Tax Rights
VAT obligations, the absence of income tax, free zone incentives, and tax dispute resolution under Bahrain's National Bureau for Revenue regulations.
VAT Obligations
Bahrain introduced Value Added Tax (VAT) on 1 January 2019, initially at 5%. The rate was increased to 10% on 1 January 2022:Standard rate: 10% on most goods and services.Zero-rated supplies: Certain...
No Personal Income Tax
Bahrain does not levy any personal income tax on individuals:No tax on salaries: Bahraini nationals and expatriates do not pay income tax on wages, salaries, or employment income.No capital gains tax:...
No Corporate Income Tax (General)
Bahrain does not levy corporate income tax on most businesses:No general corporate tax: Companies operating in Bahrain are not subject to corporate income tax on their profits, with one exception.Oil...
Tax Registration and Compliance
The National Bureau for Revenue (NBR) administers tax compliance in Bahrain:Mandatory registration: Businesses exceeding BHD 37,500 in annual taxable supplies must register for VAT within 30 days of e...
Tax Audit Rights
The NBR has the authority to audit businesses, but taxpayers have rights during the process:Advance notice: The NBR typically provides written notice before conducting an audit, specifying the period...
Tax Refund Claims
Businesses that have overpaid VAT or have excess input tax credits can claim refunds from the NBR:Input tax excess: If the VAT you paid on business purchases exceeds the VAT you collected on sales, yo...
Free Zone and Investment Incentives
Bahrain offers several free zones and investment incentives to attract foreign investment:100% foreign ownership: Bahrain allows full foreign ownership of businesses in most sectors without a local pa...
Tax Dispute Resolution
If you disagree with an NBR tax decision, Bahrain provides a structured dispute resolution process:Reconsideration request: You can ask the NBR to reconsider its decision within 30 days of receiving t...