A comprehensive guide on VAT Payments in Bahrain

Taxable business owners in Bahrain should file VAT returns on a monthly or a quarterly basis, depending on their annual turnover. The total VAT amount payable to the NBR depends on whether the taxpayer’s input tax is enough to offset their output tax. If it is not— if their output tax exceeds their recoverable input tax—then they should pay the difference to the NBR.

• VAT payment deadline
• Criteria for VAT payment
• VAT payment process
• Payment by instalments
• VAT payment methods

VAT payment deadline

Taxpayers should pay the VAT due for each tax period by the last day of the month following the end of the tax period. For example, the VAT payment for the tax period from January 1, 2019 to March 31, 2019 must be made by April 30, 2019.

If the taxpayer has not submitted their VAT return, or if the VAT calculation is incorrect, the taxpayer should pay the VAT amount, the difference in the VAT amount, and the penalties (if any) within a period of 30 days from the date of assessment issued by the NBR.

Criteria for VAT payment

Any taxpayer who issues tax invoices with a VAT amount due should make tax payments to the NBR. The taxpayer must pay VAT to the Bureau irrespective of whether the transaction is taxable, zero-rated or exempted (partially or fully), or incorrectly classified as a taxable transaction.

VAT payment process

The NBR will notify the taxpayer electronically of the total tax payable (this includes the VAT amount, any difference in the VAT amount, and any penalties to be paid). While making tax payments, the taxpayer should provide their TRN (Tax Registration Number) and the corresponding tax period.

Each taxpayer will have an independent online tax account maintained by the NBR in which they can record the following information:

• The VAT amount due for each tax period
• The current balance of the total VAT payable
• The administrative fines to be paid
• Other amounts to be paid

Payment by instalments

A taxpayer can request the NBR to allow them to make VAT payments for a tax period in instalments. The NBR will approve the request if the taxpayer can prove that they will be unable to pay the entire tax amount due in full by the due date. In this case, the taxpayer should submit an application containing the following:

• The VAT amount to be paid
• The corresponding tax period
• The reason for not being able to pay the amount in full

To complete VAT payments in instalments, taxpayers should apply early enough to be notified of the NBR’s decision before the payment deadline. If the taxpayer does not adhere to the payment due dates set by the NBR, the remaining instalments will be due immediately.

VAT payment methods

When a taxpayer’s output VAT exceeds their input VAT, they must pay the excess output VAT amount to the NBR. The VAT payments can be made using the Fataweer service. There are 3 different ways for a taxpayer to make their VAT payment:

• Online and mobile banking: A taxpayer can log in to their online bank portal or mobile banking app to enter the necessary details. If they’re not sure about the VAT amount to be paid, they will have the option to enquire about the total payable amount. Taxpayers can get detailed information on making VAT payments through online banking by contacting their respective banks.

• BenefitPay mobile application:  Taxpayers can download the BenefitPay mobile application to make VAT payments. If they’re not sure about the VAT amount to be paid, they will have the option to enquire about the total amount to be paid. They can also get detailed information on VAT payments from the BenefitPay application, their respective banks, or BenefitPay’s official website. The BenefitPay app is intended only for individuals and not for corporations.

• Bank:  Taxpayers can make their VAT payments at a bank branch. The taxpayer must submit either a standard Fataweer form at the bank branch or a written request signed by an authorised official. Also, taxpayers can get more details about the VAT payment process, the availability and location of the bank branches by contacting their respective bank.