Bahrain Guide: How to make Payment of Due VAT?

VAT in Bahrain
Payment of Due VAT in Bahrain

After introduction of VAT in Bahrain on 1st January, 2019, when it’s identified that the registered person has made a transaction that is within the scope of supply, Vat calculation of the same has to be made.  The payment of output VAT has to be made to NBR through filing of periodic returns. In this periodic return, the registered person is required to declare the amount of taxable supplies made during the period and output tax liability on the same. Any adjustment in the value of a supply and amount of output tax should also be reported in the periodic tax return. The payment of the final VAT amount also needs to be made through this periodic return.

The declaration and payment requirements above apply to:

  • Any registered person liable to charge Bahrain VAT on his supplies of goods or services.
  • Any registered person making deemed supplies of goods and services in Bahrain.
  • Any registered person purchasing goods or services subject to Bahrain VAT and liable to VAT under the reverse-charge mechanism.

VAT due in case of Imports in Bahrain

VAT due in case of Imports has to be paid by the Importer. The procedure for collection of such VAT is same for Bahrain Custom Affairs as for custom duties and Excise Tax. If the importer is not registered under VAT Law in Bahrain, the agent appointed on behalf of such non-registered person, is liable to the VAT. However, if the importer is registered under VAT law in Bahrain, then he himself will pay the VAT liability.

One thing to remember here is, if the agent appointed on behalf of the unregistered importer pays the VAT liability, he will not be entitled to claim the VAT paid in Bahrain. But, if the importer is registered and pays the VAT, he can claim VAT input of the same.

Special Case

The payment of VAT on Import by a registered importer may be deferred to the submission of the importer’s next tax return. Such registered person who wants to use the deferral must seek authorization from the National Bureau for Revenue.

The NBR may allow the deferral of payment of VAT on import if the following conditions are met:

  • The importer is registered Under VAT in Bahrain
  • The importer undertakes:
    • To maintain, and submit upon request, records and documents for verification of correctness of the calculation of the VAT due.
    • To cooperate and comply with any requests made by the NBR in relation to imports
    • To declare the VAT due on the periodic tax return.

Where the importer has received authorization to defer import VAT, he must provide his VAT Account Number (also referred to as Tax Registration Number (TRN)) to the Bahrain Customs Affairs in order for the goods to be released.

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