How to file VAT Return under Bahrain VAT

The taxpayer is required to submit details of transactions related to taxable sales and purchases by submitting an electronic VAT Return Form. The submission of the VAT Return Form is commonly referred to as VAT return filing.

The first VAT return in Bahrain is due on 30th April, 2019 for the tax period April to March, 2019. This will be filed by the businesses whose annual supplies are more than 5,000,000 BHD and have registered under Bahrain VAT by 31st December, 2018. Click Here to read more about the VAT return filing Period and VAT return due date.

How to file VAT returns?

The VAT Return Form is an electronic form in which the taxpayer needs to summarize the details of the total output tax due and the total input tax recoverable for a given tax period. All the details need to be filed electronically by logging into the National Bureau for Revenue (NBR).

The following are the steps to file VAT returns in Bahrain.

To file VAT returns in the NBR portal, the taxpayer needs to register with NBR electronically
One login to the NBR portal, the electronic VAT return form can be accessed
The taxpayer needs to manually provide the following details in the VAT return form:
- VAT on sales: In this section, you need to mention the details of sales, output VAT and adjustment, if any. The details of sales need to be categorized into the following:
  - Standard rated sales
  - Sales to registered taxpayers in other GCC states
  - Sales subject to domestic reverse charge mechanism
  - Zero-rated domestic sales
  - Exports and Exempt
- VAT on purchases: Here, you need to furnish the details of purchases and recoverable input VAT. The details of purchases and input VAT needs to be declared in the following manner.
  - Standard rated domestic purchases
  - Imports subject to VAT either paid at customs or deferred
  - Imports subject to VAT accounted for the reverse charge mechanism
  - Purchases subject to domestic reverse charge mechanism
  - Purchases from non-registered suppliers, zero-rated/exempt purchases
- The next step after furnishing the required details is to submit the VAT return
- On submitting the VAT Return form, NBR will send a notification of acknowledgment via email and SMS to the taxpayer. The official detailed receipt (in PDF format) can be accessed on the taxpayer’s portal account with the NBR

VAT return forms can be amended in cases of errors within 30 business days from the date the Taxable Person became aware of the error on his VAT Return Form, and prior to NBR commencing supervision and inspection procedures. To submit an amended VAT Return Form, the same steps as the submission of a VAT Return Form (discussed above) can be used.

Conclusion

The Bahrain VAT return filing requires the details at a summary level meaning the consolidated details of Sales, Purchase/expenses, output VAT, and Input VAT. More importantly, these details need to be furnished in the format prescribed by NBR (check tax invoice format in Bahrain). It will be highly difficult for businesses to manually collate and compile transactions for filing VAT Returns and by doing so, you will be running the risk of missing deadlines and errors which will eventually lead to non-compliance and attract hefty penalties.

Thus, it is a must for businesses to have the right tax accounting software which will not only help you to account for your VAT transactions but also triangulate your business records to generate the accurate VAT Return in the prescribed format.

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