Pension Trust Funds

1.An International Pension Trust Fund providing for retirement allowances for employees, widows, and orphans pensions and for capital payments on death may be established, and may be registered under the Pension Trust Funds Act 1966 on a voluntary basis. A Government tax exemption undertaking may be sought. Prior approval of the Trustees by the Minister of Finance is required, and there are prescribed rules applicable to the establishment of Pension Trust Funds.

Bermuda is frequently used for the establishment of pension and employee benefit plans for employees working outside their home country, or the home country of both the employee and employer ("third-country nationals").

Such a scheme avoids home country regulations (such as ERISA) and allows a single plan to cover employees who move from one country to another. Other advantages include lower costs of administration, wider permissible investments, flexibility in the design of benefits and freedom from withholding taxes.