Bahrain ey.com/globaltaxguides
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EY Street address:
Mail address: 10th Floor, East Tower P.O. Box 140 Bahrain World Trade Center Manama Manama Bahrain Bahrain
Executive and immigration contacts
Paul Karamanoukian +973 1751-4805
Email: paul.karamanoukian@bh.ey.com
Somaya Abdul Jawad +973 1751-4738 Email: somaya.abduljawad@bh.ey.com
Tomin Jose +973 1751-4851 Email: tomin.j@bh.ey.com
Rashid Anwar +973 1751-4766 Email: rashid.anwar@bh.ey.com
Roman Gusev +973 3365-1121 Email: roman.gusev@bh.ey.com
At the time of writing, the exchange rate between the Bahraini dinar and the US dollar was BHD0.376 = USD1.
A. Income tax
No income taxes are currently imposed on individuals in Bahrain.
B. Other taxes
Except for tax imposed on companies involved in earning income from qualified oil and hydrocarbon activities, Bahrain levies no taxes on corporate income, capital gains, sales, estates, interest, dividends, royalties or fees. No withholding tax is imposed in Bahrain. Value-added tax is imposed at a rate of 10%.
C. Social security
The following social security contributions are payable on basic salary and recurring constant allowances on a monthly basis.
Contribution Rate (%)
For Bahrainis
Social insurance contributions (pension fund)
Employer’s contribution (including insurance against employment injuries) 12 Employee’s contribution 6
Unemployment insurance; paid by employee 1
For expatriates
Insurance against employment injuries
Paid by employer 3 Paid by employee 1
The above rates apply up to an income ceiling of BHD4,000 per month. If the salary exceeds BHD4,000 per month, the actual salary is registered in the Social Insurance Organization of Bahrain (SIO)
records while the contribution is calculated based on a maximum salary amounting to BHD4,000.
The Ministry of Health charges an annual health insurance fee of BHD22.5 for each Bahraini employee. The fee is paid to the Ministry of Health through the SIO. If the employer already pro vides medical or health insurance to employees, the health insurance fee need not be paid. The employer may approach the Ministry of Health and obtain an exemption letter and present it to the SIO.
D. Visas
Nationals of the Gulf Cooperation Council (GCC) member coun tries should not require visas to visit Bahrain except Qatari nationals until further notice.
Business visas. Since 2020, business visas issued online or at the Nationality Passport and Residence Affairs headquarters are valid for up to three months from the time of the issuance of the visas. The visa is valid for multiple entries, one month from the time of the first entry with two weeks of stay to be spent in Bahrain on one visit, which can be extended for another two weeks with a maximum of three extensions allowed.
Visas on arrival. The Bahraini government has recently made changes to the visa on arrival procedures. Effective from 4 September 2020, Bahrain reintroduced visas on arrival across its entry points; nationals of 69 countries are eligible for a visa on arrival in Bahrain. The visa on arrival is extended to nationals of certain European countries as well as to certain South and Central American countries. Visitors from an additional 113 countries may apply for e-visas through a simple online process before traveling. Non-nationals with GCC residency and a designation of manager or above can obtain a visa on arrival at Bahrain Airport.
The cost and duration of visas on arrival and e-visas vary depending on the traveler’s nationality. Since April 2015, visitors apply ing for an e-visa or who obtain a visa on arrival are issued multiple-entry visas typically for a duration of two weeks (renew able up to three months). Certain privileged rules apply to pass port holders from Canada, Ireland, the United Kingdom and the United States.
To avoid inconvenience, it is suggested that visitors always check with the nearest Bahraini embassy or seek professional advice before traveling to Bahrain. To check eligibility and to apply for the above visas, please visit http://www.evisa.gov.bh/.
E. Work and residence permits
To work in Bahrain, all expatriates must have a valid work per mit. To be allotted work visas, an entity that employs expatriates must satisfy the following conditions:
• It must be established in Bahrain.
• It must be registered with the Labor Market Regulatory Authority (LMRA).
• It must have a certain percentage of Bahraini workers (between 5% and 50%, depending on the industry).
The following documents are normally required to apply for a work visa:
• Copy of passport (validity of a minimum of six months)
• Pre-employment medical certificate as per the LMRA guide lines, showing that the employee is fit to work
• Gulf Approved Medical Centers Association (GAMCA)/NonGAMCA form with photo affixed
• Copy of full medical reports
• Signed offer letter or contract written bilingually (English and Arabic)
• Copy of apostilled diploma or qualifications (if the job title requires a pre-approval from the relevant authorities [for exam ple, Council for Regulating the Practice of Engineering Professions])
• Copy of apostilled marriage certificate (if applicable)
• Copy of Bahraini identification card (CPR card), if any
The LMRA can take up to 4 to 5 weeks to process the visa appli cation because of the labor market testing (postponement of 21 days) for an outside applicant application and 2 to 3 weeks for an in-country application. After processing, the LMRA publishes the visa status online. Each applicant is allocated an application identification, and the visa status can be checked online through the LMRA website.
Before the employer proceeds with the visa application, it is suggested that the employee inform the future employer as to whether he or she previously worked in Bahrain. This ensures that he or she is not given a duplicate personal identification card (Smartcard). In addition, the employee should inform the employer as to whether he or she holds a current valid Bahraini visa, such as a multiple re-entry business visa. To avoid the dis ruption of the application process, it is suggested that the prospective employee not enter Bahrain before the visa is finalized.
After the employee enters the country, another medical exam needs to be carried out to confirm that the employee is fit to work. On completing all the above and providing proof of an address in Bahrain, an expatriate employee can obtain the Smartcard.
F. Family and personal considerations
Family members. The employee must obtain the Bahrain work permit (which also serves as the employee’s residence permit) before the employee’s family members can obtain Bahrain resi dence permits.
The following documents and information are required for a fam ily visa (that is, Bahrain residence permit):
• Copy of employee’s passport with valid Bahraini residence permit stamp
• Copy of the identification pages of the family member(s) passport(s)
• Copy of the apostilled marriage certificate for the spouse
• Copy of the apostilled birth certificate for each child (children must be under 18 years of age)
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After the residence permit is issued, each family member must obtain the CPR card.
Each family member must provide the following documents to obtain the CPR card:
• Original passport
• One passport-size photograph with grey background
• Apostilled marriage certificate for spouse and apostilled birth certificate for the children
• Copy of electricity bill or letter from the local area municipal ity confirming the address
Driver’s permits. Bahrain has driver’s license reciprocity with all GCC member countries.
A Bahraini driver’s license can be obtained from the General Directorate of Traffic. In addition, citizens of certain countries can exchange their home countries’ driver’s licenses for Bahrainiissued driver’s licenses without taking the driving evaluation tests.