Bermuda’s Corporate Income Tax Regulations Now in Force

Following on from the Bermuda’s Corporate Income Tax Act 2023, the Government of Bermuda has now issued the Corporate Income Tax (Administrative) Regulations 2025 (the CIT Regulations), which took effect on 2 June 2025. These CIT Regulations provide the operational framework for the 15% corporate income tax regime introduced under the Corporate Income Tax Act 2023 (the CIT Act), effective from 1 January 2025.

Background

As we noted in our previous update, the CIT Act is part of a significant policy shift for Bermuda, aligning the jurisdiction with OECD Base Erosion and Profit Shifting (BEPS) Pillar Two standards. The CIT Regulations now set out the administrative, filing, and payment obligations for Bermuda constituent entities (BCEs) within scope.

Who is in scope?

The CIT Act applies to BCEs that are part of a multinational enterprise (MNE) group with annual consolidated revenue of EUR 750 million or more in at least two of the four fiscal years immediately preceding the relevant fiscal year.

• Bermuda exempted companies and partnerships not part of an MNE group remain out of scope.
• The 15% corporate income tax applies only to in-scope BCEs from fiscal years beginning on or after 1 January 2025.

Key Compliance Requirements for In-scope BCEs

Under the CIT Regulations:

• Designation of a filing BCE – Each BCE group must appoint a filing BCE responsible for filing returns and making payments. If no appointment is made by the original due date, the Corporate Income Tax Agency (CITA) may designate one.
• Registration –
  • Filing BCEs must register electronically with CITA at least 10 days before any instalment payment.
  • Non-filing BCEs must register no later than 90 days before the original due date for the group’s return.
  • Registrations must be kept up to date; cancellation is possible if prescribed conditions are met.
• Instalments – BCE groups are exempt from instalment payments if their annual corporate income tax liability is under USD10,000 or if their fiscal year is between 32 and 52 weeks. Otherwise, the Regulations prescribe calculation methods for the first and second instalments.
• Returns – Annual returns must be filed within 10 months of the fiscal year-end. CITA may issue its own assessment if returns are late, incomplete, or inaccurate, with interest and penalties applying. Amendments are permitted within three years, subject to exceptions.
• Over/under-payments – CITA may impose interest on underpayments. Overpayments may be reallocated to other BCEs in the same group at the filing BCE’s election.
• Record-keeping – BCEs must retain sufficient records for five years after filing and provide them to CITA upon request.

Next Steps

The CIT Regulations add significant procedural detail to the CIT Act’s framework. In-scope BCEs should:

• Review group structures to confirm scope status.
• Ensure timely designation and registration of a filing BCE.
• Implement systems for accurate calculation, filing, and payment in line with the Regulations.
• Maintain robust record-keeping to meet CITA’s requirements.

As with the CIT Act, the application of the CIT Regulations is complex and will require careful planning. We recommend that BCEs seek professional advice to ensure compliance and to manage potential risks.

For further information or assistance, please contact your usual Marbury relationship manager or email us at info@marburys.com.