Bermuda: A Strategic Choice for International Business

Bermuda Exempted Company Overview

Approvals and Beneficial Ownership

• Typically no approval required for a holding company or SPV where not carrying on a regulated business eg insurance, funds, banking, digital assets etc
• The Company must maintain a register of Beneficial Owners (generally meaning a 25% interest). The information is not publicly available

Incorporation

• Assuming all approvals and documentation are in place, typically 24hrs

Continuation and Discontinuation

• Processes similar to incorporation apply for easy continuation / discontinuation into and out of Bermuda

Economic Substance

• Economic substance requirements vary by business activity
• A holding company will be subject to de minimis requirements
• Not applicable where entity is tax resident in another recognised jurisdiction  

Registered Office • Required and a matter of public record

• Required and a matter of public record

Shareholders

• Minimum of one shareholder. Register kept at registered office and available for inspection by public

Directors

• Minimum of one director, which may be a company or person. Typically one director or the secretary must be resident in Bermuda 
• Register of directors is filed with the Registrar of Companies

Tax

• Typically no tax on exempted companies; corporate income tax may apply to large multinational entities
• No withholding taxes on dividends and interest payments

Audit

• Shareholders may waive the requirement to appoint an auditor
• Generally, no requirement to file accounts

Fees and expenses

• Annual government fee varies depending on the authorised share capital. Minimum amount is currently $2,095
• All in initial professional fees and disbursements (inclusive of annual government fee above) can be as low as $7k for simple cases
• Our annual corporate secretarial fee (which includes a registered office) starts at $6.5k

Regulatory Recognition

• Whilst Bermuda shares many advantages with other international business jurisdictions, it lacks some of their disadvantages. For example, Bermuda is recognised by the OECD, FATF, and EU as a cooperative jurisdiction

Reputation

Bermuda is one of the world’s leading international business jurisdictions, known for its political stability, robust legal framework, regulatory consistency, and global reputation for transparency and compliance. It serves as a premier hub for insurance, reinsurance, investment funds, digital assets, commodity companies and financial services, attracting global corporations, growth businesses, institutional investors, and high-net-worth individuals.

Tax Efficiency

Bermuda historically has imposed no taxes on profits, income, dividends or capital gains. The Bermuda government grants tax assurance certificates to exempt companies that any future introduction of tax by the Bermuda government will not apply until at least March 2035.

Following the OECD’s global minimum tax framework, a 15% corporate income tax applies to multinational enterprises with annual revenues exceeding €750 million in at least two of the proceeding periods that are not tax resident in another compliant jurisdiction. A majority of entities remain unaffected, and tax credits are available.

Bermuda does not impose withholding taxes on any payments, including those related to profits, income, dividends, or capital gains.

Legal & Regulatory Framework

English Common Law

British Overseas Territory with a long history of adherence to the rule of law. Bermuda’s legal system is based on English common law, providing a familiar and predictable framework for international businesses.

The ultimate right of appeal is to the Judicial Committee of the Privy Council, composed of UK Supreme Court judges.

Flexible legal structures

International businesses can choose from several legal structures depending on their priorities, such as an exempted company or partnership, Bermuda LLC, Segregated Account Company (SAC) and Incorporated SAC.

Business legislation is notably permissive. For example, under the Bermuda Companies Act board and shareholder rights can be tailored to the governance requirements of businesses.

Economic Substance

Bermuda is widely considered the “blue-chip” offshore jurisdiction, preferred by institutional investors and Fortune 500 companies. It has implemented economic substance rules in line with OECD standards.

Requirements vary by activity. For example, pure holding entities must meet the minimum economic substance requirement, whilst banking, insurance, fund management, digital asset entities etc. must demonstrate that their core income-generating activities are in Bermuda. Subject to conditions, an exemption is available for Bermuda registered companies that are resident for tax purposes in certain compliant jurisdictions outside of Bermuda.

Regulation

The Bermuda Monetary Authority (BMA) is globally respected and has oversight of a number of key sectors, including insurance, banking, funds and digital assets. The BMA’s follows the proportionality principle, which fosters growth whilst also earning recognition from the OECD, FATF, and the EU as a cooperative jurisdiction, which compares favourably to some other jurisdictions. This dual advantage allows businesses to operate efficiently without compromising reputational standards.

Exchange Control

Exempted companies are not subject to exchange control regulations, so are free to make dividend, interest and capital payments, as well as deal in foreign exchange and securities.

Political Stability

Policy Continuity under the recently re-elected Progressive Labour Party government, who have been in power for 23 of the last 27 years.

Pro-Growth and pro-Business agenda shared by the two main political parties.

Economic Stability

S&P has recently reaffirmed Bermuda’s long-term sovereign credit rating at ‘A+’ and its short- term rating at ‘A-1’, with a stable outlook.

Morningstar recently upgraded Bermuda’s long-term issuer ratings to A (high) and upgraded its short-term ratings to R-1 (middle).

Professional Infrastructure

Bermuda has a deep pool of professionals across accounting, legal, actuarial, investment, and corporate administration service lines.

Efficient incorporation and compliance processes, with digital registration systems and modern corporate governance rules.

Strategic Location

Situated between North America and Europe, Bermuda offers a convenient time zone and direct access to major international airports. Travel times include 90 minutes from New York, two hours from Toronto, and seven hours from London.

Lifestyle & Amenities

The island features world-famous beaches, a wide range of hotels, six championship golf courses, and hosts global sporting events like the PGA and SailGP. Bermuda also offers high-quality education and healthcare services.

Working with Wakefield Quin

Wakefield Quin is a leading independent law firm in Bermuda. We have highly rated corporate, regulatory, litigation and property practices, experienced in advising clients across the main sectors in the jurisdiction.

We can provide company secretarial, directorial, fund management and trust administration services through our affiliated businesses, M Q Services, Harbour Financial and Winchester Global Trust.

This note has been prepared for information purposes only. Please contact us should you wish to discuss in more detail.

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