The budget statement delivered on Friday, February 22, 2019 by the Hon. Curtis L. Dickinson, JP, MP resulted in the following changes to be implemented by the Office of the Tax Commissioner. All changes will be effective from April 1, 2019 unless stated otherwise.
It is mandatory for all taxpayers with payrolls of $500,000 or more p/a to e-file. Penalties will be levied where tax is not submitted in the required format starting from the quarter April – June 2019 with payment due by July 15th, 2019. 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.
Payroll Tax Relief for the Retail Sector
Retail Establishments whose payroll is above $500,000 per annum and whose primary sales are in fashion, shoes, jewelry, and perfume will pay a concessionary Employer Portion tax rate of 7%.
Primary for the purposes of this concession means that 50% or more of the revenue generated in the business must be derived from sales in clothing, shoes, jewelry, or perfume.
Establishments taking advantage of the 7% rate will be subject to further enquiry by the Office of the Tax Commissioner. If you are unsure about your eligibility please submit your query to email@example.com. Include the tax identification number and a summary of all revenue streams with the corresponding percentage to total revenue. The Tax Commissioners Office reserves the right to request further back up documentation to verify the information presented.
Payroll Tax Relief for Employers who engage Local Musicians and Entertainers
For the period April 1, 2019 – March 31, 2022 all businesses that hire local musicians and entertainers will pay a rate of 0% of Payroll Tax for both the Employer and Employee Portions on the remuneration paid to these persons. Tax returns must include the number of Musicians and Entertainers engaged in the period with the total remuneration paid to these persons. This amount will not be included in remuneration subject to tax.
For full details on the application of Payroll Tax after April 1, 2019 please visit Calculating Payroll Tax for the period April 1, 2019 – March 31, 2020.
Financial Services Tax
Banks: Effective April 1, 2019 tax will increase from 0.005% to 0.0075% on consolidated gross assets as at the end of a tax period.
Domestic Insurers: Effective May 1, 2019 tax on gross premiums written in a tax period will increase from 2.5% to 3.5%.
Money Services Business: The tax will remain at 1% on aggregated outgoing money transmission volume in a tax period.
Foreign Currency Purchase Tax (FCPT)
FCPT will increase from 1.0% to 1.25% effective April 1, 2019.
Current land tax rates can be found at https://www.gov.bm/land-tax.
Rental leases will incur a duty of 1% of the rent payable. Leases three years or longer will incur a duty of 1% of the rent payable for the first three years of the lease, plus 0.5% of the aggregate rent payable for any additional period.
There will be no stamp duty on any mortgage refinancing for amounts up to $750,000.
Passenger Cabin Tax has been repealed with effect from April 1, 2019. Instead there will be a Passenger Departure Tax and a Large Ship Infrastructure Tax. In addition the Bermuda Tourism Authority will administer a Cruise Ship Passenger fee.