Executive Regulations of the Value Added Tax Law

The provisions of the Executive Regulations of the Value Added Tax Law issued by Decree-Law No. (48) of the year 2018 accompanying this decision shall apply.

Article 2

All concerned bodies - each in its own capacity - shall implement this decision and the accompanying Regulations, which shall be published in the Official Gazette, and shall take effect from the first of January 2019.

The Minister of Finance and National Economy

Salman Bin Khalifa Al Khalifa

Issue date: 6 Rabi Al-Akhir 1440 H

Executive Regulations of the Value Added Tax Decree-Law No.48 of the year 2018

CHAPTER 1 - PRELIMINARY PROVISIONS

Article 1
Definitions

Words and phrases mentioned in these Regulations shall have the same meanings as mentioned in the Value Added Tax Law issued by Decree-Law No. (48) for the year 2018. The following words and phrases shall have the

Bad Debts	:	the amounts due to a creditor that are unlikely to be paid to him.
Means of Transport	:	any vehicle, ship or aircraft requiring a driver, pilot or crew, depending on the circumstances, which is intended for the transport of at least ten Persons or for carrying Goods on a commercial basis, where its main purpose is to carry out international transport, excluding any Means of Transport converted or used for recreational or personal purposes.
Finance Lease Agreement	:	A contract for the lease of assets under which the lessor transfers substantially all the risks and rewards relating to the ownership of an asset to the lessee.
Operating Lease Agreement	:	A contract for the lease of assets whereby the lessee benefits from the use of the asset for a specified period of time where, at the end of the lease period, the asset is returned to the lessor and the lessee does not bear any risk related to the ownership of the asset.
Telecommunications Services	:	Services relating to the transport, transmission, conversion or reception of signals used for the dissemination of words, images, audio or information by any kind of wire, radio and telephone Services, visual telephone Services, Voice over Internet Protocol (VoIP), voice mail, call waiting and other call management Services, internet access and roaming data, including related transmission Services or granting the right to use the ability to convert, transmit, receive or other similar means.
Electronic Services	:	Services provided over the internet or any electronic platform, and which operate in an automated manner with limited human intervention and which are impossible to complete without the use of information technology.
Healthcare Services	:	All preventative and basic medical Services a patient receives in hospitals, health centres, medical clinics and other medical facilities, but excluding Services provided by these bodies which are of a commercial or investment nature.
Education Services	:	Education Services provided by educational institutions licensed by the Ministry of Education or under its supervision, and which are provided directly to students through kindergartens, pre-primary, primary, secondary and higher education institutions.
Tourist	:	Any natural person who is not a resident of any of the Implementing States, and who is not a crew member of a flight or aircraft leaving the Kingdom.
Law	:	The Value Added Tax Law issued by Decree-Law No. (48) for the year 2018.

CHAPTER 2 - TAX SCOPE AND RATE

Article 2
Price inclusive of Tax

The price displayed for Goods and Services in the local market shall be inclusive of the Tax due.
The displayed price is permitted to be exclusive of Tax due when exporting Goods or Services, provided that the Taxable Person explicitly indicates that the displayed price is exclusive of Tax.

CHAPTER 3 - SUPPLY OF GOODS AND SERVICES

Article 3
Supply of Goods

A transfer of ownership of Goods or of the right to use them as an owner shall include the following:
1. A compulsory transfer of ownership for Consideration, in accordance with a decision issued by public authorities or any law in force in the Kingdom.
2. A Supply of Goods in accordance with a long-term rental agreement or the sale of the Goods through deferred installments, provided that the contract includes the transfer of ownership of the Goods to the Customer under normal circumstances, at the latest, when paying the Consideration in full.
The following Supplies shall be considered as a Supply of Goods:
1. A Supply of water,
2. A Supply of any form of energy, which includes, but is not limited to, electricity and gas, including biogas, coal gas, liquefied petroleum gas, natural gas, oil gas, producer gas, refinery gas, reformed natural gas, and tempered liquefied petroleum gas, and any mixture of gases, whether used for lighting, heating, cooling air conditioning or for any other purpose,
3. A Deemed Supply of Goods.

Article 4
Transfer of Goods to an Implementing State

A Taxable Person must comply with the temporary entry requirements stipulated in the Customs Law for the Cooperation Council for the Arab States of the Gulf, and in particular with the following requirements:
1. Submit a request to Customs Affairs which includes the purpose for the Goods entering under the temporary entry regime and the required period for entry,
2. Provide a financial guarantee or a cash deposit equivalent to the value of the Tax due, in accordance with the temporary entry declaration.
The transfer of Goods that form part of the Taxable Person's assets from the Kingdom to another place within an Implementing State shall not be considered a Supply of Goods, if such Goods form part of another taxable Supply in the Implementing State, provided that such Goods are used to make another taxable Supply within a period not exceeding sixty days from the date of first entry of the Goods into the Implementing State.
The Taxable Person shall maintain documents and records showing the following information:
1. A description of the Goods transferred from the Kingdom to the other Implementing State,
2. The date of transfer of the Goods and the date they were returned to the Kingdom, if applicable,
3. Commercial documents which show the identity of the recipient and the place of receipt of the Goods,
4. Transportation documents which evidence the delivery or receipt of the Goods in the other Implementing State,
5. Documents and details of the Supply of Goods in the other Implementing State, if received.

Article 5
Supply of Services

A Supply of Services shall include but shall not be limited to:

The grant, assignment, cessation or surrender of a right,
Making a facility or advantage available,
Pledging not to undertake a certain activity or allowing a certain activity to be carried out,
Not participating in any activity, or preventing its occurrence, or agreeing to perform any activity,
The transfer of an indivisible share in a Good,
The transfer or licensing of intangible rights, such as rights of authors, investors, artists, rights in trademarks and rights which the laws of the Kingdom deem to be within this category.

Article 6
Supply of multiple components

A Taxable Person shall be obliged, when making a Supply consisting of more than one linked Good or Service for one price, to determine whether the Supply constitutes a single composite Supply or separate multiple Supplies, in accordance with the actual characteristics of such Supply.
A "composite Supply" means any Supply of Goods or Services constituting two or more components in the following cases:
1. Where the Supply includes a principal component and a component or other components necessary or essential for conducting the principal Supply,
2. Where the Supply includes a principal component and a component or other components that are not considered as an aim in themselves, but a means of improving access to the principal Supply,
3. Where the Supply includes two or more closely linked components where they form a single Supply, which would be impossible or unnatural to split.
A single composite Supply may occur in accordance with Paragraph B of this Article when either of the following conditions is met:
1. All components of the Supply are supplied by the Taxable Person.
2. The Taxable Person does not separately determine the price of the components of the Supply, or impose a different price on each component.

Article 7
Supplies made through agents

If a Taxable Person Supplies or receives Goods or Services in his own name on his client's behalf (the undisclosed agent), he shall be treated as having made or received such Supply himself.
If a Taxable Person Supplies Goods or Services in the name and on behalf of his client (the disclosed agent), the Supply shall be considered, for Tax purposes, as occurring between the client and the third party.
A disclosed agent shall evidence his status in accordance with the following:
1. A power of attorney from the client in which he expressly authorises the Agent to act in his name and on his behalf.
2. A contract, invoice, or any other document that clearly shows the Supply was made in the name and on behalf of the client, provided that such document contains the subject of the transaction, the name and address of the client and agent as well as details of the third party.

Article 8
Low value gifts and samples

Supplies of Goods provided without Consideration shall not be treated as Deemed Supplies if the Taxable Person Supplies free gifts or samples, provided that their Market Value does not exceed fifty Dinars exclusive of Tax, per recipient, during a year.
The threshold of annual Supplies of gifts, samples and Goods that a Taxable Person may provide without Consideration in accordance with Paragraph A of this Article is one thousand Dinars during the year.
Samples disposed of without Consideration must be a specimen of a product intended to promote the sale of the product and which allows the characteristics and quality of that product to be assessed without resulting in final consumption, except where the final consumption is essential to the promotion of such product.

Article 9
Exception to Deemed Supplies

A Deemed Supply shall not occur in the following cases:

Where Input Tax on Goods or Services related to Deemed Supplies is not deducted in part or in full.
Where the Supply of Goods or Services is exempt from Tax.

Article 10
Transactions between a head office and its branches

Transactions between head offices and their branches or between the branches themselves shall not be considered as Taxable Supplies as these are regarded as transactions carried out by a single legal Person.

Article 11
Reimbursement of expenses incurred

Reimbursements of expenses incurred by a Taxable Person in his name from another Person shall be Taxable, except where the expenses are directly incurred in the name of the other Person.

Article 12
Surrender of an Economic Activity

The surrender of part or all of the Economic Activity by a Taxable Person shall not be considered as a Taxable Supply where all the following conditions are met:
1. The surrender shall include parts of a business that enable the purchaser to engage in an Economic Activity that was surrendered in full or in part by the seller,
2. The Person surrendering his Economic Activity is registered for Tax purposes in the Kingdom,
3. The purchaser is registered for Tax purposes in the Kingdom or has become obliged to register following the surrender,
4. The purchaser shall immediately upon the surrender process, use the Goods and Services acquired to conduct an Economic Activity.
The parts of a business mentioned in Clause 1 of Paragraph A of this Article include tangible assets such as fixed assets, rights and other intangible assets, as well as liabilities of the business.
Both the seller and the purchaser shall, within thirty days of the date of the surrender, independently notify the Bureau, on a form prepared by the Bureau for this purpose. Where a notification is not formally submitted within the prescribed period, the transfer shall not be considered a surrender and shall be deemed to be a Taxable Supply.

CHAPTER 4 - TAX DUE DATE

Article 13
Date of Supply of Services

Services are considered to have been performed when the agreed work is completed or when the Customer receives and explicitly approves the service or when the Customer issues a certificate of completion.
Any secondary service, provided after the date of carrying out the primary service, shall be considered to be a separate Supply having no effect on the date of completion of the primary service.

Article 14
Date of Supply in special cases

Tax shall be due on Goods deposited and Goods pledged as collateral on the earlier of the following dates:
1. When the bailee or creditor sells them.
2. When the bailee or creditor deducts a cash amount deposited as a bond in order to definitively acquire the Goods.
The date of Supply of Goods deposited with another Person to sell them is the date of Supply of these Goods by that other Person to the Customer.
For imported Goods, the Tax shall be due on the date when customs duty is due according to the Customs Law for the Cooperation Council for the Arab States of the Gulf.
The Tax for Goods supplied on a trial basis shall be due on the earlier of the following dates:
1. When the buyer accepts such Goods on a definitive basis,
2. On the date an invoice is issued.
The Tax due date for the sale of Goods on installments shall be in accordance with the provisions of the Law.
The Tax due date for an Operating Lease Agreement shall be the earlier of the due date or payment date of each installment under the contract.
For Finance Lease Agreements, the Tax is due on the date of the Supply of Goods subject to the contract. Where the contract contains a purchase option exercisable at the end of the contract, Tax will be due on the purchase price. The Tax due for the Supply of Goods with a right of refund shall be on the date when the Supply of Goods was made.
The Tax due for Supplies made in a forcible manner shall be on the date of Supplying the relevant Goods.
Tax shall be due on Deemed Supplies of Goods and Services on the date of Supply, surrender, disposal or change in the use of such Supplies, or on the date of deregistration, on a case-by-case basis.

Article 15
Vouchers

For single-purpose Vouchers which can be exchanged for Goods or Services subject to the same Tax rate, the date of Supply of the Voucher is its issue date. Tax shall be due based on the Consideration paid for the Voucher at the date of Supplying the Voucher.
Tax is due on multi-purpose Vouchers at the date of Supplying the Goods or Services which are exchanged for the Voucher on the basis of the value of the Consideration paid for the Voucher, or the face value of the Voucher where the value of the Goods or Services is not specified.

CHAPTER 5 - PLACE OF SUPPLY

Article 16
Place of Supply of Services related to real estate

For the purposes of applying this Article, "real estate" includes the following examples:
1. Any area of land over which rights, interests or Services can be created.
2. Any building, structure or engineering work permanently attached to the land.
3. Any fixture or equipment which makes up a permanent part of the land or is permanently attached to a building, a structure or engineering works.
A Supply of Services is considered to relate to real estate where the Supply of Services is directly connected with the real estate.
The place of Supply of Services related to real estate shall be where the real estate is located, and such Supplies shall include, but not be limited to, the following:
1. Services by real estate experts or estate agents,
2. Services involving the preparation, coordination and performance of construction, destruction, maintenance, conversion and similar work,
3. Accommodation Services,
4. Services by auctioneers, architects, surveyors, engineers and others involved in matters relating to real estate.

Article 17
Place of Supply of Telecommunications Services

The place of Supply of Telecommunications Services shall be determined in accordance with the following:
1. The place of use and enjoyment of the Service, where the Customer is an unregistered Person for Tax purposes, regardless of the place of the contract or the place of payment of the Consideration.
2. In the Kingdom, if the use or enjoyment of the Service is in the Kingdom, within the limits of such use and enjoyment.
3. In the Place of Residence of the Customer where that Customer is a Taxable Person.
The place of use of Telecommunications Services shall be determined according to the following principles:
1. In the case of a Supply of Telecommunications Services through fixed locations for receiving fixed or public telephone Services, or internet (Wi-Fi) Services, the place of use and enjoyment of the Services by the Customer shall be that fixed location.
2. If the Services are provided through mobile networks, the place of use and enjoyment of the Services shall be determined by the country code of the mobile chip (SIM card) used to receive the service.
3. If the Services relate to international roaming, the place of use and enjoyment of the Services shall be the country where the mobile network used for roaming is located.
If a Supplier Supplies Telecommunications Services to a Customer for the purpose of re-supplying such Services to another Customer, the place of use and enjoyment of each of these Supplies shall be determined separately.

Article 18
Place of Supply of Electronic Services

Electronic Services shall include, but not be limited to, the following:
1. Services that provide or support an electronic network, including a website or web page on the internet.
2. Digital products, including computer programmes and any changes or updates to software programmes.
3. Services automatically generated by a computer over the internet or an electronic network, as a response to specific data inputs by the receiver.
4. Internet Services software for information that allows the communications component to provide an assisting element, for example components that allow access to news, weather or travel reports, web hosting, online discussion and others.
5. Supply of a website domain, web hosting and remote maintenance of software and equipment.
6. Supply of visual content such as images or texts that are automatically supplied, screensavers, electronic books and other documents and digital files.
7. Supply of music, films, television series, games, magazines, newspapers, or other programmes upon demand.
8. Provision of advertising on websites and advertising space on websites and any rights associated with such advertising.
9. Provision of online Educational Services.
10. Supply of computer programmes and updates.
Where the Customer is not a Taxable Person, the place of Supply of Electronic Services shall be the place where the Services are used and enjoyed.
The place of Supply of Electronic Services provided to a taxable Customer shall be the Place of Residence of the Customer. For the purposes of determining the Place of Residence of the Customer, the Supplier may refer to the following:
1. The Customer's address as stated on the Tax Invoice or other documents used for billing,
2. Details of the Customer's bank account,
3. The Internet Protocol address of the Customer used to receive Telecommunications Services and Electronic Services,
4. The country code of the SIM card used by a Customer to receive Telecommunications Services and Electronic Services,
5. Other information of a commercial nature.
The place of use and enjoyment of the Electronic Service shall be determined on the date of Supply and any subsequent changes to the use of the Service received shall not affect the place of Supply.

Article 19
Place of Supply of transport of Goods and passenger Services

The place of Supply of transport Services for Goods, passengers and associated or related Services shall be determined in accordance with the following:

The place of Supply of transport Services for Goods or passengers shall be the place where the transport starts, even if the transport includes more than one stop during a single journey.
The place of Supply of Services related to transport shall be the place of Supply of the transport service to which it relates.

Article 20
Place of Supply for Intra-GCC Supplies

A Taxable Person who makes Intra-GCC Supplies shall retain evidence of the transfer of Goods and their arrival in the Implementing State where the transfer or delivery ends. Where no evidence of the completion of the transfer is provided by the Taxable Person within sixty days of the date of the Supply, the provisions of Clause 2 of Paragraph A of Article 14 of the Law shall apply.
Any of the following shall be considered as evidence of the transfer of Goods to the Implementing State where the transfer or delivery ends:
1. Commercial documents indicating the identity of the Customer and the place and date of delivery of the Goods,
2. Transportation documents evidencing the delivery or receipt of Goods in the Implementing State where the transfer ends,
3. A customs declaration.

CHAPTER 6 - IMPORTS

Article 21
General provisions for Import of Goods

Goods shall not be considered as Goods imported into the Kingdom in the following cases:
1. Where these Goods are under a Tax customs duty suspension regime in accordance with the Customs Law for the Cooperation Council for the Arab States of the Gulf, provided that a financial guarantee or cash deposit equivalent to the value of Tax due has been provided in the following cases:
  1. Goods placed in a customs warehouse
  2. Temporary importation
  3. Goods in transit
  4. Imported Goods for the purpose of re-exporting by the same Person.
2. The financial guarantee referred to in Clause 1 of this Article shall have the following requirements:
  1. Its value shall be equivalent to the value of Tax due.
  2. It shall be issued by a bank licensed by the Central Bank of Bahrain either in the form of an unconditional or unrestricted letter of guarantee or as a payable and certified cheque.
  3. It shall be valid for the entire period during which the Goods are placed under one of the customs duty suspension regimes.
  4. The Importer shall renew it at the end of its validity period if the Goods have not been released from the customs duty suspension regime.
Where a Person imports Goods into the Kingdom through another Implementing State, Tax will not be due at import, if it is evident that the Tax due has been paid in that other Implementing State. The Importer shall declare to the Bureau the value of the Tax paid in the other Implementing State and submit documents evidencing such payment.

Article 22
Deferral of Tax payment on Import

The Bureau may allow the deferral of payment of Tax on import subject to meeting the following conditions:
1. The Importer is registered for Tax purposes.
2. The Taxable Person is bound by Customs Affairs records at the Ministry of Interior.
A Taxable Person authorised to defer payment of Tax on import shall adhere to the following:
1. He shall maintain records and documents which enable the Bureau to verify the import procedures and the correctness of the calculation of the Tax due, provided they are submitted to either the Bureau or Customs Affairs upon request.
2. He shall cooperate and comply with any requests made by the Bureau in relation to the imports.
3. He shall declare the Tax due on the Tax Return relating to the Tax Period during which the import of Goods occurred.

Article 23
Imports through a registered agent

If a Person who is unregistered for Tax in the Kingdom imports Goods via an agent who is registered for Tax acting on his behalf for the purpose of importing Goods into the Kingdom, the agent shall be obliged to pay the Tax due on Import prior to the release of such Goods.
Tax shall not be due on the recharge of the Tax paid by an agent to his Customer in accordance with Paragraph A of this Article. Further, an agent shall not recover this Tax because the agent paid the Tax on behalf of the Customer.

CHAPTER 7 - VALUE OF SUPPLY

Article 24
Value of Supply of Goods and Services

Consideration shall not include amounts paid to the Taxable Person by the Customer as a deposit, if the following conditions are met:
1. Such amounts are refundable in nature.
2. They do not represent a payment on account.
The Market Value shall be determined in accordance with the fair price tradeable in the market between two independent parties under similar circumstances at the same date as the date of the Supply and in accordance with the following free competition conditions:
1. Neither the Supplier nor the Customer is subject to any kind of commercial pressure;
2. Both the Supplier and the Customer independently work to achieve what is in their best interest;
3. The transaction is made within a reasonable period of time.
Where the Market Value can not be determined in accordance with Paragraph B of this Article, the Bureau shall determine the Market Value in accordance with the mechanism it adopts.

Article 25
Special cases for setting the value of Supply

For the purposes of applying the provisions of Article 6 of the Regulations, the Taxable Person shall, if different components of the Supply are subject to different Tax treatments, allocate the price in order to apply the Tax due on each Good or Service according to their Tax treatment. Otherwise, the highest Tax rate shall be imposed on the total value.
Where Goods and Services which are deposited or pledged as collateral are supplied by the bailee or the pledgee, Tax shall be imposed on these Goods and Services based on the value of the Supply.
Where the value of a Supply of Goods or Services between independent Persons is not specified on the date of Supply due to elements still unknown in accordance with the agreement between these Persons, the Tax shall be calculated based on the expected value of the Supply, provided that the Tax due is adjusted when the value of the Supply is finally agreed.

Article 26
Value of imported Goods

The value of Goods imported after having being placed in one of the customs duty suspension regimes shall be determined based on their value according to their state when they are released from the customs suspension regime, including the value of the Services performed on the Goods, in addition to the value of all the elements included in determining the value of Goods when imported.

Article 27
Value of Supply between Related Persons

Tax shall be calculated for Supplies between Related Persons on the basis of Market Value where both of the following apply:
1. If the value of the Supply is lower than the Market Value.
2. If the Customer is not entitled to deduct the Input Tax in full.
The Bureau shall be entitled to request evidence from any of the Related Persons to ensure that the calculation of Tax has been based on the Market Value of the Goods and Services.
If the evidence referred to in the preceding paragraph is not provided to the Bureau within thirty days from the date of its request, or if the Bureau finds that the Related Persons used a value lower than the Market Value, then the Bureau shall have the right to replace the value used with the Market Value and shall calculate the Tax on this basis.

Article 28
Value of Deemed Supply

For a Deemed Supply of Goods, the purchase price shall be the basis for imposing the Tax. If the purchase price is not known, the total actual cost as at the date of the Supply shall be used.
For a Deemed Supply of Services, the total actual cost incurred by the Taxable Person shall be used as the basis for imposing Tax on the provision of such Services.
Where the purchase price or the total actual cost as stipulated in Paragraphs A and B of this Article cannot be determined, Tax will be imposed on the basis of the fair Market Value of the Goods or Services.
The value of a Deemed Supply where the Economic Activity ceases shall be the fair Market Value of the Goods held by the Taxable Person at the date of his deregistration.

Article 29
Value of Supply after discount

Discounts provided at the time of Supply shall be treated in accordance with Clause 1 of the first paragraph of Article 24 of the Law.
Discounts provided after the Supply shall be treated in accordance with the provisions of Article 28 of the Law.
For the purposes of applying Clause 2 of the first paragraph of Article 24 of the Law, State subsidies shall include subsidies granted by Government Bodies.

Article 30
Bad Debts

If the Consideration for a Supply is not paid in part or in full, the Tax amount may be adjusted in accordance with the following conditions:
1. The Taxable Person shall prove that he has taken all necessary measures to collect the debt.
2. The debt must be written off in the records of the Taxable Person as a Bad Debt, in whole or in part.
3. The debt must not have been collected for a period of twelve months or more, with the exception of non-payment due to bankruptcy.
The Customer shall reduce the recoverable Input Tax in the Tax Period in which the Tax was adjusted in respect of the Taxable Person's Bad Debt in accordance with Paragraph A of this Article.
Where the debt is collected in whole or in part at a later date, the Net Tax shall be adjusted within the Tax Period during which during which the debt is collected.

Article 31
Value of Supply based on profit margin scheme

A Taxable Person may, subject to the Bureau's approval, account for Tax based on the profit margin scheme in respect of the Supply of the following Goods:
1. Used moveable Goods, in the Kingdom, which are suitable for further use in their current state or after repair.
2. Works of art, artifacts or other items of scientific, historical or archaeological interest.
The provisions of Paragraph A of this Article shall apply provided that the Taxable Person makes a Supply of the above mentioned Goods following their purchase from the following:
1. A Person not registered for Tax purposes in the Kingdom; or
2. A Taxable Person who is authorised to calculate Tax based on the profit margin; or
3. A Taxable Person who purchased Goods for business purposes, but was not entitled to refund Input Tax in respect of those Goods.
The profit margin consists of the difference between the selling price and the purchase price of the Good, and is considered to be inclusive of Tax.
The Taxable Person shall not deduct any Input Tax imposed on him or included in the value of the acquired used Goods.
The Taxable Person shall clearly indicate on the Tax Invoices he issues that Tax has been calculated based on the profit margin.
The Taxable Person shall keep records and documents showing details of Taxable Supplies made on the basis of the profit margin.

Article 32
Adjustment to the Value of a Supply

The Taxable Person shall issue the necessary correction documents stipulated in Article 41 of the Law and deliver them to the Customer in any of the cases mentioned in Article 28 of the Law.
The Taxable Person shall adjust the Tax due for the Tax Period during which any of the cases stipulated in Article 28 of the Law occur.
If the conditions relating to Bad Debts are met, the Taxable Person may adjust the Tax due in accordance with Article 28 of the Law.

CHAPTER 8 - REGISTRATION

Article 33
Mandatory registration

The Mandatory Registration Threshold shall be thirty seven thousand five hundred Dinars.
A Person required to register for Tax purposes shall apply for registration to the Bureau in accordance with the following deadlines:
1. Thirty days from the last day of the month during which the value of his annual Supplies in the Kingdom exceeds the Mandatory Registration Threshold.
2. Thirty days prior to the month during which the value of his annual Supplies in the Kingdom is expected to exceed the Mandatory Registration Threshold.
Registration shall take effect from the date specified on the registration certificate.
The Bureau shall automatically register the Taxable Person from the date his Supplies reached the Mandatory Registration Threshold if he fails to submit the application for registration within the deadlines specified in this Article. The registration provisions shall apply from such date and the Bureau shall notify him of his registration.
The Taxable Person shall be responsible for the Tax due on all Taxable Supplies and Imports effected prior to the date of registration where the registration was delayed in accordance with the provisions of this Article.

Article 34
Annual Supplies for VAT registration purposes

The value of annual Supplies must include, for the purposes of registration, the following:
1. The value of Taxable Supplies of Goods and Services, with the exception of the value of Capital Assets.
2. The value of Deemed Supplies.
3. The value of Intra-GCC Supplies which would have been taxable if made in the Kingdom.
4. The value of annual Supplies made by Related Parties, where the conditions as set out in Article 40 of these Regulations are met.
5. The value of Goods and Services supplied to the Taxable Person who is liable to pay the Tax due.
The provisions of Paragraph A of this Article shall apply to determine the value of the expected annual Supplies. The value of the expected annual Supplies shall be based on a clear business plan prepared by the Taxable Person, and should not be expected to be subject to a change which may affect realising the expected Supplies.

Article 35
Registration exceptions

The Taxable Person who intends to be excepted from registration shall apply to the Bureau for a registration exception, based on a form prepared for this purpose, and shall include the following information:
1. His name, information and address of his Place of Business in the Kingdom.
2. His commercial registration number.
3. His Tax registration number and any customs records, if applicable.
4. The type and description of the Economic Activity conducted by the Taxable Person, which shows that the Supplies made are subject to Tax at the zero rate.
5. The value of the actual and expected annual Taxable Supplies at the zero rate.
6. A pledge by the Taxable Person not to deduct Input Tax or claim any Tax refund during the period in which he is exempt from registration, if he is registered for Tax purposes at a later date.
The Bureau shall process the application for registration exception within thirty days from the date of submission of the application, and the Taxable Person shall submit any necessary clarifications and related documents to the Bureau upon their request.
The Bureau shall review the application to ensure that the conditions for exemption from registration are met and shall notify the Taxable Person of the acceptance or rejection of the application following its review.
Where a Taxable Person who is excepted from registration makes Supplies other than zero rated Supplies, he shall notify the Bureau within a period not exceeding thirty days from the commencement of such Supplies.
A Taxable Person who is excepted from registration and who no longer fulfils some or all of the conditions stipulated in this Article shall register for Tax purposes within thirty days from the date the exception from registration no longer applies.

Article 36
Mandatory registration for non-resident Person

A Non-Resident Person who is not registered with the Bureau, and who is obliged to pay Tax in the Kingdom, shall apply to the Bureau for registration within thirty days from the first Supply on which that Person was obligated to pay Tax, either directly or, following the approval of the Bureau, by appointing a Tax Representative who conducts all obligations stipulated in the Law and these Regulations.

Article 37
Registration application

The registration application shall include, at a minimum, the following information:
1. The name and address of the applicant.
2. The email address to be used for correspondence with the Bureau.
3. The commercial registration number and the customs registration number, if applicable.
4. Details regarding the applicant's Economic Activities.
5. The date of commencing the activity and the date of meeting the conditions for mandatory registration.
6. Value of actual and expected annual Supplies for registration purposes.
7. Reference to the nature of the Supplies made and whether they are exempt from Tax or subject to the zero rate.
8. Reference as to whether the applicant is an exporter, showing the ratio of annual exports to total annual Supplies.
9. Details of authorised signatories of the Taxable Person for Tax purposes.
Where the application has been accepted, the Bureau shall issue a registration certificate to the Taxable Person which shall include the effective date of registration together with the Tax Registration Number. In the event the registration certificate is lost or damaged, the Taxable Person shall obtain another registration certificate.
The Taxable Person shall place the registration certificate issued by the Bureau in a visible place in his establishment.

Article 38
Tax Group

The Bureau may register two or more legal Taxable Persons that are resident in the Kingdom, as one Tax Group, on their request and after meeting the following conditions:
1. All Persons shall be related.
2. All Persons shall be registered for Tax purposes at the date of applying for registration as a Tax Group.
A Person shall not be a member of more than one Tax Group in the Kingdom.
Each member of the Tax Group shall be jointly liable for the Tax due by the group, as well as for the Tax obligations arising during his Tax Group membership.
Transactions undertaken between members of the same Tax Group shall not be considered Supplies for Tax purposes.
Members of the Tax Group shall not withdraw from the group before a period of at least twelve months has passed from the date of joining the Tax Group.

Article 39
Tax Group representative

The Tax Group shall, by a power of attorney, appoint one of its members as a representative of the Tax Group.
The Tax Group representative shall comply with all Tax obligations of the group without prejudice to the joint liability of the members of the Tax Group, including the following:
1. Submit an application to form a Tax Group in accordance with the form prepared for this purpose by the Bureau.
2. Notify the Bureau of a request to withdraw any member of the Tax Group or add new members to it.
3. Notify the Bureau of a request to disband the Tax Group for any reason, or where the conditions to register as a Tax Group no longer exist.

Article 40
Registration of Related Persons

The value of the annual Supplies made by each Related Person shall be added to determine the total value of the annual Supplies for registration purposes in the Kingdom.
Related Persons must have financial, economic and regulatory ties.
If the total value of annual Supplies exceeds the Mandatory Registration Threshold, each of the Related Persons concerned shall apply individually to the Bureau for registration and the Bureau may register such Persons with immediate effect, when it is proven that they segregated their business to avoid registration for Tax.

Article 41
Obligations when withdrawing from a Tax Group

Any adjustment relating to a Supply, receipt or import made by any member of the group while still a member of the Tax Group shall be considered as an adjustment made by the Taxable Person and not from the Tax Group, provided that the adjustment is not related to transactions between members of the Tax Group.
The value of the adjustment of Capital Assets acquired by a member during his term as a group member shall be considered as an adjustment made by him rather than by the Tax Group.

Article 42
Tax Group registration requirements

The Tax Group representative shall apply for the registration of the Tax Group based on a form prepared by the Bureau for this purpose.
The Tax Group registration application must include, at a minimum, the following information:
1. Name and Registration Number of the Tax Group representative.
2. Name and Registration Number of every member of the Tax Group.
3. Details of how each member of the Tax Group is related by way of financial, economic or regulatory relationship.
4. Power of attorney issued by the members of the Tax Group to appoint a Tax Group representative.
5. Written consent from the Person appointed as the Tax Group representative consenting to represent the Tax Group.
The Tax Group representative shall provide the Bureau with any documents supporting the validity of the information in the application within thirty days from the date of request.
The Bureau shall approve or reject the application for registration of the Tax Group within thirty days from the date of submission of the application and shall notify the Tax Group accordingly.
A Tax Group registration application shall be rejected by the Bureau if any of the following apply:
1. Where information in the application is found to be incorrect or if one of the Tax Group registration requirements is not met in accordance with the provisions of the Law.
2. If it is found that there are valid reasons that registering as a Tax Group may pose a risk to Tax revenues.
3. If one of the members of the Tax Group is a Government Body.
Where the application for registration of a Tax Group is approved, a new Tax Registration Number and a new registration certificate for the Tax Group shall be issued, which will specify the effective date of registration of the Tax Group.

Article 43
Amendment of registration information

The Taxable Person shall notify the Bureau, on a form prepared by the Bureau for such purpose, of any change to his information, transactions or activities in the Kingdom, or any other material information mentioned in the registration application within thirty days from the date of its occurrence.

Article 44
Voluntary registration

The Voluntary Registration Threshold shall be eighteen thousand seven hundred and fifty Dinars.
The application for voluntary registration shall be submitted by a Person not obliged to register to the Bureau on a form prepared for this purpose. The Bureau shall review and examine the application and, within sixty days from the date the application was submitted, notify the applicant of the results of the examination as to whether the application has been accepted or rejected.
The voluntary registrant must remain registered for a period of not less than twenty-four months from the date of registration, unless he completely ceases carrying out his activities prior to that date. In such case, he shall be obliged to prove, with sufficient evidence, to the Bureau that he has ceased his activities.

Article 45
Deregistration

A Person obliged to deregister where one of the cases for deregistration has been met, shall submit a deregistration application, on a form prepared by the Bureau for this purpose, within thirty days from the date when the circumstances which oblige him to deregister occur.
The Bureau may request the Taxable Person to provide documentation which proves that he has ceased his Economic Activity or to provide proof of the value of his annual Supplies or his expected annual Supplies, or any other documentation it considers necessary to issue a decision on the application for deregistration.

Article 46
Deregistration application

The deregistration application must include, at a minimum, the following information:

The name of the registrant applying for deregistration.
The Registration Number of the registrant and the effective date of deregistration.
The reason for applying for deregistration.
The date the registrant ceased making Taxable Supplies, if the reason for deregistration is the cessation of his Economic Activity.
The value of annual Taxable Supplies during the previous twenty four months.
The value of the expected Taxable Supplies for the next twelve months.

Article 47
Processing the Deregistration application

The Bureau shall process the deregistration application within thirty days from the date of its submission and shall notify the applicant of its decision to approve or reject the application.
If the application to deregister is approved, the Bureau shall notify the registrant of the deregistration and shall not issue such notification until after the registered Taxable Person has:
1. Paid Tax and fines due by him.
2. Submitted all Tax Returns he was obliged to submit for the periods when he was subject to Tax.
The Bureau shall set the effective date for Tax deregistration in the deregistration decision.
In all cases, the deregistered Person must adhere to the following:
1. Refrain from presenting himself as a registrant under any circumstances.
2. Maintain books, records, and invoices related to his Supplies for a period of five years from the date of his deregistration and allow the Bureau's employees to review them upon their request.

Chapter 9 - Tax Period and Tax Return

Article 48
Tax Period

The Tax Periods shall be as follows:
1. One calendar month for a Taxable Person the value of whose annual Supplies declared for Tax registration purposes exceeds three million Bahraini Dinars.
2. On a quarterly basis for a Taxable Person the value of whose annual Supplies declared for Tax registration purposes does not exceed three million Bahraini Dinars, and shall be in accordance with the following periods:
  1. First Tax Period: 1 January to 31 March,
  2. Second Tax Period: 1 April to 30 June,
  3. Third Tax Period: 1 July to 30 September,
  4. Fourth Tax Period: 1 October to 31 December.
Notwithstanding the provisions of Paragraph A of this Article, the Bureau may adjust the Tax Period of a Taxable Person for reasons that they determine. The Bureau shall notify the Taxable Person of the new Tax Period no later than three months prior to the effective date of the new period.
The Taxable Person the value of whose annual Supplies does not exceed three million Bahraini Dinars may submit a request to change the Tax Period to be on a monthly basis. If the Bureau agrees to change the Tax Period, then a notice of such change shall be issued indicating the effective date of the new Tax Period of the applicant.

Article 49
Submitting a Tax Return

A Taxable Person shall submit to the Bureau a Tax Return for each Tax Period no later than the last day of the month following the end of the Tax Period.
A Taxable Person shall declare, at a minimum, the following information in his Tax Return:
1. The value of his standard rated Taxable Supplies and the amount of Tax due by him relating to the Tax Period for which the Tax Return is submitted.
2. The value of his zero rated Taxable Supplies relating to the Tax Period for which the Tax Return is submitted.
3. The value of Goods and Services supplied to the Taxable Person for which he is liable to pay Tax, and the corresponding amount of Tax due and related to the Tax Period for which the Tax Return is submitted.
4. The amount of Tax due on import for which payment has been deferred related to the Tax Period in which the Tax Return is submitted.
5. The value of additional Tax due as a result of adjustment.
6. The total value of Tax due for the Tax Period.
7. The total value of inputs of the Taxable Person and the total value of deductible Tax from such inputs related to the Tax Period for which the Tax Return is submitted.
8. The amount of the net refundable Tax from previous periods.
9. The amount of deductible Tax on imports.
10. The value of any excess Tax recovered resulting from an adjustment related to a discount.
11. The total amount of deductible Tax related to the Tax Period for which the Tax Return is submitted.
12. The amount of Net Tax due or refundable.

Article 50
Procedures for submitting a Tax Return

A Taxable Person shall submit the Tax Return to the Bureau in electronic form according to the mechanism prepared for this purpose.
The Bureau shall provide the Taxable Person with personal data that authorises him to access his personal online account, and he shall retain such data, and no third party shall be permitted to obtain or use it.
On receipt of a Tax Return, the Bureau will send a receipt to the Taxable Person through electronic mail.
The receipt of an electronic Tax Return shall be regarded as an official receipt of the Tax Return, and the submission date of the Tax Return through the Bureau's website shall be the actual date of submission of the Tax Return.
Submitting the Tax Return through the Bureau's website will be regarded as an approval and acknowledgement by the Taxable Person of the validity of the data contained in the Tax Return and issued on his behalf.

Article 51
Amendment of the Tax Return

Where an error is found in the Tax Return, resulting in a reduction or increase in the amount of the Net Tax, the Taxable Person shall, using the same mechanism for submitting a Tax Return, submit an amended Tax Return on a form prepared for this purpose by the Bureau.
The amended Tax Return shall include, in addition to the information contained in the original Tax Return, a description of the amended amounts, the original amounts, the differences as a result and the reason for the adjustment.
An amended Tax Return must be submitted within thirty days from the date the Taxable Person became aware of the error in his Tax Return and prior to the Bureau commencing supervision and inspection procedures.
The amended Tax Return shall rescind the original Tax Return and shall be a substitute to it.
Administrative fines shall not be imposed on a Taxable Person upon submission of an amended Tax Return where the amended Tax Return was submitted within the period prescribed in this Article.
Notwithstanding the provision of Paragraph A of this Article, a Taxable Person may correct any error resulting in Net Tax due of less than five thousand Dinars through its Tax Return for the Tax Period following the original Tax Period.

Chapter 10 - Tax Invoice and similar documents

Article 52
Tax Invoice

A Tax Invoice must contain at least the following:
1. The words "Tax Invoice" clearly stated.
2. The name, address of the Taxable Person and his Registration Number.
3. The name and address of the Customer.
4. The date of issue of the Tax Invoice and the date of Supply or date of payment if these differ from the date of issue.
5. A sequential invoice number.
6. A description of the Goods or Services supplied.
7. The quantity of Goods supplied.
8. The value of the Supply in Dinars, with the unit price exclusive of Tax in Dinars.
9. The value of discount, if any, and the net value of the Supply in Dinars.
10. The rate and amount of Tax applicable.
11. The total amount due on the Supply inclusive of Tax in Dinars.
12. The exchange rate applied where a currency other than the Dinar is used.
13. An explicit reference where Tax has been calculated based on the profit margin mechanism.
14. An explicit reference where the transaction has been exempted from Tax.
A Taxable Person shall issue a Tax Invoice when supplying Goods or Services to a Non-Resident Person.
A Taxable Person who is obliged to pay Tax through the Reverse Charge Mechanism shall record the Tax amount due in Dinars in respect of the transaction on the invoice issued to him by the Supplier residing outside the Kingdom.
Where a Taxable Person issues a copy or several copies of the original Tax Invoice, the statement "Duplicate of original" must be displayed on every copy. Input Tax shall only be deducted using the original Tax Invoice.
Where an original Tax Invoice is lost or damaged, the Supplier may issue a duplicate invoice with a statement indicating that it has been issued to replace the original Tax Invoice.
A Taxable Person shall retain photocopies of all Tax Invoices issued by him for a period of five years from the end of the Gregorian year in which such invoices were issued.
A taxable Customer who receives Goods or Services from a taxable Supplier has the right to issue a Tax Invoice on behalf of that Supplier in accordance with the following conditions:
1. There is an agreement in writing between both parties relating to the issue of Tax Invoices by the Customer.
2. The Supplier undertakes not to issue any Tax Invoice relating to the specific transaction.
3. There is a mechanism whereby the Supplier is able to approve every Tax Invoice issued by the Customer on his behalf.
4. The Tax Invoice clearly indicates that it is issued by the Customer on behalf of the Supplier.
5. The Customer retains a copy of every Tax Invoice issued on behalf of the Supplier.
6. The invoice issued by the Customer on behalf of the Supplier meets all the conditions for a Tax Invoice provided in the Law and these Regulations.
A Taxable Person who makes several Supplies for a single Customer during a period of no more than one month may issue a summarised Tax Invoice which will be treated as a Tax Invoice, provided that the conditions for a Tax Invoice stipulated in the Law and these Regulations are met.
Notwithstanding the provisions of Paragraph A of this Article, a bank statement shall be treated as a Tax Invoice provided it contains the following information:
1. The name, address and Registration Number of the bank in the Kingdom.
2. The name and address of the Customer.
3. The date of issue of the bank statement.
4. The Tax rate applicable on every Supply.
5. The amount of Tax on every Supply.

Article 53
Special cases for issuing of simplified Tax Invoices

Notwithstanding the provisions of Article 52 of these Regulations, a Taxable Person may issue a simplified Tax Invoice in any of the following cases:
1. Where the Customer is not registered for Tax purposes in the Kingdom.
2. Where the Consideration does not exceed five hundred Dinars.
A simplified Tax Invoice must contain at least the following:
1. The name, address and Registration Number of the Taxable Person.
2. The date of issue of the simplified Tax Invoice.
3. A description of the Goods or Services supplied.
4. The total value of the Supply in Dinars, inclusive of Tax.
5. The rate and amount of Tax applicable in Dinars.

Article 54
Amendment of the Tax Invoice (Credit and Debit Notes)

A Taxable Person shall issue a corrected document where a Tax Invoice or alternative document is amended after its issue in accordance with the following:
1. If the amount of Tax due on the Taxable Supply exceeds the amount collected by the Taxable Person, he shall issue a Debit Note and calculate the value of the additional Tax due during the Tax Period in which the under-value was identified.
2. If the Tax collected by the Taxable Person exceeds the amount of Tax due on the Supply, he shall issue a Credit Note and deduct the Tax surplus during the Tax Period in which the over-value was identified.
A Credit or a Debit Note must contain at least the following:
1. The words "Credit Note" or "Debit Note" clearly stated in accordance with the cases stipulated in Paragraph A of this Article.
2. The name, address and Registration Number of the Taxable Person.
3. The name and address of the Customer.
4. A sequential Credit or Debit Note number.
5. The date of issue of the Credit or Debit Note.
6. The number of the original Tax Invoice or original document subject to the adjustment.
7. The adjusted value of the Supply and the Tax amount to be adjusted in Dinars.

Article 55
Fractions of Fils

Where a fraction of a Fils is part of calculating Tax on a Supply, the Taxable Person may round the amount to the nearest Fils, in accordance with mathematical rounding.

Article 56
Recordkeeping of Tax Invoices and similar documents

A Taxable Person may issue and retain Tax Invoices, Credit and Debit Notes and other documents that evidence his Supply in an electronic form, provided that the devices he uses for this purpose are equipped to produce such invoices and documents in a paper format and in a chronological and sequential manner and in a manner that prevents the subsequent addition or cancellation of any restrictions or modifications and where the Bureau can verify their accuracy and recordkeeping.
The Taxable Person that wishes to issue and retain Tax Invoices and documents referred to in an electronic form shall obtain prior approval from the Bureau.

Chapter 11 - Deduction and Adjustment of Tax

Article 57
Input Tax deduction

A Taxable Person shall be entitled to deduct Input Tax paid or payable by him in the course of carrying out his Economic Activity for the purposes of making the following Supplies:
1. Taxable Supplies, including Supplies subject to the zero rate.
2. Intra-GCC Supplies.
3. Supplies made outside the Kingdom where the related Tax on expenses would have been deductible had the Supplies been made in the Kingdom.
A Taxable Person shall retain the following documents:
1. Original Tax Invoices for Goods and Services supplied to him where such Tax Invoices include all the required data in accordance with the provisions of the Law and these Regulations.
2. Customs documents relating to imports he has carried out and that prove that he is the Importer of the Goods in accordance with the Customs Law.
3. Tax Invoices issued by the taxable Customer on behalf of the Supplier in accordance with the provisions of these Regulations.
4. Any other commercial documents that evidence that the Taxable Person has paid the Tax due.
The Taxable Person shall not deduct Input Tax in any Tax Period which falls more than five years after the end of the calendar year during which the right to deduct Input Tax arose.
The Taxable Person shall not be obliged to adjust Input Tax in the event that Goods supplied to him are lost, damaged or stolen. He shall have to prove the loss, damage or theft through an official record, or prove that the damage is due to the nature of the Goods themselves.

Article 58
Non-deductible Input Tax

Input Tax charged for purposes other than his Economic Activity or relating to Goods or Services intended for personal or recreational use shall not be deductible by the Taxable Person, including:
1. Tax paid in relation to the provision of recreational Services to individuals, such as hospitality and accommodation Services, food and drink, which are not provided in the normal course of business.
2. Tax paid in relation to accessing events or functions, and for trips for recreational purposes.
3. Tax paid in relation to Goods and Services used by employees free of charge and for their personal use, with the exception of any Tax paid as a result of an obligation under any other laws applied in the Kingdom.
Input Tax relating to vehicles provided by a Taxable Person to his employees shall not be deductible, except in proportion to their use for business purposes. The provisions of this paragraph shall apply to Input Tax on Supplies associated with such vehicles such as maintenance, repair and insurance Services.
The controls and conditions of deducting Input Tax related to vehicles shall be determined by a decision of the Chief Executive Officer the Bureau.
The provisions of Paragraph B of this Article shall not apply to the following categories of vehicle:
1. Vehicles that are rented by rental companies.
2. Vehicles registered and used for emergency purposes such as police cars, ambulances, fire engines.
3. Taxis and buses licensed by the Ministry of Transportation and Telecommunication.
4. Buses, trucks, cranes and other similar vehicles that can only be used in the course of an Economic Activity.

Article 59
Proportional deduction

Input Tax incurred by a Taxable Person can be deducted in full where it is attributed exclusively and directly to Supplies that grant the right of deduction in accordance with the provisions of the Law and these Regulations.
Input Tax incurred by a Taxable Person can not be deducted where it is attributed exclusively and directly to Supplies that do not grant the right of deduction in accordance with the provisions of the Law and these Regulations.
Where the Input Tax is related to Goods and Services used to make Taxable Supplies and non-Taxable Supplies, and the Taxpayer can not attribute the Input Tax exclusively and directly to any of these Supplies, he shall, for the purposes of exercising the right to deduct, use a proportional deduction ratio.
For the purposes of applying this Article, the proportional deduction ratio shall be determined as the ratio between the total value of Supplies that confer the right to deduct (the numerator), and the total value of all Supplies carried out by the Taxable Person, including those which do not confer that right (the denominator).
In order to compute the proportional deduction ratio, the value of the following transactions shall not be included:
1. Supplies of Capital Assets allocated for the exercise of the Economic Activity.
2. Supplies which are incidental and do not constitute the core activity of the Taxable Person.
3. Supplies taking place outside the Kingdom which are supplied from an establishment of the Taxable Person outside the Kingdom.
4. Transactions out of the scope of Tax.
The Taxable Person shall determine at the end of each Tax Period the proportional deduction ratio calculated on the basis of the actual value of the Supplies made during this Tax Period.
At the end of the Tax year, the Taxable Person shall compute the proportional deduction ratio based on the actual value of Supplies made in that Tax year. Where the amount of deductible Input Tax for the Tax year resulting from this annual computation differs from the total amount of Input Tax actually deducted throughout the Tax year, the Taxable Person shall make an adjustment for this difference.
This adjustment shall be made in the final Tax Period for that Tax year or in the first Tax Period of the following Tax year.
For the purposes of the adjustment of Input Tax on Capital Assets, a Tax year shall mean a period of twelve consecutive months made of either four Tax Periods (quarterly) or twelve (monthly) Tax Periods, as determined by the Bureau.
The proportional deduction ratio, expressed as a percentage, shall be rounded up to the nearest decimal number.
The Taxable Person, following the Bureau's approval, shall be entitled to use other methods to calculate the proportional deduction ratio reflecting his Economic Activity.
The Bureau may oblige the Taxable Person to use another method to calculate the proportional deduction ratio when the computation method stipulated in this Article does not provide a fair and reasonable reflection of his Economic Activity.

Article 60
Adjustment of Input Tax on Capital Assets

For the purpose of adjusting Input Tax on Capital Assets, the lifetime of Capital Assets is determined by the following periods:
1. A period of no less than five years for intangible assets and movable tangible assets.
2. A period of no less than ten years for immovable tangible assets.
The period during which a Taxable Person shall adjust Input Tax on Capital Assets is determined as follows:
1. Over five years for movable tangible Capital Assets and intangible Capital Assets starting from the Tax year during which those Capital Assets were first used with each subsequent year beginning after the end of the preceding Tax year.
2. Over ten years for immovable tangible assets starting from the Tax year during which those Capital Assets were first used with each subsequent year beginning after the end of the preceding Tax year.
The Taxable Person shall deduct Input Tax in accordance with the provisions of Articles 42, 43 and 45 of the Law in the first Tax year during which the Capital Assets are used for the first time, and shall record the deduction ratio expressed as a percentage.
The Taxable Person shall, at the end of each subsequent Tax year within the adjustment period, calculate the deduction ratio, expressed as a percentage, for the Capital Assets in accordance with the provisions of Articles 42 and 45 of the Law.
If there is a difference between the deduction ratio for the first year and the deduction ratio for a subsequent year, the Taxable Person shall make an adjustment with respect to this difference according to the following formula:
1. For intangible Capital Assets and movable tangible Capital Assets, the formula is as follows:
  (Total Input Tax incurred on the asset x 20%) x (deduction ratio for the relevant subsequent year less deduction ratio for the first year)
2. For immovable tangible Capital Assets, the formula is as follows:
  (Total Input Tax incurred on the asset x 10%) x (deduction ratio for the relevant subsequent year less deduction ratio for the first year)
The Taxable Person shall report the adjustment resulting from the application of the appropriate formula in accordance with Paragraph E of this Article in the last Tax Period for that subsequent Tax year or in the first Tax Period for the following Tax year.
Where, during the adjustment period, a Taxable Person surrenders a Capital Asset by way of sale, the adjustment shall be carried out as follows:
1. Where the surrender of the Capital Asset is taxable, the Taxable Person shall make a one-off adjustment according to the following:
  1. For intangible Capital Assets and movable tangible Capital Assets, the formula is as follows:
    (Remaining years in adjustment period / 5 x total Input Tax incurred on the asset) x (100% less deduction ratio for the first year)
  2. For immovable tangible Capital Assets, the formula is as follows:
    (Remaining years in adjustment period / 10 x total Input Tax incurred on the asset) x (100% less deduction ratio for the first year)
2. Where the surrender of the Capital Asset is exempt from Tax, the Taxable Person shall make a one-off adjustment according to the following:
  1. For intangible Capital Assets and movable tangible Capital Assets, the formula is as follows:
    (Remaining years in the adjustment period / 5 x total Input Tax incurred on the asset) x (0% less deduction ratio for the first year)
  2. For immovable tangible Capital Assets, the formula is as follows:
    (Remaining years in the adjustment period / 10 x total Input Tax incurred on the asset) x (0% less deduction ratio for the first year)
A Taxable Person shall report the adjustment resulting from the application of the appropriate formula in accordance with Paragraph G of this Article in the last Tax Period of the Tax year during which the Capital Asset was surrendered or in the first Tax Period of the following Tax year.
No adjustment is required if the Capital Asset is damaged or lost before the end of the adjustment period. The Taxable Person shall notify the Bureau when this occurs before the end of the Tax year during which such damage or loss occurred.
Where a Taxable Person transfers his Capital Assets as part of the surrender of his Economic Activity, the following shall apply:
1. The adjustment year end on the day preceding the date of the surrender and the Taxable Person shall make the necessary adjustment for that year in the Tax Period during which the surrender is made.
2. The subsequent adjustment year shall start on the day of the surrender and the adjustment for this year shall be made by the purchaser at the end of a twelve month period starting on the day of the surrender. The adjustment procedure shall continue for the remaining years in the adjustment period in the same manner.
Where a Taxable Person joins a Tax Group, the following shall apply in relation to his Capital Assets:
1. The adjustment year shall end on the day prior to the Taxable Person joining the Tax Group and he shall make the necessary adjustment for that year in the Tax Period during which he joined the Tax Group.
2. The subsequent adjustment year shall start on the day of the Taxable Person joining the Tax Group and the adjustment for that year shall be made by the Tax Group at the end of a twelve month period starting on the day of him joining the Tax Group. The adjustment procedure shall continue for the remaining years in the adjustment period in the same manner.
Where a Person ceases to be a member of a Tax Group and becomes a Taxable Person on an individual basis, the following shall apply with respect to his Capital Assets:
1. The adjustment year shall end on the day prior to him ceasing to be a member of the Tax Group and the Tax Group shall make the necessary adjustments for that year in the Tax Period during which he ceases to be a member.
2. The subsequent adjustment year shall start on the day where the Person ceases to be a member of the Tax Group and the adjustments for this year shall be made by that Person at the end of a twelve month period starting on the day of him ceasing his membership. The adjustment procedure shall continue for the remaining years in the adjustment period in the same manner.

Article 61
Right to deduct Input Tax paid prior to VAT registration date

A Taxable Person shall be entitled to deduct Input Tax incurred on Goods and Services supplied to him or imported by him prior to the date of registration for Tax purposes in accordance with the following conditions:
1. The Goods must have been supplied to him or imported within a period not exceeding five years prior to the effective date of registration of the Taxable Person for Tax purposes and shall still be in the possession of the Taxable Person on the effective date of his registration for Tax purposes.
2. The Services must have been supplied to him within a period not exceeding six months prior to the effective date of registration of the Taxable Person for Tax purposes.
3. They must have been supplied to him or imported within the course of his Economic Activity conferring the right to deduct Input Tax in accordance with the provisions of the Law and these Regulations.
A Taxable Person shall be entitled to deduct Input Tax incurred on Capital Assets supplied to him or which he imported prior to the effective date of his registration for Tax purposes provided that the following conditions are met:
1. Such Capital Assets must have a positive net book value at the effective date of the Taxable Person's registration for Tax purposes.
2. They must have been supplied to him or imported for the purposes of his Economic Activity conferring the right to deduct Input Tax in accordance with the provisions of the Law and these Regulations.
The maximum deductible Input Tax permitted on a Capital Asset acquired or imported by the Taxable Person prior to the effective date of his registration for the Tax purposes shall be calculated on the basis of the net book value of the Capital Assets, determined in accordance with the accounting practice of the Taxable Person.
For the purpose of computing the adjustment period applicable to Capital Assets acquired or imported by the Taxable Person before the effective date of his registration for the purposes of Tax, the first year of the adjustment period is deemed to start on the date of first use of the Capital Asset by the Taxable Person.

Article 62
Basis of Input Tax adjustment before VAT registration date

A Taxable Person shall deduct the deductible Input Tax in accordance with the provisions of Article 61 of these Regulations on his Tax Return for the first Tax Period after registration.
For the purposes of applying Paragraph A of this Article, a Taxable Person shall provide the Bureau with a list enabling it to determine the deductible Tax value on the relevant purchases in addition to the following:
1. An inventory of the stock of the Goods and raw materials available to him at the effective date of his registration setting out the nature, quantity and value of the stock of Goods and raw materials in detail, the date of purchase of each part, and the amount of the input Tax paid thereon.
2. An inventory of all the Capital Assets in his possession on the effective date of registration setting out their detailed description, the date of purchase of each part, and the amount of the Tax paid for each transaction.
3. Copies of Tax invoices issued by the Supplier of Goods and Services acquired.
4. Customs declarations for imports.
The Bureau may carry out appropriate supervisory procedures to verify the accuracy of the inventory and asset data, on a case by case basis, and may request the Taxable Person to provide access to the necessary documents to verify the accuracy of the information provided by him.

Chapter 12 - Payment of Tax

Article 63
Rules for Payment of Tax

A Taxable Person shall pay the Tax due for the Tax Period, at the latest, by the last day of the month following the end of that Tax Period.
Where the Taxable Person has not submitted his Tax Return or where his calculation of Tax proved to be incorrect, the Taxable Person shall pay the Tax, Tax differences and administrative fines due (if imposed) resulting from an assessment issued by the Bureau within a period of thirty days from the date of notifying the Taxable Person, or before the date specified in the assessment.
In accordance with the provisions of the Law relating to administrative fines and penalties, any Person who issues an invoice showing Tax due shall pay this amount to the Bureau, even if the transaction is not taxable or taxable at the zero rate or partially or fully exempted and incorrectly classified as a taxable transaction.
A Taxable Person shall pay the Tax due in accordance with the Reverse Charge Mechanism after declaring it on his Tax Return.

Article 64
Mechanism for payment of Tax

Tax, Tax differences and administrative fines due to the Bureau shall be payable electronically in accordance with a mechanism determined by the Bureau.
The Taxable Person shall, upon payment of the Tax due, provide all details related to his Tax Registration Number and determine the Tax Period for which the Tax is paid.
Each Taxable Person shall have an independent Tax account maintained by the Bureau, in which the Tax due for each Tax Period, a current balance which relates to the total Tax payable, the administrative fines, the fees due and any other amounts due shall be recorded.
The details of the Tax account shall be made available to the Taxable Person electronically, to enable him to access his account in accordance with the mechanisms set by the Bureau.
The Taxable Person may apply to the Bureau for payment of the Net Tax due in installments for a particular Tax Period, provided that he proves that he is unable to pay the amount of Tax in full within the period specified in the Law. The Bureau shall notify the applicant of the result within thirty days from the date of his submission, whether it has been accepted or rejected, through the means prescribed in the Law. Where the Bureau approves the installment application, the Taxable Person shall pay the installments within the periods set in the application acceptance. Where the Taxable Person does not adhere to the payment dates set, all remaining installments shall be due immediately.

Article 65
Payment of Tax at importation

Tax due at import shall be paid to Customs Affairs at the Ministry of Interior and shall be collected in accordance with the established procedures for the payment and collection of customs duties.
Where Tax has been suspended pursuant to the conditions stipulated in the Customs Law for the Cooperation Council for the Arab States of the Gulf, Tax shall be due on the date of the release of the Goods and shall be paid to the Customs Affairs Department at the Ministry of Interior.
Tax shall be collected in accordance with the established procedures for the payment and collection of customs duties.
For deferred Tax due on imports pursuant to the provisions of the Law, the Taxable Person shall include, in his Tax Return relating to the concerned Tax Period, the deferred Tax as deductible Tax due in accordance with the rules and provisions stipulated in the Law and these Regulations.

Chapter 13 - Domestic Reverse Charge Mechanism

Article 66
Domestic Reverse Charge Mechanism

Where the conditions set out in Paragraph D of this Article are met, a Taxable Person who is primarily engaged in making Intra-GCC Supplies or Exports of Goods may submit an application to the Bureau, using a form prepared by the Bureau for this purpose, to use the domestic Reverse Charge Mechanism, on certain purchases of Goods and Services which are subject to Tax at the standard rate.
Where the Bureau approves the Taxable Person's application, and after verifying that all of the conditions are met, a certificate shall be issued to the Taxable Person granting him the right to apply the domestic Reverse Charge Mechanism on certain purchases.
Where the Taxable Person submits a copy of the certificate issued by the Bureau to a Taxable Person for Supplies of Goods or Services made to him and where all the conditions are met, the following shall apply:
1. The Tax on the Supply of such Goods or Services shall not be calculated by the taxable Supplier.
2. The Taxable Person receiving the Goods or Services shall calculate the Tax due on such Supplies and declare such Tax through his Tax Return.
In order to obtain the approval from the Bureau to apply the Reverse Charge Mechanism, the following conditions must be met:
1. The Tax due on the Goods or Services supplied to the Taxable Person shall be fully recoverable by the Taxable Person as Input Tax.
2. The Taxable Person shall demonstrate that the total amount of Intra-GCC Supplies and Exports exceeds 50% of the total value of his Supplies.
3. The Taxable Person shall provide reasonable grounds to the Bureau evidencing that the Net Tax, in accordance with his Tax Return, will be a negative amount on a recurring basis and that the negative amount will have a material impact on his financial position.
Where, following the receipt of approval from the Bureau to apply the domestic Reverse Charge Mechanism, one of the conditions set out in Paragraph D ceases to be met, the Taxable Person shall notify the Bureau within thirty days, of the date when he fails to meet any of these conditions. The Bureau shall revoke his approval to use the domestic Reverse Charge Mechanism.
In all cases, the Bureau may revoke its approval to allow the Taxable Person to apply the Domestic Reverse Charge Mechanism by a notification issued to the Taxable Person specifying the effective date of the cancellation.

Chapter 14 - Supplies subject to zero rate

Article 67
Export of Goods to outside the territory of the Implementing States and Supply of Goods to or within a customs suspension regime

Tax shall be imposed at the zero rate on an export of Goods to outside the territory of the Implementing States or on a Supply of Goods to or within a customs duty suspension regime if all of the following conditions are met:
1. The Goods are actually transferred to a place outside the Implementing States or are supplied to or within a customs duty suspension regime within ninety days from their date of Supply.
2. The Goods shall be exported, or supplied to or within a customs duty suspension regime, by the Taxable Person or directly by the Customer or on their behalf.
3. The Goods have not been changed or used in the Kingdom or supplied to a third Person between their date of Supply and the date of transferring them outside the Implementing States or to or within a customs duty suspension regime. This does not include the necessary work to prepare the Goods for export.
4. The Taxable Person shall maintain commercial and official documents evidencing the transfer to outside the Implementing States or to or within a customs suspension regime.
Documents evidencing the export or Supply of Goods to or within a customs duty suspension regime shall include:
1. Documents issued by Customs Affairs at the Ministry of the Interior that confirm the export or Supply to or within a customs duty suspension regime.
2. Commercial documents which show the identity of the Supplier, the Customer, the place of delivery of the Goods and their destination, including the bill of lading, the airway bill, certificate of shipment and other related documents.
3. Transportation documents indicating the delivery or receipt of Goods outside the Territory of the Implementing States.
In the event that the export or Supply to or within a customs duty suspension regime is not evidenced, the Bureau may refuse to treat the Supply as taxable at zero percent.

Article 68
International transportation of passengers and Goods and related Services

Tax shall be imposed at the zero rate on a Supply of transport of passengers or Goods to and from the Kingdom, which commences or ends in the Kingdom or passes through its territory, and on Services and the Supply of Means of Transport associated with such transport as follows:
1. Transport of passengers or Goods, from the Kingdom to a final destination outside the Kingdom,
2. Transport of passengers or Goods from a place outside the Kingdom to a final destination in the Kingdom,
3. Transport Services in the Kingdom, where the transport is part of a Supply of transport Services from the Kingdom to a final destination outside the Kingdom or from a place outside the Kingdom to a final destination in the Kingdom.
International transportation shall be made through the use of Means of Transport.
Tax shall be imposed at the zero rate on a Supply of Services and Goods directly or indirectly associated with a Supply of international transportation of passengers and Goods, including the following Supplies:
1. A Supply of Goods and Services for use or consumption on board a Means of Transport,
2. Loading and unloading of machinery and equipment used for the transport of Goods, loading of products, unloading, transporting, stowing, packaging, weighing, measuring, monitoring, expertise (including expert Services, commissions closely related to export transactions and equipment intended for export),
3. Rental of containers and equipment for the protection of Goods intended for export,
4. Rental of machinery and equipment that is used to transport Goods intended for export,
5. Security and storage of Goods intended for export,
6. Packaging of Goods that are intended for export,
7. Transactions necessary for export transactions which are carried out by an approved clearance agent of the Customs Department,
8. Visa transactions and related Services and insurance transactions for passengers.
Tax shall be imposed at the zero rate on a Supply of a Means of Transport, and on a Supply of Goods and Services associated with maintaining, repairing, or converting the Means of Transport, including the Supply of spare parts, consumable materials and other necessary components that are installed or assembled in the Means of Transport.

Article 69
Healthcare Services

Tax shall be imposed at the zero rate on Healthcare Services. Such Services must be qualifying medical Services provided by qualified medical professionals or qualified medical institutions pursuant to the laws and legislation in force in the Kingdom.
Qualifying medical Services include the following examples:
1. General medical health Services,
2. Specialist medical health Services, including surgery,
3. Dental Services,
4. Services related to the treatment of mental illnesses,
5. Occupational or surgical health Services,
6. Speech therapy,
7. Physiotherapy provided by a qualified medical professional,
8. Sight and hearing tests,
9. Nursing care (including care in a nursing home),
10. Services relating to diagnosing an illness, including the analysis of any samples and x-rays,
11. Vaccinations,
12. Health testing and screening that is undertaken under a local law, documented policy or contractual obligation.
A cosmetic procedure shall not be considered as a qualifying medical service unless provided as part of treating a medical condition as determined by a qualified medical professional.
Qualified medical institutions, for the purposes of applying the provisions of this Article, include hospitals, physiotherapy centres, medical centres, private clinics, alternative medical centres and clinics for practicing any supporting medical professions licensed by the National Health Regulatory Authority, or under the supervision of the Ministry of Health.
Qualified medical professionals, shall mean Persons who are licensed as practitioners by the National Health Regulatory Authority or under any other authorised medical body in the Kingdom, and include but are not limited to:
1. Medical practitioners.
2. Midwives.
3. Nurses.
4. Mental health specialists.
5. Dentists.
6. Opticians.
7. Radiologists.
8. Pathologists.
9. Paramedics.
10. Pharmacists.

Article 70
Supply of Goods and Services associated to the Supply of Healthcare Services

A Supply of Goods and Services associated with a Supply of Healthcare Services provided to a patient during the course of his treatment shall be subject to the zero rate.
Goods and Services shall be associated with a Supply of Healthcare Services when they are an integral part of the Healthcare Services and shall be provided together with the qualifying medical Services and shall include, but not be limited to:
1. Drugs, medicines, bandages and other medical consumables administered or used during the course of performing qualifying medical Services,
2. Laboratory Services performed by qualified persons,
3. Transport Services for patients or those injured,
4. Accommodation and catering Services provided by a qualified medical provider to its patients,
5. Mortuary Services provided by qualified medical providers,
6. Medical consultations provided remotely by means of electronic communications such as telephone or video link.
The following are examples of Goods and Services that shall not be regarded as associated with a Healthcare Service in accordance with Paragraph B of this Article:
1. The Supply of food and beverages to any Person who is not a patient,
2. Parking and valet Services,
3. Telephone, internet and Electronic Services, including TV rental Services,
4. Accommodation provided to any Person who is not a patient.

Article 71
Medicines and medical equipment

Tax shall be imposed at the zero rate on a Supply or import of medicines and medical equipment in accordance with what is clarified by the competent medical authority in the Kingdom.

Article 72
Re-export

Tax shall be imposed at the zero rate on the re-Export of Goods which are temporarily imported into the Kingdom for repair, conversion, restoration and processing under the conditions stipulated in the Customs Law. These include Goods related to imported and re-exported Goods and those that became part of them, as well as Goods that become unusable or worthless as a result of their use within the context of repair, restoration, conversion or processing.
Documents which evidence the re-Export of Goods shall include the following:
1. Documents issued by Customs Affairs at the Ministry of Interior evidencing the re-Export.
2. Commercial documents which show the identity of the Supplier, the Customer, the place of delivery of the Goods and their destination, including the bill of lading, airway bill, certificate of shipment and other relevant documents.
3. Transportation documents evidencing that the Goods have been delivered or received outside the Territory of the Member States.

Article 73
Supply of Services to a Non-Resident Customer

Tax shall be imposed at the zero rate on a Supply of Services made by a resident taxable Supplier subject to the following conditions:

The Services shall be supplied to a Customer who has no Place of Residence in the Kingdom or any Implementing State and who was outside the Kingdom at the date the Services were performed.
The Services relate to tangible Goods or real estate located outside the territory of the Implementing States at the date the Services were performed.
The Services are performed outside the territory of the Implementing States.
The Services shall be enjoyed outside the territory of the Implementing States.

Article 74
Supply of gold, silver and platinum

Tax shall be imposed at the zero rate on the Supply or import of gold, silver and platinum for investment purposes, if the purity of the metal is not less than 99% and it is tradeable in the global bullion market, based on a certificate issued by the concerned body which examines metals and precious stones in the Kingdom.
Tax shall be imposed at the zero rate on the first Supply after the extraction of gold, silver and platinum for trading purposes.

Article 75
Supply of pearls and precious stones

The Supply or import of pearls and precious stones shall be subject to the zero rate.
The Supplier shall obtain a certificate issued by the concerned body for examining pearls and precious stones to determine their quality.

Article 76
Construction of new buildings

The zero rate shall apply to the Supply of construction Services in relation to new buildings carried out by the Taxable Person. Goods Supplied by a Person making a Supply of construction Services, in the course of providing construction Services for a new building, shall also be zero rated.
For the purposes of applying this Article, a "building" shall mean residential, commercial or industrial buildings, such as a dwelling, offices, factories, workshops, retail stores, multi-storey car parks, power stations, oil refineries, liquefied natural gas stations or oil fields.
Construction Services in relation to new buildings shall include the following:
1. Construction works,
2. Site clearance Services,
3. A new extension to an existing building.
4. Services provided by engineers and surveyors and similar Services of a supervisory nature.
Construction of buildings shall not include the following activities:
1. Demolition of existing buildings on the land on which the new building is to be constructed.
2. Architects' and interior design fees.
3. Restoration works.
Goods supplied by a Taxable Person as part of the provision of construction Services in relation to a new building shall include those used, installed or incorporated into the building or its location, and shall include:
1. Building materials.
2. Materials necessary to construct specialised raised flooring for computer server rooms.
3. Fixtures and equipment to the extent that such fixtures and equipment are permanently affixed to the building and can not be removed without causing damage to the building or the plant and equipment.
4. Goods supplied to conduct civil engineering works necessary for the development of the building including:
  1. Sewerage systems.
  2. Piping.
  3. Roads and paths necessary for the proper use and enjoyment of the building.
  4. Car parking for use by the occupants of the building and visitors.
5. Goods supplied to connect the building to a water supply and Telecommunications Services.
6. Photovoltaic cells and related equipment designed to produce electricity and hot water for the building.
The Supply of Goods provided in the course of construction Services in relation to a new building shall not include the Supply of fixtures and equipment not permanently affixed to the building and which can be removed without damage to the building or fixtures and equipment, including:
1. Furniture that is not affixed to the building.
2. Goods supplied for landscaping purposes.
3. Swimming pools.
4. Decorative lighting.
5. Paintings, murals and other artwork.
6. Carpets.
7. Moveable partitions.
A Taxable Person who makes Taxable Supplies subject to the zero rate, and other activities subject to a different Tax treatment in the course of executing a particular contract, shall apportion the contract price to determine the price of each of the parts of the contract subject to a different Tax treatment, provided that each part does not fall below the fair Market Value for the Goods or Services supplied.
The zero rate shall not apply to Goods or Services supplied after the building has been completed.

Article 77
Educational Services and related Goods and Services

The Supply of Educational Services and related Goods and Services by kindergartens, pre-primary, primary, secondary and higher education institutions shall be subject to the zero rate.
The Supply of Educational Services and related Goods and Services shall be zero rated only if the Supplies are made by a school or educational institution licensed by a competent authority in the Kingdom and provided to a student who is enrolled in that school or institution.
Educational Services shall not include the following:
1. Professional education
2. Vocational training, unless such vocational training is provided by a polytechnic educational institution which is licensed by a competent authority in the Kingdom.
Goods and Services related to Educational Services shall include Goods and Services directly related to the provision of the Educational Service which are mandatory, including the following:
1. Subscription fees, application fees or any form of administration fee,
2. Printed and digital books and reading material which is educational in nature and are directly related to the curriculum,
3. Student accommodation supplied by the educational institution to students enrolled with the educational institution, provided that such accommodation has been constructed or adapted specifically for use by students,
4. Activities and trips organised by the educational institution for its students if these directly relate to a specific educational curriculum.
The following Supplies shall not be regarded as related to educational Services:
1. School uniforms,
2. Food and beverages supplied at the educational institution,
3. Stationery,
4. Activities and trips organised by the educational institution for recreational purposes.
5. Electronic devices supplied by the educational institution.

Article 78
Local transportation

Tax shall be applied at the zero rate on a Supply of Services for transporting Goods and passengers by land, water or air from a place inside the Kingdom to another place in the Kingdom.
The zero rate shall not apply to the following:
1. Transportation Services provided by any Person who does not meet any regulatory or licensing requirements from the authorised body to Supply such Services.
2. Services of vehicle rental without a driver.
3. Transportation Services provided for sightseeing or leisure purposes.
4. Food delivery Services provided by a Person supplying food.
5. A transportation Service which is ancillary to the principal Supply of a Good or Service which is taxable at the standard rate and is not priced separately to the Supply of a Good.

Article 79
Oil, oil derivatives and gas

Tax shall be applied at the zero rate on the following:
1. The Import and Supply of oil, gas and other hydrocarbons, whether processed or unprocessed.
2. The grant of a right to use, explore or exploit any part of the Kingdom to search for, extract or produce oil, gas or other hydrocarbons.
3. The Supply of oil and gas exploration Services.
4. The Supply of oilfield and gas field related Services, including but not limited to, design, drilling, rig set-up, drilling, extraction, recovery, separation, evaluation, feasibility analysis, testing, seismic and geophysical surveys, and repair and maintenance Services.
5. The Supply of specialist professional Services, where such Services are required for the exploration or exploitation of oil and gas sites and potential oil and gas sites;
6. The Supply of oil refining or gas processing Services, including regasification of liquefied natural gas;
7. The distribution or transportation of oil, gas or other hydrocarbons;
8. The storage of oil or gas or other hydrocarbons;
9. The Import or Supply of consumables that are used directly and exclusively in the making of Supplies listed in Clauses 1 to 8 in Paragraph A of this Article.
10. The import, purchase or lease of equipment that is used directly and exclusively for the purpose of making Supplies listed in Clauses 1 to 8 of Paragraph A of this Article.
Imports and Supplies of Goods produced from oil, gas and other hydrocarbons such as fertiliser and plastics shall not be subject to the zero rate.

Article 80
The Supply and Import of specific food items

Tax shall apply at the zero rate on the Supply and import of food items, in accordance with the following conditions:

The Goods are not supplied by a restaurant, coffee shop or other similar establishment,
The Goods are not supplied by caterers.

CHAPTER 15 - EXEMPTIONS

Article 81
Supply of financial Services

The Supply of the financial Services specified in Paragraph B of this Article shall be exempt from Tax, except where the Consideration for the Service is expressly determined as a fee, commission or commercial discount.
Financial Services shall mean Services related to cash transactions, including, but not limited to the following transactions:
1. Depositing money in current accounts, savings accounts or deposits.
2. Granting and transferring loans, borrowings and credit.
3. The issue or cancellation of cheques, debit cards and credit cards.
4. The issue, transfer, receipt or any dealing with money or any financial bond or any banknotes or money orders.
5. The Supply or issue of financial derivatives or deferred contracts or any necessary arrangements for them.
6. The Supply or issue of shares, stocks, bonds and securities related to them.
7. Transactions related to ATMs, excluding the Supply, installation or maintenance of these machines or the Supply of a programme used for their operation.
8. The conversion of currency either through the exchange of banknotes or any related matters.
9. The provision or transfer of financial instruments, sukuks, swaps, options, or any futures contracts.
10. The issue, allotment, renewal, amendment, rent or transfer of ownership of a debt or equity security (whether listed or unlisted), credit contract or the like.
11. The provision, or transfer of ownership of a life insurance or reinsurance contract.
12. The provision of insurance cover or annuities under any investment scheme,
13. The provision, acquisition, amendment or release of a guarantee, indemnity or security that relates to the performance of obligations arising under a cheque, credit security, debt security, or similar document.
14. Any Islamic financial product provided in accordance with legally approved contracts, which is similar to a conventional financial product in terms of the intended objective and materially achieve the same result.
15. Commissions for brokerage Services, or under a mudaraba or wakala contract.
The following financial Services shall be exempt regardless of the form of the Consideration payable for them:
1. The issue, allotment, or transfer of ownership of an equity security or debt security.
2. Executing life insurance and reinsurance contracts, and transferring ownership of them.
Services provided by investment funds shall be exempt from Tax where they relate to the issue of financial derivatives, or deferred contracts or issuing shares, stocks, bonds and equity securities related thereto and arrangements necessary for these activities.
Islamic financial products provided under a written contract which relate to a Supply of financing in accordance with the principles of Shari'ah and which simulate the intention and achieve effectively the same result as a non-Shari'ah compliant financial product shall be treated in a similar manner as the equivalent non-Shari'ah financial product for the purpose of applying the exemption for financial Services.
The provisions of this Article shall not contradict Clause 7 of the first paragraph of Article 53 of the Law concerning the Supply of Financial Services from a taxable Supplier resident in the Kingdom to a Customer who is not resident in the territory of the Implementing States benefiting from the Services outside the territory of the Implementing States.

Article 82
Sale and rent of real estate

The following - for the purposes of applying the provisions of Article 55 of the Law - shall not be considered as the sale or lease of real estate:
1. The provision of hotel accommodation,
2. The provision of paid car parking for periods of less than one month;
3. The lease of serviced office space where the Customer does not have the right to use a designated space on an exclusive basis;
4. Rental of a function room, hall or similar facility;
5. Management Services, utilities, Telecommunications, internet and television charged for separately and in addition to the rent.
Furniture, fittings, plant and apparatus which are not attached to land or a building and which can be removed without damaging the property shall not be treated as real estate for the purpose of Article 55 of the Law.
If residential real estate is rented furnished or semi-furnished, the entire consideration for the rental shall be treated as a Supply of real estate where no separate charge is made for the use or rental of the furniture, fixtures and fittings.

Article 83
Exemption cases at import

Imports of Goods which are exempt from customs duties, in accordance with the conditions and controls stipulated in the Customs Law for the Cooperation Council for the Arab States of the Gulf, shall be exempt from Tax in the following cases:
1. Imports of personal baggage and used household items brought by citizens residing abroad and foreigners arriving to reside in the Kingdom for the first time provided that the personal baggage and household items:
  1. Accompany the Person arriving to the Kingdom and are part of his property and are not intended for trade.
  2. Are prepared for personal or household use such as furniture or used household appliances.
2. Imports of gifts accompanying passengers.
3. Imports into the Kingdom of returned Goods previously exported, provided that the Importer shall submit documents and information evidencing that these Goods have been exported after the implementation of the Law.

Article 84
Diplomatic and military exemptions

Goods imported by military forces, and security bodies operating in the Kingdom shall be exempt from Tax, in accordance with the conditions and controls stipulated in the Customs Law, provided that such Goods are for the purpose of carrying out the operations of such forces and bodies. Goods imported by diplomatic and consular bodies, international organisations and heads and members of the diplomatic and consular corps accredited to the Kingdom shall also be exempt within the limits of the principle of reciprocity, or in accordance with the provisions of international conventions and treaties.
Notwithstanding what was set out in Paragraph A in this Article, a Supply of Goods exempted under the provisions of this Article shall be taxable when sold or disposed of in the Kingdom.

Article 85
Exemption of Supplies related to Persons with special needs

In accordance with the conditions and controls stipulated in the Customs Law, the import of necessities and equipment used by Persons with special needs shall be exempt from Tax.
The Importer shall submit the necessary data and documents to prove that the conditions set out in Paragraph A of this Article are met, provided that such documents are issued or certified by the authorised bodies in the Kingdom.

CHAPTER 16 - REFUND OF TAX

Article 86
Refund of Tax by a Taxable Person

A Taxable Person shall be entitled to request a refund of an excess Tax amount in any of the following cases:
1. Where, in accordance with the provisions of the Law and these Regulations, there is excess deductible Net Tax per a Tax Return. The Taxable Person may carry forward such excess in his Tax account to the subsequent Tax Period.
2. Where a Taxable Person pays an amount in excess of the Net Tax payable.
3. If there is an excess Net Tax recoverable in the event of deregistration of a Taxable Person, subject to the approval of the deregistration application by the Bureau.
The Bureau may set off excess Net Tax recoverable against any tax or administrative fines due by the Taxable Person under the provisions of the Law or any other tax law until the excess is exhausted.
A Taxable Person may request the Bureau to refund Tax in the cases stipulated in Paragraph A of this Article within of five years from the end of the year in which any such cases occur.
The Bureau shall respond to the request within sixty days, renewable by the same period, from the date of meeting the requirements relating to documentation.
The Bureau may audit and review the accounts of the Taxable Person in order to verify the validity of the refund request and, within sixty days from the date of meeting requirements relating to documentation, shall notify the applicant of its decision to approve or reject the request.
On approval of a refund request, the Bureau shall refund the recoverable amounts by bank transfer to the bank account of the refund applicant within thirty days from the date of issue of its decision to approve the refund request.

Article 87
Refund of Tax paid by individuals in another Implementing State

The Bureau shall be entitled to refund Tax paid by individuals in an Implementing State on Goods acquired by them, with consideration to the following:
1. The individuals should be resident in the Kingdom and not registered for Tax purposes.
2. Goods acquired from the Implementing State must have entered the Kingdom.
3. The value of the Goods acquired must exceed one thousand Dinars.
The Tax shall be adjusted in accordance with the Automated Direct Transfer Mechanism applicable under the framework of the GCC Customs Union or in accordance with any other mechanism agreed between the Member States.
Where no proof of payment is made in the other Member State, the Bureau shall be entitled to impose Tax on such Goods upon entry into the Kingdom.

Article 88
Refund of Tax paid by foreign governments, international organisations, diplomatic missions and institutions, consular and military bodies

The Bureau may refund Tax paid on the Supply of Goods and Services in the Kingdom to foreign governments, international organisations, diplomatic missions and institutions, consular and military bodies, within the limits of the principle of reciprocity, or in accordance with international conventions and treaties following coordinating with the Ministry of Foreign Affairs.
A refund request must be submitted in accordance with a form prepared by the Bureau for this purpose.
The Bureau may request copies of Tax Invoices or any additional information to verify the validity of the recovery request, and the applicant must submit the required information within thirty days from the date of submission of the refund request.
In all cases, no refund request can be made for a Tax amount of less than one hundred Dinars.
The Bureau shall decide on the request for a refund within sixty days of the date of submission of the application after verifying the validity of the application, and it shall inform the applicant of its decision in this regard, whether it is to approve or reject the application.
On approval of the refund request, the Bureau shall refund by means of a bank transfer to the bank account of the applicant within thirty days from the date of approval of the refund request.

Article 89
Refund of Tax by Tourists

The Bureau shall, in accordance with a mechanism it shall set, allow Tourists to request a refund of Tax paid in the Kingdom on Goods transported outside the territory of the Implementing States, provided the following conditions are met:
1. The Supply of Goods is made during the Tourist's stay in the Kingdom.
2. The Goods are acquired for personal use.
3. The Goods are supplied by a Supplier authorised for this purpose. The Bureau shall issue a list of all Suppliers authorised to implement the refund mechanism.
4. The Tourist shall leave the Kingdom within two months from the date of Supply with the Goods he has purchased.
The refund application of Tax paid by the Tourist shall include the following:
1. Proof of payment of Tax such as a Tax Invoice or any similar document in accordance with the provisions of the Law and these Regulations.
2. A description of the Goods purchased in the Kingdom subject to the refund application.
3. A copy of the passport and travel ticket.

Article 90
Refund of Tax paid by Non-Resident Persons

The Bureau may refund Tax paid in the Kingdom to Non-Resident Persons based on a request submitted on a form prepared for this purpose for the following Persons:
1. Taxable Persons resident in any of the Implementing States.
2. A Person who is not resident in a territory of any Implementing State, subject to meeting the following conditions:
  1. He does not make any Supply of Goods or Services which would make him liable to pay Tax in the Kingdom or any Implementing State during the period to which the refund request relates.
  2. He shall be registered for Tax purposes or other similar Tax in his country of residence.
  3. The Tax is incurred by the Non-Resident Person for the purposes of his business activity.
The refund application shall be accompanied by all supporting documents and shall be submitted within three months from the end of the year during which the Tax was due.
The Bureau shall process the request and notify the applicant of its decision to accept or reject the request within three months from the date of submission of the application.
The refundable amounts approved by the Bureau shall be paid in accordance with the mechanism set by the Bureau, provided that a mechanism agreed between the concerned countries is implemented to deal with refund applications submitted by Taxable Persons residing in any other Implementing State.
The refund request shall include, at a minimum, the following data:
1. The name and address of the Person requesting the refund.
2. A description of his activities.
3. Details of the registration of the Person making the refund request with the relevant authority in his country of residence.
4. The reasons the Person bore the costs related to the refund request in the Kingdom.
5. A description of the costs to which the refund of Tax relates.

CHAPTER 17 - JUDICIAL OBLIGATIONS

Article 91
Powers of Judicial Officers

Judicial officers, in performing their duties as stipulated in Article 59 of the Law, shall carry out the following procedures:

Enter into a Taxable Person's Place of Business or any other places related to his business, including factories, warehouses, shops, wholesale or retail stores, enterprises and ships, for inspection and control for Tax purposes. Police officers may be used if necessary.
Access any Means of Transport used for transferring Goods subject to Tax.
Access books and records, examine documents (printed or electronic), request copies thereof and obtain the necessary information for the purpose of inspecting the Tax due and verifying the compliance of Taxable Persons.
Take or request a sample of any Goods found in any Means of Transport or a place used to store or transfer Goods subject to Tax.
Carry out all procedures to gather the necessary evidence to examine the extent of the registrant's compliance with the provisions of the Law and Regulations, including questioning any Person regarding any violation which relates to the application of the provisions of the Law and Regulations.
Record violations and prepare the necessary reports in the presence of the registrant or his representative, where possible. The procedures referred to may be carried out in the absence of the registrant or his representative, provided that he is subsequently notified of the procedures carried out in his absence.
Any procedures carried out shall be recorded in reports, and in particular the following:
1. Date, time and place of opening and closing a report.
2. Name and identity of the author of the report, and details of the order issued to assign him as a judicial officer.
3. Name and identity of the Person against whom procedures were carried out, whether that Person is the Registrant or his representative.
4. The result of examining the place where the Goods are stored or where the Taxable Services are provided.
5. Documents indicating the price, quantity and source of Goods sold.
6. Description of the violation.
7. Procedures carried out by the judicial officer.
8. The signature of the Registrant or his representative on the report, or proof of his refusal to sign if he is present.

CHAPTER 18 - ASSESSMENT OF NET TAX

Article 92
Decision to assess Net Tax

The Bureau shall issue its decision to assess the Net Tax if it is proven that the Taxable Person has incorrectly calculated Tax. The decision to assess and re-impose Tax shall include, at least, the following:
1. The reasons for the assessment, facts, information and legal basis for the reassessment.
2. The value of the Net Tax and the Tax differences due.
3. The due date for payment of Tax due after the Bureau's assessment.
The Bureau shall notify the Taxable Person of its decision to assess Net Tax specifying the date on which the Tax shall be paid.

Article 93
Re-assessment of Net Tax of periods previously examined

The Bureau shall not examine and re-assess Net Tax which relates to a Tax Period that has been previously examined, unless new information is discovered that was not available at the time of the previous examination and assessment, and this information requires reassessment.

Article 94
Means of notifying the Taxable Person of the Tax decision

The Bureau shall notify the Taxable Person of decisions issued by it relating to Tax matters by one of the following means:
1. By post to the address registered with the Bureau.
2. By way of e-mail to the e-mail registered with the Bureau.
3. Any other means specified by the Bureau.
The address for sending notices to the Taxable Person shall be his Place of Business or his Place of Residence in the Kingdom, or any address registered with the Bureau.
If a Taxable Person appoints a Tax Agent or Tax Representative to act on his behalf, a copy of the notification shall be sent to the Tax Agent or Tax Representative, as the case may be.
The date of receipt of the notice shall be considered the date on which the Bureau sent it to the Taxable Person or his Tax Representative.

CHAPTER 19 - GENERAL PROVISIONS

Article 95
Tax Appeals Review Committee

The Tax Appeals Review Committee shall appoint among its members at the first meeting, a deputy to the Chairman to replace him during his absence or where there is an objection to him being the Chairman. A secretary to the Committee shall be appointed by the Bureau to liaise with the departments concerned with the preparation and readiness of the Committee at the Bureau, to liaise with its members and to prepare meeting reports.
The Chairman of the Committee, his Deputy or its members shall not attend the hearing which looks into an objection or grievance submitted by any of their relatives to the fourth degree. The Chief Executive Officer of the Bureau shall select a replacement for the Person who was obliged not to attend in the event the Committee can not be convened in his absence.
The Committee shall notify the registered applicant of the grievance or the objection of the time for the hearing at least ten days prior to the hearing by means of the methods prescribed by Law, and may request him to present such data or documents it deems necessary. The registered applicant submitting the grievance or objection shall appear before the Committee by himself or by proxy.
Otherwise, the Committee may begin proceedings in his absence in light of the documents available to it.
The Committee's sessions shall be confidential and its meetings shall be held at the invitation of its Chairman or Deputy. The meeting shall not be valid unless the majority of its members are present, including either the Chairman or his Deputy. The Committee shall issue its recommendations further to a majority vote of the attendees. In the event of a tie, the Chairman shall have the casting vote.
The Committee may seek the assistance of any Person deemed appropriate including experts and specialists from the Ministry of Finance and National Economy, the Bureau or any other Governmental Body in its meetings, without such Persons having a vote in the deliberations.
For the acceptance of a grievance or objection submitted by the Taxable Person before the Tax Appeals Review Committee, and in accordance with the conditions stipulated in Article 66 of the Law, the follow shall be required:
1. Payment of the amount of Tax due where an objection to a Tax transaction has not been accepted.
2. Payment of the value of an administrative fine where the grievance relates to a decision to impose an administrative fine.
3. Payment of the prescribed fees.
The objection and grievance must contain at least the following information:
1. The name of the objector or complainant and the address of his or her Place of Business or postal address, and Tax Registration Number;
2. A summary of the application, legal basis and grounds for objection or grievance;
3. The Tax Period relating to the objection or grievance;
4. Documents and other information supporting the objection or grievance;
5. An e-mail address of the Tax Representative or Tax Agent of the objector or the complainant, if any.
The Committee shall keep the following records:
1. A record of Tax objections and grievances according to the date of their occurrence before the Committee. The record shall include the date relevant to each objection or grievance.
2. A record of meetings, during which Tax objections and grievances were brought before the Committee.
3. Any other records required by the nature of the work of the Committee.
The records shall be maintained by the technical secretariat of the Committee.

Article 96
Appointing a Tax Representative

A Non-Resident Person obliged to register in the Kingdom may appoint a Tax Representative in the Kingdom, who is licensed by the Bureau, by an application submitted to the Bureau on a form prepared for this purpose. The Tax Representative shall meet the conditions stipulated in Article 98 of these Regulations, and the Bureau shall issue its decision on the application for appointment within thirty days from the date of the submission of the application.
The Tax Representative shall be jointly liable with the Taxable Person for all Tax obligations of the latter, and shall replace him in the relationship with the Bureau from the date the Bureau approved his appointment as Tax Representative.
The Bureau shall be entitled to pursue the Tax Representative by legal means to collect Tax due by the Non-Resident Person.
Where the Tax representation has terminated because the Non-Resident Person ceased to carry out his activity in the Kingdom, the appointment of another Tax Representative, the termination of the representation term or any other reason, the Tax Representative shall remain subject to the obligations in the Law with respect to transactions made during the period of his legal representation until the date of termination.

Article 97
Appointing a Tax Agent

A resident Taxable Person may assign a Tax Agent licensed by the Bureau to act in his name and on his behalf in relation to his Tax obligations. The Tax Agent or the assigning Taxable Person must notify the Bureau of his appointment within thirty days of the date of appointment.
The Taxable Person appointing a Tax Agent shall be personally liable to the Bureau for all his Tax liabilities despite the appointment of a Tax Agent.

Article 98
Conditions of appointing a Tax Representative and Tax Agent

The Tax Representative or Tax Agent applicant must fulfill the following conditions:
1. He must be resident in the Kingdom.
2. He must be a Person of good conduct and reputation and must never have been sentenced to a restriction of freedom in a crime against honour.
3. Where the applicant is a natural Person, he should possess at least a university degree or an accounting or legal qualification, which shall be certified and approved by the Ministry of Education.
4. Where the applicant is a legal Person, he should carry out his activity under a valid and current commercial registration.
5. He must pay the fee prescribed by Bureau.
6. He must be appointed under an official power of attorney to act in the name of the registrant in respect of all Tax obligations in the Kingdom.
The Tax Representative or Agent must adhere to the following:
1. Keep information received from the Taxable Person confidential.
2. Refrain from planning or participating in acts that violate the Law or Regulations.
If the Bureau approves the licensing of the Tax Representative, a unique Tax Registration Number shall be assigned to him as a Tax Representative which differs from his Tax Registration Number as a Taxable Person. Where the application is rejected, the applicant shall be notified of the rejection of his application together with the reasons for the refusal.
The Taxable Person shall notify the Bureau of the removal or termination of the Tax Agent's or Tax Representative's duties within thirty days from the date of their removal or termination. The Bureau shall cease to deal with the Tax Agent or Tax Representative accordingly, and the Tax Agent or Tax Representative shall notify the Bureau that he has discontinued his agency or representation.

Article 99
Joint liabilities

Where the legal status of a legal Person has changed, the new legal Person shall replace the previous legal Person in all his previous and new rights and duties towards the Bureau including the payment of Tax due and any administrative fines due.
Where the legal Person is replaced by more than one legal Person, all legal Persons shall be jointly liable for the payment of Tax due and administrative fines.
Subject to the provisions of Article 11 of the Law, where the Taxable Person surrenders his business to another Person, the two parties shall be jointly liable for the payment of Tax due and any administrative fines during the year in which the surrender occurs, and are jointly liable for any amounts due from previous years that have not expired due to the statute of limitations.
Partners shall be jointly liable for Taxes, administrative fines and other obligations imposed on the company.

Article 100
Confidentiality of information

Employees of the Bureau and all those responsible shall adhere to the provisions of the Law and these Regulations and shall not disclose Tax information, during or after their employment, acquired or accessed through or due to their profession, with the exception of any of the following cases:
1. A request for such disclosure is required by a court order, or in accordance with the provisions of the Law or these Regulations or any other law in force in the Kingdom.
2. Disclosure is made to another employee of the Bureau acting in his official capacity, or to a Government Body in the Kingdom, or to a court or tax authority in a foreign country in accordance with any treaty to which the Kingdom is a party.
3. The issue of written approval from the Taxable Person permitting the disclosure.
The employees of the Bureau shall adhere to the following:
1. Only disclose information that is necessary.
2. Ensure that any documents are retrieved from official bodies in the Kingdom within a reasonable period of time.
The employees of the Bureau shall be prohibited from carrying out or participating in any Tax related procedures relating to a Taxable Person in the following cases:
1. The existence of a kinship up to the fourth degree between the employee and the Taxable Person.
2. The existence of any common interest between the employee and Taxable Person or between any of his relatives up to the fourth degree.

Article 101
Retention of records and accounting books

A Taxable Person shall keep and retain accounting books and records for Tax purposes, including all of the following:
1. Accounting books related to the Taxable Person's work (all of the transactions according to their chronological and numerical order).
2. Balance sheet and profit and loss account.
3. Records of salaries and wages.
4. Records of fixed assets.
5. Inventory records and accounts (including quantities and values) at the end of any relevant Tax Period.
6. A copy of Tax Invoices, credit and debit notes issued, and original Tax Invoices received by the Taxable Person.
7. All customs documents relating to import and export transactions carried out by the Taxable Person.
8. Additional records determined by the Bureau.
Taxable Persons must retain records and accounting books in a secure way to avoid their damage, and in a state where they can be read and reviewed.
A Tax Representative shall keep the records stipulated in Paragraph A of this Article.
A Tax Agent may keep the records stipulated in Paragraph A of this Article.
The Bureau reserves the right to request a Taxable Person to keep additional records, and shall notify the Taxable Person where the Bureau considers this necessary.

Article 102
Retention of records and accounting books electronically

A Taxable Person may retain records and accounting books electronically, if the following conditions are met:
1. Easy access and extraction of records and accounting books from the computer system upon the Bureau's request.
2. Ability to keep documents and records that support the records and the accounting books electronically or in hard copy.
3. Records and accounting books are kept securely where no tampering or manipulation can occur.
The Bureau has the right to review the computer system used by a Taxable Person to ensure its compliance with the provisions of the Law and these Regulations.

Article 103
Retention period of records and accounting books

The Taxable Person shall retain records and accounting books for a period of five years from the end of the Tax Period to which it relates.
Records related to Capital Assets shall be retained for a period of five years from the end of the Tax Period in which the adjustment period for such assets ends.
Records related to real estate shall be retained for a period of fifteen years from the end of the Tax Period to which they relate.
The Bureau may, before the expiry of the periods stipulated in this Article, notify the Taxable Person where there is a need to retain records for a further period, which shall not exceed five years.
If the Person is no longer a Taxable Person due to the transfer of ownership of the Economic Activity to another party or merging with another party, he shall still be obliged to retain records for the period preceding the transfer of ownership or the merger in accordance with the periods stipulated in this Article.
In the event of insolvency or bankruptcy of the Taxable Person, his Tax Representative shall be required to retain his records for a period not less than twelve months from the date on which insolvency or bankruptcy proceedings came to an end.

Article 104
Keeping and retaining records and accounting books by other Persons

A Taxable Person may appoint a third party to keep and retain records and accounting books in accordance with the Law and these Regulations. In all cases, the Taxable Person shall remain responsible for such documents.

Article 105
Language of records and accounting books

Records, accounting books and other documentation that are requested to be kept and retained shall be kept either in Arabic or English in accordance with the provisions of the Law and these Regulations.

Article 106
Calculation of deadlines

The Taxable Person shall submit Tax Returns and pay the Tax due to the Bureau, carry out the applications and Tax procedures within the legal deadlines specified in the Law and these Regulations.
When calculating deadlines, the date of the notification shall not form part of the period used to compute the specified deadline.
If the last day of the deadline falls on an official holiday, the deadline shall be extended to the next working day.
The Gregorian Calendar shall be the calendar used in all dates stipulated in the Law and these Regulations.

CHAPTER 20 - TRANSITIONAL PROVISIONS

Article 107
Supplies subject to Tax after the Law comes into force

Tax shall be due on the Supply of Goods and Services and on the import of Goods from the date the Law comes into force.
For the purposes of applying Article 75 of the Law, the date of Supply shall be regarded to be on or after the date the Law comes into force where any of the following cases occurs on or after the date the Law comes into force:
1. The start of the transport of Goods, if such transport is not under the Supplier's supervision.
2. The Goods are placed at the disposal of the Customer.
3. The completion of the installation or assembly of Goods, for Supplies inclusive of installation or the assembly.
4. The completion of a Service.

Article 108
Contracts exclusive of Tax signed before the Law coming into force

For the purposes of applying Article 76 of the Law, the Consideration shall be considered inclusive of Tax, and Tax shall be calculated according to the following formula:

Tax = Consideration x (Tax rate)/(100% + Tax rate)

Article 109
Transitional Tax Periods

Notwithstanding Paragraph A of Article 48 of these Regulations, for the first year, which shall commence on 1 January 2019 and end on 31 December 2019, transitional Tax Periods shall be calculated, in order to apply the provisions of the Law, as follows:

For Taxable Persons whose registration takes effect on the date the Law comes into force, and whose value of annual Supplies exceeds five million Dinars, all Tax Periods for the year beginning 1 January 2019 shall be on a quarterly calendar basis.
For Taxable Persons whose registration takes effect on the date the Law comes into force, and whose value of annual Supplies is not less than the Voluntary Registration Threshold, but does not exceed five million Dinars, the Tax Periods shall be as follows:
1. 1 January 2019 to 30 June 2019
2. 1 July 2019 to 30 September 2019
3. 1 October 2019 to 31 December 2019
For Taxable Persons whose registration takes effect after the Law comes into force but before 1 July 2019, the first Tax Period shall commence on the effective date of their registration and shall end on 30 June 2019, regardless of the value of their annual Supplies. The subsequent Tax Periods for such Persons during the year 2019 shall be:
1. 1 July 2019 to 30 September 2019
2. 1 October 2019 to 31 December 2019
For Taxable Persons whose registration takes effect on or after 1 July 2019, but before 1 October 2019, the first Tax Period shall commence on the effective date of their registration and shall end on 30 September 2019, regardless of the value of their annual Supplies. The subsequent Tax Period for such Persons during the year 2019 shall be on 1 October 2019 to 31 December of the same year.
For Taxable Persons whose registration takes effect on or after 1 October 2019 but before 31 December 2019, the first Tax Period shall commence on the date of their registration and shall end on 31 December 2019, regardless of the value of their annual Supplies.

Article 110
Payment of Tax due on imports during the transitional period

Tax due on Goods imported into the Kingdom during the transitional period in the first year from implementing the provisions of the Law from 1 January 2019 until 31 December 2019, shall be collected pursuant to the procedures, systems, and conditions set by the Bureau.

Article 111
Treatment of Non-Implementing States

The Bureau shall announce when it considers any Member State as an Implementing State for Tax purposes. Until an announcement has been made by the Bureau, a Member State shall be treated as a State outside the Council Territory for the purposes of applying the Tax.

CHAPTER 21 - FINAL PROVISIONS

Article 112
Exceptions to the effective scope

The provisions stipulated in Chapters Seventeen, Eighteen, Nineteen and Twenty of these Regulations shall not apply to military forces and security bodies operating in the Kingdom.

Furthermore, any other provisions of these Regulations shall not prejudice the necessary confidentiality requirements of the affairs of the aforementioned bodies.

Article 113
Delegation of duties

The Chief Executive Officer of the Bureau shall be authorized to issue decisions on imposing administrative fines and to file criminal proceedings for crimes of Tax evasion set out in Article 63 of the Law and in reconciliation of such crimes.

Article 114
Explanatory guides and Tax guidelines

The Chief Executive Officer of the Bureau shall issue explanatory guides, instructions and explanations necessary for the application of the provisions of the Law and the Executive Regulations to which the Bureau shall adhere, and the Taxable Person shall rely and use these as guidance when applying the provisions of the Law and these Regulations.

Contents

The Minister of Finance and National Economy:

The following has been decided: