With effect from April 1, 2019 all foreign currency purchased by a resident of Bermuda from a local bank is subject to a 1.25 per cent tax.
Exemptions from the Foreign Currency Purchase Tax
Transactions by the following bodies are exempt from paying the Foreign Currency Purchase Tax:
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the Government of Bermuda
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the Bermuda Monetary Authority
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the Bermuda Housing Corporation
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any bank
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a deposit company licensed under the Deposit Companies Act - 1974
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a credit union registered under the Credit Unions Act - 1982
- a trust company licensed under the Trust Companies Act - 1991
The following transactions are also exempt from the tax, with permission of the Bermuda Monetary Authority:
- a payment of premium income by a local insurance company or a non-resident insurance undertaking
- a remittance of pension contributions by a local pension fund
Paying Foreign Currency Purchase Tax
Payments are due at the end of each calendar quarter.
Penalties
Any bank that knowingly fails to collect and remit any Foreign Currency Purchase Tax commits will be fined $5,000 or triple the amount of the tax payable (whichever is greater).