Introduction

Bermuda, located in the Atlantic Ocean between the United States and Europe, less than a two-hour flight from New York and with direct flights to London, has one of the highest GDPs per capita on Earth and is one of the longest-established, high-end private wealth centres worldwide. Many ultra-high net worth individuals have homes on the island or moor their yachts in its beautiful waters.

With decades of prominence in the private wealth sphere, many of the world’s oldest and largest trusts are Bermuda trusts, meaning that the jurisdiction frequently yields internationally important cases, such as, recently, the X Trusts case² on the scope of the protector’s role in private trusts (soon to be heard by the Privy Council) and the Wong case³ which was also referred to the Privy Council and clarified the scope of trustees’ powers under the proper purpose rule.

There are many reasons for the prominence of Bermuda in the trusts sphere. Bermuda is white-listed by the European Union and complies with international regulatory standards on anti-money-laundering, anti-terrorist financing and information exchange under the US Foreign Account Tax Compliance Act (FATCA), the Common Reporting Standard (CRS) and various exchange of information treaties, meaning that doing business with Bermuda entities internationally is generally seamless.

Further, there is no personal income tax, capital gains tax, gift tax, inheritance tax, death tax or wealth tax in Bermuda⁴ making it an excellent base for international structures, since it generally offers tax neutrality.

Additionally, Bermuda has stable institutions, a world-class advisory services industry (due in part to the status of Bermuda as a global hub for the insurance sector) and, as a consequence of decades of serving some of the largest trusts in the world, gold-standard trusts legislation.

With regard to the final point, reassuringly to many, Bermuda trust law is very largely based on English trust law, but with certain enhancements that were advised upon by Bermuda’s leading trust practitioners, often in conjunction with English counsel. Examples of the responsible, commercially minded innovation seen in the Bermuda trust law arena are many, including:

Bermuda being the first jurisdiction to recognise purpose trusts, an important element of many commercial structures, particularly in the insurance industry for which Bermuda is renowned (similar legislation followed suit in many jurisdictions around the world).
Bermuda also being one of the first jurisdictions in the world to disapply the rule against perpetuities, permitting trusts in Bermuda to (generally) endure indefinitely.⁵
When ‘the rule in Hastings Bass‘ was unexpectedly overturned in the English courts, Bermuda acted quickly to enshrine a similar rule in legislation, giving the island’s courts the discretion to set aside certain mistakes made by trustees, including in circumstances where they make decisions in ignorance of negative tax implications. Helpfully, actions implementing such decisions can be unwound in some circumstances, which can be hugely beneficial given that tax mistakes in jurisdictions without equivalent legislation can be catastrophic.
Bermuda has world-leading reserved powers provisions, enabling certain powers to be retained by the settlor or granted to trusted third parties without causing the trust assets to form part of the settlor’s estate or invalidating the trust. These are reinforced by strong firewall laws in case of international attack.
Bermuda also led the way with private trust companies, which are very widely used and have a range of benefits.

Another star of the Bermuda trust offering is section 47 of the Trustee Act 1975. This permits the Bermuda courts to confer on the trustees of Bermuda trusts the power to effect ‘expedient’ transactions which they would not otherwise have the power to effect, which can include the variation of beneficial interests. This legislation is exceptionally helpful where trusts have ceased to be fit-for-purpose but lack appropriate amendment provisions.

Bermuda law also protects Bermuda trusts from foreign-law attacks based on overseas forced heirship laws, communal property laws, bankruptcy/insolvency provisions and divorce laws, offering significant asset protection opportunities. It has a responsible, conservative creditor protector regime.

The final point to note here is that Bermuda is an attractive jurisdiction in which to base a family office due to its safety, high living standards, first-rate infrastructure, established international business community, year-round sunshine and excellent international flight connections. The Bermuda government views Bermuda as an international hub for family offices, and has announced a package of reforms designed to provide a red-carpet, concierge service for their establishment on the island.

Year in review

Corporate income tax

The key development in the past year was the introduction of corporate income tax. In 2021 the OECD agreed on a global minimum tax framework (Pillar II)’ that envisages foreign countries imposing tax in respect of revenue generated by non-resident entities in other jurisdictions in certain circumstances where the effective tax rate payable by the specified group is below 15 per cent.

The OECD rules implementing this plan are known as the Global Anti-Base Erosion Rules (GloBE rules). In light of these rules, it made sense for many jurisdictions like Bermuda, which have historically adopted a policy of imposing light or no taxes on businesses operating there, to adopt new taxes.

Accordingly, like many business-friendly jurisdictions with historically low rates of tax, Bermuda adopted the Corporate Income Tax Act 2023 (CITA). International business on the island was generally in favour of this new tax in light of Pillar II, and its introduction in light of this international development does not represent a switch of policy away from tax neutrality in a more general sense on the part of the Bermuda government.

CITA imposes a new 15 per cent income tax (which will come into effect on 1 January 2025) on certain Bermuda entities that are part of large multinational groups. Its provisions are complex, as most of the scoping provisions mirror the GloBE rules, themselves very technical, to ensure that the new tax is a covered tax under Pillar II.

The headline point for private trust structures in Bermuda is that the vast majority will be clearly outside of the scope of the new tax. The key reason for this is that the new tax does not apply to any structure where the annual revenue in the consolidated financial statements of the ‘ultimate parent entity’⁶ of the structure in at least two of the four fiscal years immediately preceding the fiscal year in question is less than €750 million. Even by Bermuda standards, it is hard to find many private structures that generate that amount of revenue in a single year. For mega-structures, a legal and accounting⁷ analysis will be necessary to determine whether the tax applies and there may well be technical reasons it would not, depending on how they are organised and the circumstances at hand.

When larger new structures are being established, it might make sense to consider whether it makes sense to have different structures for different family members (e.g., three new trusts for three children, instead of one trust for all three) in light of the new tax, and for other important reasons.⁸

Economic Investment Residential Certificate

Bermuda remains committed to attracting high net worth individuals to the jurisdiction. Accordingly, it is constantly refining its Economic Investment Residential Certificate Policy, and has made various changes to this policy over the past year.

Under this policy, a person who makes a BD$2.5 million investment in permitted investments in Bermuda and who fulfils certain other criteria can apply for the right to reside and seek work in Bermuda for an indefinite period.

There is an automatic right to be given a work permit to work for any business in which the person has invested. Further, the successful applicant’s spouse and children (who are either under 18 years of age, or under 25 years of age if in full-time education) can generally reside in Bermuda.

The investment may be made in a range of permitted investments- usually this will be real estate or in the form of investment in Bermuda businesses. The investment must be held for at least five years.

Family offices

As noted above, Bermuda makes an excellent base for family offices and the Bermuda government has announced that it is planning a suite of legislation to facilitate opening new family offices in Bermuda.

Traditionally, when one opens a family office in any jurisdiction, there is a lot of red tape to contend with, for example, work permits for international employees, land licences, and licensing or exemptions from licensing in respect of providing investment advice, fund management services, and corporate service provider/trustee services. The Bermuda government is working on introducing a concierge service to streamline the process, with an application for a single-family office licence being planned. The legislation has not yet been published, but further details of this initiative will be available soon. It promises to be a welcome development to encourage the establishment of family offices on the island in a streamlined, efficient manner.

X Trusts⁹

Of interest also in the past year, leave was granted to appeal the Bermuda Court of Appeal’s decision in the X Trusts case, in which the Court had to decide between the ‘narrow view’ of protector consent powers (which, in summary, holds that the role of the protector is limited to satisfying himself or herself that the trustees’ proposed exercise of the power in question is a proper (i.e., valid and rational) one) and the ‘wide view’ of such powers (which holds that the protector must exercise his or her own independent discretion and may veto a proposed exercise of the trustees’ powers, even if such an exercise would be legally valid and rational).

On the facts in the X Trusts case, the Bermuda Court of Appeal preferred the narrow view, opening up a chasm between the Bermuda approach and the approaches taken by the Royal Court of Jersey¹⁰ and the English High Court¹¹ in certain cases where the wide view was favoured (although in different terms in each case).

Protectors are used very widely in Bermuda trusts, and it will be most interesting to read the Privy Council judgment on this important Bermuda case and to see whether the narrow or the wide view prevails.

In the meantime, the case provides an important reminder when drafting trusts with protectors to consider what the intended scope of the protector’s role is, since the nature of his or her powers can always be delineated expressly.

Upcoming developments – ethical investment

In terms of policy, an interesting development is that legislation on ethical investing looks likely, having been recommended to government by the Bermuda Trust Law Reform Committee.

The Trust Law Reform Committee has proposed amending the Bermuda Trustee Act 1975 to clarify the law and enable trustees to consider settlor and beneficiary views on ethical investments when making investment decisions.

At the current time there is a certain level of uncertainty in most trusts jurisdictions as to the ability of trustees with a general power of investment to exercise investment powers for reasons other than maximum financial return. The proposed new law, if enacted, would provide clarity on this.

It should be noted that it is not being proposed that trustees should be able to bring their own views on ethics to the table, but simply that they should be empowered to consider (as opposed to being bound to follow) wishes on ethical investments expressed by the beneficiaries and/or the settlor.

One still might have difficult practical considerations to balance. For example, family disagreements as to whether funds should be invested ethically at all, and as to which investments are indeed ‘ethical’. Generational differences may emerge here. These issues are no reason to shy away from enabling ethical investment in the right circumstances.

Tax

As noted above, there is no personal income tax, capital gains tax, inheritance tax, death tax, gift tax or wealth tax payable in Bermuda. There are no plans to introduce any of these taxes in Bermuda and no sentiment along those lines has emerged from government.

Stamp duty applies to certain transfers during life or on death, but non-Bermuda property generally escapes this (aside from de minimis amounts). Bermuda also imposes relatively moderate payroll tax, customs duties and land taxes.

As noted above, a 15 per cent corporate income tax will be imposed in Bermuda on certain Bermuda-resident entities which are part of multinational groups which, in at least two of the four fiscal years immediately preceding the fiscal year in question, have annual revenue of at least €750 million. As explained above, this will not impact the vast majority of privately-held structures based in Bermuda.

Succession

General

Bermuda has no forced heirship rules; rather, it allows freedom of testamentary disposition, though certain relatives may apply to the Court for an order under Section 14 of the Succession Act 1974 on the ground that the disposition of the deceased’s estate effected by their will or the law relating to intestacy (or the combination of both) is not such as to make reasonable financial provision for them.

Intestacy

The law of intestacy is governed by the Non-Contentious Probate Rules 1974 and the Succession Act 1974. The Succession Act 1974 provides for the distribution of assets on death when a person has not left a valid will, and for situations of partial intestacy. It establishes who will benefit from the estate of the intestate person, depending on what relatives survive him or her (with priority for any surviving spouse and issue).

Wills

Wills are governed by the Wills Act 1988. The Wills Act 1988 provides that to be valid, a will must be executed by a person of 18 years or above who is of sound mind. To be of sound mind, a person needs to be able to:

identify the persons they should consider when disposing of their estate;
understand the nature of their actions when executing the will; and
understand the extent of their estate.

Subject to Section 8 of the Wills Act 1988, no will is valid unless it is:

in writing, and is entirely in the handwriting of the testator themselves, and signed at the foot or end thereof by the testator (to be proved by the oath of two or more persons well-acquainted with the testator’s handwriting); or
in writing and signed at the foot or end thereof by the testator, or by some other person in their presence and by their direction, and the signature is made or acknowledged by the testator in the presence of two or more witnesses present at the same time and each witness either:
- attests and signs the will; or
- acknowledges their signature in the presence of the testator.

Beneficiaries under wills (and their spouses) should not witness wills as bequests to them in such circumstances would generally be void, although the will itself would not be invalidated by this fact alone.

As in other jurisdictions, under Bermuda law, a will is generally revoked by the testator’s marriage.

In terms of international matters, if there is no Bermuda Will, then a will executed overseas may be enforceable in Bermuda if it meets the formality requirements of the Wills Act 1988 and can be admitted to probate in Bermuda. A foreign grant of probate, letters of administration or letters testamentary issued out of the probate courts of certain jurisdictions including the UK, British dependencies, Commonwealth countries and US states can be resealed in the Supreme Court of Bermuda. This would give the foreign executor or administrator the right to administer property of the deceased situated in Bermuda.

Stamp duty on death

Bermuda does not impose death or inheritance taxes, but stamp duty is payable in respect of Bermuda property in a deceased’s estate. This is calculated by reference to the value of the Bermuda property (other property is exempt).

The applicable rates for deaths on or after 1 April 2023 are shown in the table below.

Estate value	Stamp duty rate
Up to B$100,000	0 per cent
B$100,000 to B$200,000	5.25 per cent
B$200,000 to B$1 million	10.5 per cent
B$1 million to B$2 million	15.75 per cent
Over B$2 million	21 per cent

There are certain exemptions which may apply. For example, stamp duty on the affidavit of value is not paid in respect of bequests to spouses or to registered charities. Neither is it paid on property which has been properly designated as the primary family homestead, or on foreign real and personal property. Therefore, holding foreign currency assets may be preferable where possible from a stamp duty perspective.

Enduring power of attorney

It is possible in Bermuda to execute an enduring power of attorney to cover the situation where a person becomes physically or mentally incapable of managing their affairs. If a person becomes incapacitated and there is no enduring power of attorney in place, the court will need to grant a receivership order in respect of the affairs of the incapacitated person.

Marriage, relationships and children

As regards marriage and relationships, same-sex marriage is not possible in Bermuda, but domestic partnerships are available for same-sex partners under the Domestic Partnerships Act 2018 which confers rights on domestic partners.

Bermuda law does not have a communal or matrimonial property regime. Spousal property may be jointly owned on normal principles. Divorce law in Bermuda is governed by the Matrimonial Causes Act 1974, which is based on the English Matrimonial Causes Act 1973.

There is no legislation in Bermuda on marital agreements (pre-nuptial or post-nuptial) but under common law principles, it is likely that such agreements may be enforced in the right circumstances. Advice should always be taken by both parties prior to entry into such agreements.

Individuals may expressly exclude illegitimate children from the beneficial class of Bermuda trusts if they so desire.

Wealth structuring and regulation

Bermuda has, over the course of more than half a century, established itself as a major player in the global trusts industry with an excellent international reputation and truly vast trusts administered from the jurisdiction.

Bermuda trust law is based on English law and principles of equity, but with important variations designed to make Bermuda an attractive destination for international trusts.

Some highlights of Bermuda trust legislation are set out below.

Expedient transactions (Section 47 of the Trustee Act 1975)

Section 47 of the Trustee Act 1975 applies in circumstances where any ‘transaction affecting or concerning any property vested in trustees’ is thought by the courts to be ‘expedient’ but where trustees do not have the power to affect it themselves. The provision gives the Bermuda Courts the power to confer on the trustees such power as is needed to affect the transaction.

This provision was interpreted widely in GH, IJ v KL & Ors¹² and the many cases on this provision that followed it. The section has been construed as permitting the court (among many other things) to vary beneficial interests without the consent of the beneficiaries (which can be important for reasons of onshore tax). In practice, beneficiaries are generally expected to be consulted about proposed trust amendments.

Section 47 and the wealth of case law on this provision allow trusts to be varied in Bermuda that have ceased to be fit-for-purpose, in cases where (in view of the terms of the trust in question) this would not be possible elsewhere. This flexibility can be incredibly important, and the fact that Bermuda trusts can now endure indefinitely (with the certainty that there will be huge changes in the fund value, the beneficial class, and social norms which might render rigidly drawn trusts no longer suitable for the families they were intended to benefit) makes this even more vital. We have seen a flood of Section 47 applications in our practice over the past year.

Helpfully, the Bermuda court has also been willing to confirm that amendments made to a trust pursuant to section 47 did not amount to a resettlement.¹³

Statutory Hastings Bass rule (Section 47A of the Trustee Act 1975)

Another interesting provision of the Trustee Act 1975 is the new section 47A. This provision effectively re-instates into Bermuda law a rule that is similar to the traditional rule in Hastings Bass.

Section 47A gives the Bermuda courts wide discretion to set aside a fiduciary’s exercise of powers where such exercise was flawed because the fiduciary would not have exercised the power as it did if it had not:

failed to take into account relevant considerations; or
taken into account irrelevant considerations.

This provision can (among other things) effectively unwind decisions made in ignorance of negative tax consequences (in appropriate circumstances). As noted above, making mistakes which lead to negative tax consequences can have catastrophic consequences in other jurisdictions without an equivalent rule in place.

Firewall laws (Section 10 and 11 of the Trusts (Special Provisions) Act 1989)

Section 10 of the Trusts (Special Provisions) Act 1989 excludes the application of certain foreign laws (including forced heirship laws, communal property laws, bankruptcy/insolvency provisions and divorce laws) to Bermuda law-governed trusts. Section 11 of the same Act prohibits the Bermuda courts from giving effect to foreign orders that are inconsistent with Section 10. These two provisions in conjunction provide considerable protection to Bermuda trusts from foreign attack.

Reserved powers (section 2A of the Trusts (Special Provisions) Act 1989)

This provision clarifies that a wide variety of powers over trusts may be reserved to settlors or granted to third parties without impacting the legal validity of the trust, preventing it from taking effect according to its terms, or causing any of the trust property to form part of the settlor’s estate.

The powers that may be reserved to the settlor or granted to third parties include:

the power to revoke the trust in whole or in part;
the power to amend the trust;
the power to advance, appoint, pay, apply, distribute or transfer trust property;
the power to give investment directions;
the power to appoint new trustees/protectors; and
the power to add, remove or exclude beneficiaries.

The legislation clarifies that persons holding the reserved powers listed shall not, by virtue of that fact alone, be deemed to be trustees. There is a presumption (rebuttable by express provision to the contrary) that the reserved powers listed will not be fiduciary if reserved to settlors or granted to beneficiaries (as long as such persons are not the sole trustee) but that they will be fiduciary in other circumstances.

These provisions permit settlors to retain certain controls over Bermuda trusts within an express legislative framework. In practice, the extent of controls retained is a balanced question – the trustees must always have a real role, which requires that they are vested with certain substantial powers. Further, onshore advice will always be relevant when crafting reserved powers trusts, both from the tax perspective, and from the perspective of whether any receiver of the power-holder may be able to step into his or her shoes and exercise powers in respect of the trust – this may require careful thought and potentially bespoke protective drafting.

Purpose trusts (section 12A of the Trusts (Special Provisions) Act 1989)

Section 12A permits trusts to be formed for purposes provided that such purposes are:

sufficiently certain to allow the trust to be carried out;
lawful; and
not contrary to public policy.

Bermuda was the first jurisdiction in the world to permit purpose trusts in such wide terms.

The purpose trust has a wide variety of uses (e.g., orphaning special purpose vehicles, or being a vehicle through which the shares in private trust companies are held).

Perpetuities (the Perpetuities and Accumulations Act 2009)

The Perpetuities and Accumulations Act 2009 came into operation on 1 August 2009, abolishing the rule against perpetuities and excessive accumulations in relation to instruments taking effect on or after that date (except insofar as Bermuda land is concerned). Thus, in Bermuda truly dynastic trusts are possible.

The perpetuity period of older trusts can be disapplied by application to the Bermuda courts under Section 4 of the Act. This jurisdiction was considered in In the Matter of the C Trust¹⁴ where it was held that:

the court should not act as a rubber stamp in relation to such applications;
the court should have regard to the best interests of all interested parties, broadly defined and looked at as a whole; and
the fact that extending the duration of a trust will dilute the economic interests of existing beneficiaries will ordinarily be an irrelevant consideration.

In our experience, for large enough trusts, dynastic intent is easily inferred and it is often seen to be in everyone’s interests to extend the life of the trust to avoid conferring excessive wealth on beneficiaries. Such applications can generally proceed quickly and efficiently and with positive outcome.

Asset protection (Sections 36A-36G of the Conveyancing Act 1983)

In terms of asset protection, Bermuda maintains a balance between the interests of settlors and creditors. Transfers into Bermuda trusts can only be attacked if there is proof, on a balance of probabilities, that when a settlor transferred the assets into trust, the dominant purpose was to put those assets beyond the reach of creditors. Where no obligation was owed at the time of the transfer, the debt must have been reasonably foreseeable. In such circumstances, only transfers below market value can be unwound, and only within a limited period of time. Essentially, a creditor will only be an eligible creditor for these purposes if they are:

a person to whom, on or within two years after the date of the transfer, the transferor owed an obligation that remains unsatisfied on the date of the action or proceeding;
a person to whom, on the date of transfer, the transferor owed a contingent liability that has since arisen and remains unsatisfied; or
a person to whom the transferor owes an obligation in consequence of a claim that they made against the transferor, where the cause of action giving rise to the claim occurred prior to, or within two years of, the transfer.

Such eligible creditors have six years to issue proceedings, with the transaction in question being voidable only if a claim is brought in time.

Common structuring in Bermuda

In Bermuda, the most common structures we see are trusts with either institutional trustees, or trustees which are private trust companies (PTCs) whose shares are owned by institutional trustees acting in capacity as the trustees of a purpose trust – the institutional trustee will then administer the PTC. Trust assets tend to be held via holding companies whose shares are held in trust.

PTCs are exempted from the local licensing requirements which apply to professional trustees pursuant to Section 3 of the Trusts (Regulation of Trust Business) Exemption Order 2002. They are empowered only to provide the services of a trustee to the trusts identified in their memorandum of association.

PTCs aside, professional trustees in Bermuda must generally be licensed (with narrow exceptions).

Structures other than trusts

In terms of other structures seen in the private wealth arena, Bermuda does not yet have a foundations law.

Bermuda has robust company law based on English law. Companies limited by shares or by guarantee are possible, with the latter commonly used in the philanthropic sphere.

Investors may also carry on business in Bermuda by way of a partnership, which may be limited. Partners have the option to elect to give their partnership a legal personality.

To demonstrate how Bermuda lawmakers look to both sides of the Atlantic, the Limited Liability Company Act 2016 draws upon Delaware law, and introduced limited liability companies (LLCs) into Bermuda. These are similar to Delaware LLCs. An LLC has separate legal personality and the liability of its members is usually limited to that of the agreed contributions set out in the LLC agreement.

Regulation of private wealth structures – an overview

Bermuda is white-listed by the European Union.

Bermuda has robust anti-money-laundering (AML) and counter-terrorist financing (CTF) legislation. Various AML offences were created in the Proceeds of Crime Act 1997 (these include concealing or transferring proceeds of criminal conduct, assisting others to do the same, failing to disclose knowledge of money laundering and tipping-off). Requirements to combat terrorism financing are included in the Anti-Terrorism (Financial and Other Measures) Act 2004, which created various offences (including terrorist fundraising, money laundering for terrorist purposes, failure to disclose and tipping-off offences). The Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing) Regulations 2008 and other regulations supplement these requirements. The BMA monitors compliance with these laws and issues regulatory guidance.

Bermuda enacted the International Sanctions Act 2003 and the International Sanctions Regulations 2013, which form the basis of the Bermuda Sanctions Regime. This complies with international norms.

Bermuda has entered into Tax Information Exchange Agreements (TIEAs) with 41 jurisdictions and is a party to four double taxation conventions. Its TIEA responsibilities are governed by the International Cooperation (Tax Information Exchange Agreements) Act 2005. A request for information may be made to the Minister of Finance by a competent authority in another country that has entered a TIEA with Bermuda. The Minister may refuse to accede to a request if:

the requesting party has not exhausted all avenues in its own country to obtain the information;
disclosure is not in the public interest;
the request is too general; or
the request was procedurally flawed.

Information exchanges are subject to confidentiality safeguards.

Bermuda signed an inter-governmental agreement (IGA) in the Model 2 format with the United States pursuant to FATCA. Under this agreement, Bermuda agreed to ensure that financial institutions in Bermuda would collect and report certain information relating to US persons directly to the US tax authorities.

Bermuda also adopted the CRS, the OECD’s global standard for automatic and multilateral exchange of financial information between tax authorities, in 2014. Under CRS, reporting financial institutions must make reports to the Minister of Finance for inter-governmental exchange.

As a result of the above solid regulatory framework, it is easy for Bermuda entities to engage in international transactions.

Outlook and conclusions

Philosophically, Bermuda remains committed to a business-friendly, low-tax environment, though like many jurisdictions it made sense for the island to introduce a covered tax for Pillar II purposes. The new tax will affect very few private family wealth structures. No new income, capital gains, inheritance, death or wealth taxes are proposed in Bermuda, which is very open to private-wealth business, in particular offering an excellent economic investment residency programme and planning an initiative to attract family offices. Trust lawyers in Bermuda and around the world are eagerly awaiting the appeal in the X Trustscase. Bermuda remains one of the best jurisdictions in the world in which to establish a private trust.

Footnotes

¹ Nicola Bruce is a partner in Appleby’s Bermuda office.

² Re the X Trusts[2023] CA (Bda) 4.

³ Private Trust Co Ltd & Anor v Wong & ors [2022] UKPC 47.

⁴ Ad valorem stamp duty may be payable on transfers involving Bermuda property; minimal stamp duty applies in other cases. Moderate payroll taxes, land taxes and customs duties may also be payable. Further, Bermuda entities in certain large groups will be subject to corporate income tax from 1 January 2025, as outlined below.

⁵ The key exception is where Bermuda land is concerned.

⁶ Essentially this is the entity required to consolidate the assets and liabilities of underlying entities in its financial accounts under defined financial standards.

⁷ Accounting input is vital because important elements of the scoping provisions hinge on accounting principles such as whether there is a requirement to consolidate accounts.

⁸ Such as avoiding conflict, and ring-fencing any risks.

⁹ Re the X Trusts [2023] CA (Bda) 4.

¹⁰ See In the Matter of the Piedmont Trust & Riviera Trust [2021] JRC 248.

¹¹ See PTNZ v AS [2020] WTLR 1423.

¹² [2011] SC (Bda) 23 Civ .

¹³ See Butterfield Trust (Bermuda) Limited et al v Matthew Watson (2022) SC (Bda) 92 Civ .

¹⁴ [2016] SC (Bda) 53 Civ .

First published in Lexology In-Depth: Private Wealth and Private Client, September 2024