When Should You Register for VAT in Bahrain?

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Tally Solutions, Feb-05-2020

Registering under VAT is mandatory when you exceed the turnover threshold limit for registration. We discussed this in our article ‘Who should register under VAT in Bahrain?’. However, this will now be implemented in a phased manner. This means that the window for registration will be different for businesses with different turnover. In this article, let us understand the timelines for registering under VAT and answer some FAQs businesses usually have in this respect.

Timelines for Registering Under Bahrain VAT

The timelines for registering under VAT can be easily understood from the following table:

Turnover

Registration Last Date

Exceeds BHD 5 million (5,000,000)

December 20th ‘18

Exceeds BHD 500 thousand (500,000)

June 20th ‘19

Exceeds BHD 37,500

December 20th ‘19

Timeline for Voluntary Registration Under Bahrain VAT

While the timeline for mandatory registration is phased out for different businesses, voluntary registration is open for all businesses. Businesses whose turnover exceeds BHD 18,750 can voluntarily register at any time.

Now, let us answer some FAQs businesses have with respect to timelines for registering under Bahrain VAT.

FAQs on Timeline for Registering Under VAT

FAQ 1: My business’s turnover is BHD 40,000. When should I register under Bahrain VAT?

Answer: As your business’s turnover exceeds BHD 37,500, you are required to register under Bahrain VAT by December 20th, 2019.

FAQ 2: My business’s turnover is BHD 600,000. When should I register under VAT?

Answer: As your business’s turnover exceeds BHD 500,000, you should register by June 20th, 2019.

FAQ 3: My business’s turnover is BHD 700,000. Do I have to wait to register?

Answer: As your business’s turnover exceeds BHD 500,000, you are required to be registered only by June 20th, 2019. However, you are eligible to voluntarily register, if you wish so. A business whose turnover exceeds BHD 18,750 is eligible for voluntary registration at any time.

FAQ 4: I am a non-resident business in Bahrain. My turnover is BHD 700,000. Should I register by June 20th, 2019?

Answer: Non-resident businesses should register from the date they make taxable supplies in Bahrain, regardless of their turnover.  

Hence, small and medium businesses now have enough time to register under VAT. However, from January 1st, 2019, if you’re making purchases from registered large businesses, you will be paying VAT on purchases. This VAT can be claimed as input VAT deduction only if you’re registered. Hence, it is suggested to evaluate your business expenses and take a call on whether to wait to take a VAT registration or take a voluntary registration.