Allshores has booked a $20.8 million estimated gain through a Bermuda substance-based tax credit.

The company recognised the figure in its income statement as a reduction in net operating costs.

The substance-based tax credits were introduced by the Government last year as part of the corporate income tax regime.

Allshores, the insurer formed through the amalgamation of BF&M and Argus, states in its 2025 annual review that it does not expect to be a payer of CIT in the near term.

Allshores added that “the SBTC provides a credit that may be applied against future corporate income tax liabilities or, where unused, may be refunded in cash. The credit has been recognised as there is reasonable assurance that the Group has complied with the relevant conditions attached to the regime and that the credit will be realised.”

For Allshores, the $20.8 million credit is a significant amount that enabled the company to reduce 2025 operating expenses by 13.8 per cent to a total of $129.4 million.

CIT is levied at 15 per cent on the profits of multinational enterprises with global revenues of at least €750 million (about $872 million). Allshores operates across 18 jurisdictions, including Bermuda, several Caribbean islands, as well as Malta and Gibraltar in Europe. In 2025, the group generated gross written premiums of $653.8 million.

Both the CIT and the tax credits, under the Tax Credits Act 2025, are administered by the Corporate Income Tax Agency.

Cita published a consultation paper on May 13, seeking feedback on amendments to CIT regulations and tax credit regulations. The paper makes clear that the tax credit regulations “will be relevant to all entities intending to claim a tax credit under the TCA, including both corporate income taxpayers and those who are not in scope of the corporate income tax charge”.

While companies who are not liable for any CIT can claim substance-based tax credits, eligibility depends on being a Bermuda constituent entity of an in-scope multinational enterprise, as defined in the Corporate Income Tax Act.

The credits are also initially being targeted at the insurance industry, so the claimant company is required to be regulated under the Insurance Act.

The substance-based tax credits are designed to reward multinational companies that maintain significant economic substance in Bermuda, through employment and on-island spending.

The job-based benefit takes into account employment of Bermudians, headcount and employment growth.

The SBTCs are being phased in through a transitional period. In 2025, 50 per cent of the calculated credit was eligible for recognition, increasing to 75 per cent in 2026, and 100 per cent from 2027 onwards.

In the event that the company claiming credits does not incur any CIT, the credit is paid in cash.

Allshores states: “SBTC credits are first applied to offset any corporate income tax liability (none arose for the Group in the current year).

“Any excess credit is refundable in cash and is expected to be realised within four years. The receivable recognised at year end represents management’s best estimate of the amount recoverable under the regime.”

CG Insurance is another insurer serving the local market that is also part of a group with operations in several countries.

In its latest publicly available annual financial statements, for 2024, CG stated: “Management expects the Company to incur and pay increased taxes in Bermuda beginning in 2025.”

In 2024, CG’s group-wide insurance contract revenue was just over $1 billion.

The Royal Gazette has reached out to Cita and the Ministry of Finance for comment.