Bermuda Payroll Tax and Pensions Explained for New Residents (2026–27)
This guide is general information, not legal, immigration or tax advice. Some links may be affiliate links. See our disclosure.
“No income tax” is true in Bermuda, but your payslip will still have deductions. The main ones are payroll tax, social insurance (contributory pension), occupational pension contributions and often your share of health insurance. This guide explains each using the Government’s own figures.
Payroll tax: the 2026–27 employee rates
Payroll tax is charged on remuneration. Employers pay a portion and employees pay a portion. For the tax year 1 April 2026 to 31 March 2027, the employee portion is charged at progressive rates (gov.bm):
| Annual remuneration band | Employee rate |
|---|---|
| $0 – $48,000 | 0.25% |
| $48,001 – $96,000 | 7.75% |
| $96,001 – $200,000 | 10.75% |
| $200,001 – $500,000 | 11.50% |
| $500,001 – $1,000,000 | 12.50% |
Remuneration above $1,000,000 isn’t taxed. That’s the cap per person.
These rates come from the Payroll Tax Amendment and Validation Act 2026, which took effect on 1 April 2026 (bermudalaws.bm). Compared with 2025–26 it:
- cut the first band from 0.50% to 0.25%,
- cut the second band from 9.25% to 7.75%,
- raised the third band from 10.00% to 10.75%, and
- cut the employer standard rate from 10.25% to 9.75%.
Source: the explanatory memo to the Bill (parliament.bm PDF).
How the bands work
The rates are marginal: each rate applies only to the slice of pay within its band. The Government’s example: someone earning $49,000 pays 0.25% on the first $48,000 and 7.75% on the remaining $1,000 (gov.bm).
Worked examples (employee portion only)
Salary $75,000
- $48,000 × 0.25% = $120
- $27,000 × 7.75% = $2,092.50
- Total ≈ $2,212.50 a year (≈ 2.95%)
Salary $120,000
- $48,000 × 0.25% = $120
- $48,000 × 7.75% = $3,720
- $24,000 × 10.75% = $2,580
- Total ≈ $6,420 a year (≈ 5.35%)
Salary $250,000
- $120 + $3,720
- $104,000 × 10.75% = $11,180
- $50,000 × 11.50% = $5,750
- Total ≈ $20,770 a year (≈ 8.3%)
These are our own calculations from the published bands. Your employer’s payroll may differ slightly because tax is worked out on your annual rate of pay each pay period (gov.bm).
Social insurance (contributory pension)
Bermuda’s Contributory Pensions Act 1970 sets up a state social insurance scheme funded by weekly contributions from employers and employees (bermudalaws.bm). The weekly rate is set in law and changes from time to time. Check the current figure on gov.bm or ask your employer’s payroll team.
UK link: the UK–Bermuda social security agreement covers Bermuda’s Contributory Pensions Act (legislation.gov.uk). HMRC says people working in Bermuda usually pay Bermuda contributions rather than UK National Insurance (gov.uk). See UK tax when you move to Bermuda.
Occupational pension
Under the National Pension Scheme (Occupational Pensions) Act 1998 (bermudalaws.bm), employers must provide a registered pension plan for eligible employees. The Pension Commission says the employer contributes 5% of pensionable earnings, alongside the employee’s required 5%. Employers may choose to pay some or all of the employee’s share. Contributions are vested and locked-in after one year of membership, or earlier if the plan allows (pensioncommission.bm).
Whether you must join depends on your status and how long you’ve worked in Bermuda. The Act and the Pension Commission set out the eligibility rules. Ask HR when you’ll be enrolled and what happens to your pot if you leave Bermuda.
Health insurance deductions
Employers must insure employees to at least Standard Health Benefit and may deduct up to half the standard premium from your pay (Standard Health Benefit Regulations). Richer plans may cost you more. See health insurance.
Putting it together: what to ask before you sign
- What’s my gross salary, and is any of it a housing or other allowance?
- Does the employer pay any of my payroll tax portion? Some do.
- What’s my weekly social insurance deduction?
- When do I join the occupational pension, and does the employer pay my 5%?
- What’s my share of the health insurance premium, for me and any family?
Then plug your net pay into our cost of living guide.
Self-employed?
The 2026 amendment also sets the self-employed standard rate at 9.75% (bermudalaws.bm). Remember that working in Bermuda, including self-employment, needs the right immigration permission.
Other Bermuda taxes you may meet
- Customs duty on imports: generally a standard 25% (Customs). See shipping.
- Foreign Currency Purchase Tax when banks convert BMD into other currencies, 1.25% according to the Bermudian dollar’s Wikipedia entry (Wikipedia). Ask your bank for its current charges.
- Land tax and stamp duty if you buy property (JBM Realty summary).
Sources checked 12 October 2026. Tax rates are set each April, so check gov.bm for the current year.
FAQ
Does Bermuda have income tax?
No personal income tax, but employees pay payroll tax, social insurance (contributory pension), occupational pension contributions and often a share of health insurance.
What are the 2026–27 payroll tax rates for employees?
0.25% on $0–$48,000, 7.75% on $48,001–$96,000, 10.75% on $96,001–$200,000, 11.50% on $200,001–$500,000 and 12.50% on $500,001–$1,000,000. Remuneration above $1,000,000 isn't taxed. The rates are marginal.
How much payroll tax would I pay on $120,000?
By our calculation from the published bands, about $6,420 a year for the employee portion: $120 on the first $48,000, $3,720 on the next $48,000 and $2,580 on the remaining $24,000.
How do occupational pensions work?
Employers must provide a registered pension plan for eligible employees. The Pension Commission says the employer contributes 5% of pensionable earnings alongside the employee's required 5%, and contributions vest after one year of membership.
Do I pay UK National Insurance while working in Bermuda?
HMRC says people working in Bermuda usually pay Bermuda contributions rather than UK National Insurance, under the UK–Bermuda social security agreement.