Bahrain: VAT implications of commercial register “rental” arrangements

Arrangements may give rise to complex VAT issues and also constitute non-compliance with Bahrain commercial laws.

Commercial register “rental” arrangements

There may be value added tax (VAT) as well as regulatory considerations of commercial register “renting” situations—that is, when the party holding the commercial registration and licenced to operate a business grants a third party the right and licence to operate the business.

Taxpayers engaged in such arrangements may be incorrectly reporting the transactions for Bahrain VAT purposes and may need to make a voluntary disclosure and amend past VAT returns. In addition to VAT, these arrangement also may give rise to regulatory issues and may constitute non-compliance with Bahrain commercial laws and other regulations.

Read a July 2021 report prepared by the KPMG member firm in Bahrain 


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