,000 |
$48,000 |
0.50% |
|
$48,0001 - $96,000 |
$48,000 |
9.25% |
|
$96,001 - $200,000 |
$104,000 |
10.00% |
|
$200,001 - $500,000 |
$300,000 |
11.50% |
|
$500,001 - $1,000,000 |
$500,000 |
12.50% |
|
MAXIMUM TAXABLE REMUNERATION |
$1,000,000 |
|
The marginal tax rate is the rate of tax that employees incur on each additional dollar of earnings. As earnings rise, each dollar of earnings above the previous level is taxed at a higher rate. For example, based on the rates for 2024-2025, a person who earns an annual rate of pay of $49,000 a year would be taxed at 0.50% on the first $48,000 and 9.25% on the balance of $1,000 which falls in Band 2. A person who earns $1m would be taxed across each of the 5 bands since a portion of his/her remuneration fits into each category.
It is important to note that the Progressive Tax rates are applied to each persons’ annual rate of pay. For employees that earn fluctuating amounts per pay period, the annual rate of pay must be recalculated each pay period so that the payroll tax can be adjusted accordingly. The pay period calculators found under Resources on this page can assist you when calculating the EMPLOYEE portion.
Reminders
E-tax
All taxpayers with payrolls of $200,000 or more per annum are reminded of the requirement to e-file with effect from the quarter April – June 2021. Penalties will be levied where tax is not submitted in the required format. To register please visit www.etax.gov.bm. The Office of the Tax Commissioner encourages all taxpayers to e-file for fast and easy reporting. Enquire at etax@gov.bm.
Tax Filing Dates:
Payroll Tax is due quarterly with a 15-day grace period at the end of the quarter. Employers and Self-employed persons who file late will be subject to late penalties and assessments. Please take note of the quarters and filing dates below:
- Remuneration earned between January – March must be declared and filed anytime between April 1st to the deadline of April 15th.
- Remuneration earned between April – June must be filed between July 1st to the deadline of July 15th.
- Remuneration earned between July – September must be filed between October 1st to the deadline of October 15th, and
- Remuneration earned between October – December must be filed between January 1st to the deadline of January 15th.
Books and Records:
Employers must keep adequate books and records in accordance with the Tax (Accounts and Records) Regulations 1991 in order to verify the declarations made on each tax return. Any person who submits false returns, fails to keep adequate records or to present them to the Office of the Tax Commissioner when requested, or evades tax payment in any way commits an offense and is subject to fines up to $500,000. The Tax Commissioner reserves the right to assess a value for undeclared remuneration under section 16 of the Taxes Management Act for any person to which in his opinion such person is chargeable.