How to compute the Bahrain VAT payable

The situation

VAT payable is output VAT on sales less recoverable input VAT on purchases for the period.

The law

• Decree-Law No. 48 of 2018 on Value Added Tax: Bahrain VAT law administered by the NBR; covers registration, invoicing, returns and penalties
• Law No. 33 of 2021 amending the VAT law (10% rate): Standard VAT rate is 10% from 1 January 2022

What it means for you

Example: sales BHD 60,000 at 10% = BHD 6,000 output. Purchases with valid tax invoices carry BHD 2,100 VAT. Payable = BHD 3,900. Add reverse charge VAT on imported services as both output and input if fully taxable.

What to do

1. Total standard rated sales.
2. Total valid input VAT.
3. Add reverse charge entries.
4. File and pay the difference.

Related

• Prices must include VAT in Bahrain
• Late VAT return or payment fine
• Monthly or quarterly VAT returns in Bahrain
• How long to keep VAT records
• Input VAT without a valid tax invoice
• Reverse charge on imported services