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Bahrain tax guide 2026

Bahrain tax for companies: 0% today, and the draft that could change it

Updated 10 November 2026Draft status as at November 2026About 9 minutes to read
The short answer

A Bahrain company pays no corporate tax unless it's in oil and gas, and nothing is withheld on dividends.

A draft law would tax profit above BD 200,000 at 10% from 2027, and reach companies with over BD 1 million of revenue. It had not passed by November 2026.

Would the draft reach me? Do I need VAT?
Draft pending 0% Bahrain corporate tax on a company outside oil and gas, November 2026 A draft law would tax profit above BD 200,000 at 10%. It had not passed by November 2026.

Bahrain has no corporate tax outside oil and gas, and that was still true in November 2026. What founders need to know is the draft corporate tax law: 10% above BD 200,000 of profit, with a revenue test that reaches some companies with small profits. Here's its status, who it would reach, and the taxes that apply today, from the National Bureau for Revenue and the draft as reported.

Key takeaways

  • Today only oil and gas companies pay income tax in Bahrain, at 46%.
  • The draft law taxes profit above BD 200,000 at 10%; the first BD 200,000 stays at 0%.
  • It reaches a company with revenue over BD 1 million even if its profit is lower.
  • It had not passed by November 2026; the start date of 1 January 2027 is the government's aim, not law.
  • Groups with EUR 750 million of revenue have paid at least 15% since 2025.
  • VAT is 10%, with registration above BD 37,500 of Bahrain supplies.
Chapter 1

Bahrain corporate tax draft: where it stands

BD 150,000 profit2026
Corporate tax todayBD 0
Under the draft, below BD 200,000BD 0
Withheld on dividendsBD 0
VAT on Bahrain sales10%
Your own country may tax what you take out. Where you live: pick it
  1. 1979Oil and gas onlyDecree-Law 22 (Arabic) taxes oil and gas profits at 46%. Nothing else.
  2. 1 January 2025Minimum tax for large groupsUnder Decree-Law 11 of 2024, groups with EUR 750 million of revenue pay at least 15%.
  3. Late 2025Draft corporate tax announced10% above BD 200,000, with 5% withholding on some payments abroad.
  4. May 2026Questions in parliamentA committee raised a possible constitutional problem.
  5. November 2026Still a draftNo vote, no gazette, no regulations. Aimed at years from 1 January 2027.
1
Key takeaway

0% on the first BD 200,000, 10% above, if and when it passes.

Chapter 2

Would the Bahrain draft tax reach my company?

BD
BD
Part of a group with EUR 750 million of revenue

The calculator uses the draft terms as reported in published tax alerts up to November 2026, and they can change before the law passes. BD 1 is about US$2.66.

2
Key takeaway

Revenue over BD 1 million brings a company in, even at low profit.

Chapter 3

Bahrain domestic minimum top-up tax

A founder's company
A large multinational group
  • EUR 750 million of revenue in two of the last four years
  • Topped up so its Bahrain profit bears at least 15%, from 2025
  • Registers with the National Bureau for Revenue and files yearly
3
Key takeaway

Large groups already pay at least 15% since 2025.

Chapter 4

Bahrain withholding tax on payments abroad

$
The company pays

4
Key takeaway

Nothing withheld today. The draft adds 5% on some fees abroad.

Chapter 5

Bahrain VAT registration: when you need it

BD

Under the VAT Law and its Executive Regulations, as the National Bureau for Revenue sets out, zero-rated exports count toward the threshold. A company with no Bahrain supplies doesn't register.

5
Key takeaway

10% VAT, registration above BD 37,500 of Bahrain supplies.

Chapter 6

Bahrain company filings every year

6 monthsAudited accounts for a WLL through Sijilat, from the second year
BD 50Commercial registration renewal each year; late fees grow monthly
SubstanceRules for companies doing listed activities, not only bank licensees
51Tax treaties in force; a residence certificate needs a legal opinion
6
Key takeaway

Audited accounts within six months, and the CR renewed every year.

Chapter 7

Is Bahrain a tax haven?

Bahrain charges no corporate tax yet, but it has 51 tax treaties, 10% VAT and a minimum tax for large groups. It's on no EU or FATF list as at October 2026, and the OECD rates its information exchange compliant. The draft law would move it further from the label.

7
Key takeaway

On no EU or FATF list; the OECD rates it compliant.

Chapter 8

Bahrain tax questions, answered

?!
Does Bahrain have corporate income tax?
Only for oil and gas, at 46%, under Decree-Law 22 of 1979. A draft law would tax other companies at 10% above BD 200,000 of profit; it had not passed by November 2026.
When would the Bahrain corporate tax start?
The aim is financial years from 1 January 2027, but no date is law until the draft passes and is published.
Would a small Bahrain company pay the new tax?
Not if revenue stays under BD 1 million and profit under BD 200,000. It may still have to register and file nil returns.
Is there withholding tax in Bahrain?
Not today. The draft adds 5% on interest, royalties and some service fees paid abroad; dividends would stay free.
What is the VAT threshold in Bahrain?
BD 37,500 of taxable supplies in 12 months for compulsory registration, BD 18,750 for voluntary, according to the NBR VAT FAQs.
Does Bahrain tax personal income?
No. Employees pay social insurance: 1% for expats and 8% for Bahrainis, with larger employer shares.
Will you track the new law for my company?
Yes. Our Bahrain company includes the commercial address, the yearly renewal and reminders as the rules change. The renewal, audit and owner dates are set out on our Bahrain annual fees and filings page. Opening the company's account is covered in our Bahrain bank account guide.

Changelog

  • 10 November 2026: first published.
  • 13 November 2026: official sources linked in the text.
Your Bahrain company

A Bahrain company, watched as the tax law changes.

BD 1,490 for the first year, then BD 1,090, commercial address included.

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