As part of the first phase of VAT registrations, the Ministry of Finance in Bahrain has announced that companies with taxable revenue exceeding BHD5M per annum are required to register by 20th December 2018. The effective date of registration will be 01st January 2019.
It is not clear whether applications received on or after 20th December 2018 will be penalized for late registration. It is recommended, however, to follow the deadlines to avoid any unnecessary complications.
For the purpose of VAT registration, a new government entity has been established with the name of National Bureau for Taxation (NBT). NBT is now accepting applications for VAT registration.
In the second phase of VAT registration, companies with Taxable revenue between BHD500,000 and BHD5 Million will be required to register by 20th June 2019 and the effective registration date will be 01st July 2019.
In the third phase, companies with taxable revenue between BHD37,500 and BHD500,000 will be required to register by 20th December 2019 and the effective date of registration will be 01st January 2020.
As such, persons with taxable revenue above BHD37,500 should prepare themselves from now to avoid any last minute delays. This is because updating Accounting, Financial, Human Resources and internal policies can be a time consuming process in light of the new VAT legislation.
It is expected that more guidance will be announced in the coming days and weeks. The Executive regulations to the VAT Decree Law is expected to be announced by the mid of January which should allow much more clarity.