Executive summary

On 12 May 2025, the Government of Bermuda issued final regulations concerning corporate income tax (CIT) provisions. These regulations finalize the draft regulations issued in the Third Public Consultation on 17 February 2025.

The Corporate Income Tax (Administrative) Regulations 2025 (Final Administrative Regulations) are presented in five parts. An introduction is followed by provisions on: (1) registration and general administration; (2) payment of taxes; (3) returns; and (4) enquiries, assessments and clearance. These Final Administrative Regulations will come into operation on 2 June 2025.

Background

In December 2023, the Bermuda Parliament passed legislation enacting a 15% CIT regime that became effective for tax years beginning on or after 1 January 2025 (the Principal Act). (See EY Global Tax Alert, Bermuda Parliament passes legislation to enact a 15% corporate income tax, dated 22 December 2023.)

The CIT will apply to Bermuda Constituent Entities (BCEs) that are part of multinational enterprise groups with annual revenue of €750m or more (In-Scope MNE Groups).

In July 2024, Parliament passed the Corporate Income Tax Agency Act 2024 (the Agency Act), which establishes a Corporate Income Tax Agency (the Agency) to administer the CIT regime.

On 17 February 2025, a third public consultation related to administrative provisions (Proposed Administrative Regulations) outlined a wide range of provisions related to the orderly administration of the CIT. (See EY Global Tax Alert, Bermuda releases third public consultation for CIT administrative provisions, dated 25 February 2025.)

Significant changes in the final regulations

Date convention

The Final Administrative Regulations clarify how deadlines or due dates are to be determined under the Principal Act, the Agency Act or any Agency-delivered notices that fall on weekends or public holidays. In particular, if a specified date does not fall on a business day in Bermuda, the relevant deadline or due date shall be deemed to fall on the first business day in Bermuda following the date that would otherwise apply.

Registration requirement

The registration provisions impose timeframes for both existing and newly formed entities to register. Under the Proposed Administrative Regulations, each BCE would have been required to register by the earlier of:

• 30 days before the due date of any required installment payment
• Nine months before the tax return's original due date
• 90 days after the BCE's formation, incorporation or registration

The Final Administrative Regulations have changed this timeframe to:

• 10 days before the due date of any required installment payment if the entity is the Filing BCE
• At least 90 days before the tax return's original due date, for all other entities

Form of registration

The Final Administrative Regulations clarify that the Agency may accept the registration of any organization or person that is not a BCE for the purpose of allowing that organization or person to act as an authorized representative.

As part of the registration process, the regulations also clarify that the Agency may issue unique identifiers for registered organizations or persons.

Installment payments

Two installment payments will be required prior to filing the tax return. The Proposed Administrative Regulations indicated that the first payment would be due by the 15th day of the eighth month of the fiscal year (i.e., 15 August if the fiscal year is the calendar year). The Final Administrative Regulations change the due date to the last day of the eighth month of the fiscal year (i.e., 31 August if the fiscal year is the calendar year).

No changes were made to the timing for the second installment payment, which must be paid by the 15th day of the 12th month of the fiscal year (i.e., 15 December if the fiscal year is the calendar year).

Implications

The Final Administrative Regulations outline detail provisions on how the CIT will be administered, including filing and registration requirements, payments of tax, and enquiry and dispute processes. Changes from the Proposed Administrative Regulations ease timelines for registration and payments as a result of the public consultation. Multinational groups with Bermuda operations should carefully review Final Administrative Regulations and consider their likely impact on the organization and tax processes.