Is my Bahrain company in DMTT scope
Our parent group is in India with about EUR 900 million revenue. Is our Bahrain WLL covered by DMTT?
The situation
DMTT applies to Bahrain constituent entities of MNE groups with consolidated revenue of EUR 750 million or more in at least two of the four fiscal years before the year tested. It applies to fiscal years starting on or after 1 January 2025.
The law
- Decree-Law No. 11 of 2024 on tax on multinational enterprise groups (DMTT Law): 15% domestic minimum top-up tax for MNE groups with consolidated revenue of EUR 750 million or more in two of the four prior years, from fiscal years starting on or after 1 January 2025
What it means for you
Run the test on the ultimate parent's consolidated accounts, not on the Bahrain entity. Example: group revenue of EUR 820m, 640m, 790m and 700m over four years gives two years at or above EUR 750m, so the group is in scope. Your Bahrain WLL is then a constituent entity even if it is small. Because Bahrain has no general corporate tax today, its effective rate is usually below 15%, so a top-up is likely.
What to do
- Get four years of consolidated revenue from group finance.
- Apply the two of four test.
- List every Bahrain entity and branch.
- Register on the NBR portal if in scope.
Testing only the local company's revenue is the most common scoping error.
We can do this for youDMTT scoping, NBR registration and Revenue Test Notification: BHD 2,500