VATLive > Blog > VAT > Bahrain VAT transition rules - Avalara

Bahrain VAT transition rules

  • VAT
  • 13 October 2018 | Richard Asquith

Bahrain VAT transition rules

Bahrain is to introduce a 5% VAT from 1 January 2019. The following rules will apply to supplies contracted and supplied over the introductory period.

  • Where invoices were issued, or payments made, prior to 1 January 2019 for post-implementation supplies, then VAT is still due. In this case, a debit note for the original invoice should be issued with the correct VAT indicated.
  • Initially, goods supplied to other GCC states that have also implemented VAT (Saudi Arabia and UAE) will be treated as exports. There are plans to introduce zero-rating with reverse charge supplies to eliminate import VAT, but this is dependant on the introduction of a Electronic Services System transaction reporting platform which has yet to be developed.
  • For pre-January 2019 contracts which are silent on the VAT treatment, then the price will be VAT inclusive. This presents a cash flow risk for the supplier.
Latest Bahrani news
Bahrain VAT transition rules
October 13, 2018

Bahrain is to introduce a 5% VAT from 1 January 2019. The following rules will apply to supplies contracted and supplied over the introductory period. Where invoices...
Bahrain 1 Jan 2019 VAT Bill passes
October 7, 2018

Updated 8th Oct: the parliaments, Upper House has passed the Bill tonight. Royal Assent is now a formality within the next week. Bahrain’s parliament lower...
Bahrain to approve VAT launch Nov 2018
September 28, 2018

Bahrain is scheduled to approve the implementation of a 5% VAT in November, in time for an early 2019 launch. The government is looking to...

VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.