About the New Start-ups Payroll Tax Relief Program
The Government of Bermuda has pledged to provide new tax relief for entrepreneurs of new startups to assist them in creating new jobs. Therefore, entrepreneurs who register and meet the criteria established by the BEDC in the creation of a new business will be exempt from the employer portion of payroll tax for themselves (if owner-managed or self-employed) and any employees for the first year of business (first four quarters in operation).
This programme applies to all new startup businesses established in Bermuda after April 1st, 2018. This relief only applies to small businesses as per the definition in the BEDC Act 1980.
A fully completed application form with required documents including; a copy of a valid ID; a copy of the signed lease agreement; a copy of a utility bill; the list of all employees employed with the business within its f irst year of operation; and any other documents as required that BEDC deems necessary to make
an informed decision about the application.
- Application due dates are as follows:
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- For tax period January to March, applications must be received by March 16th;
- For tax period April to June, applications must be received by June 16th;
- For tax period July to September, applications must be received by September 16th; and
- For tax period September to December, the application must be received by December 16th.
- BEDC’s Officers may conduct site visits to the physical business to confirm the business is legitimately operating.
- BEDC’s Officers will check with the Office of Tax Commissioner; the Department of Social Insurance; the Registrar of Companies to ensure the business is legally registered and meeting its obligations.
- BEDC’s Officers, once satisfied with the information provided, make a recommendation for approval or refusal to BEDC’s Executive Director.
- BEDC’s Executive Director, once satisfied with the information provided, will approve or refuse the application.
- Upon approval BEDC’s Executive Director issues a Payroll Tax Relief Letter to the attention of the Tax Commissioner for the business and the specified employees of the business. BEDC will provide the approval letter to the applicant and email a copy of the letter to the OTC.
- Once BEDC receives all required information in the completed application, the approval letter can be issued within 8 business days. The letter will only give the tax relief on the employer portion of payroll tax on the remuneration paid to themselves (if owner-managed or self-employed) and any employees for up to 4 tax periods from the commencement of the business.
- Please note that BEDC does not back date relief, so any tax periods, if missed, from when the business officially opened would be excluded.
- Any business that started prior to the commencement date of this programme of April 1st, 2018 will be excluded from obtaining the relief. Any tax periods prior to April 1st, 2018 will also be excluded.
- For the first tax period in which the business receives the relief letter, the applicant must file manually taking the letter to the OTC office.
- Ultimately, it is at the discretion of the BEDC and the OTC, based on the information provided and its own investigations, to determine if the business is eligible to be approved for this relief.
This programme applies to all new startup businesses established in Bermuda after April 1st, 2018. This relief only applies to small businesses as per the definition in the BEDC Act 1980.
The BEDC defines a small business as Bermudian – owned and managed; operating locally; having an annual gross payroll not exceeding $500,000 or having annual sales revenues of less than $1,000,000.
Please ensure that you have reviewed the checklist below and have all the necessary information needed to apply.Complete and compile all information below, BEFORE filling out the application.
