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June 26, 2026

This Agreement between Bahrain and Estonia for the avoidance of double taxation covers income taxes in both states. A key provision is the definition of a permanent establishment, which includes a building site or construction project lasting more than twelve months. The treaty establishes that dividends, income from debt claims (interest), and royalties arising in one state and beneficially owned by a resident of the other state are taxable only in that other state, resulting in a 0% source-state withholding tax. Both Bahrain and Estonia utilize the exemption with progression method to eliminate double taxation under Article 21.

Agreement between the Government of the KINGDOM OF BAHRAIN and the Government of the REPUBLIC OF ESTONIA for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income

Contents

Article 1 - Persons Covered

Article 2 - Taxes Covered

Article 3 - General Definitions

Article 4 - Resident

Article 5 - Permanent Establishment

Article 6 - Income from Immovable Property

Article 7 - Business Profits

Article 8 - Shipping and Air Transport

Article 9 - Associated Enterprises

Article 10 - Dividends

Article 11 - Income from Debt Claims

Article 12 - Royalties

Article 13 - Capital Gains

Article 14 - Income from Employment

Article 15 - Directors' Fees

Article 16 - Artistes and Sportsmen

Article 17 - Pensions

Article 18 - Government Service

Article 19 - Students

Article 20 - Other Income

Article 21 - Elimination of Double Taxation

Article 22 - Non-Discrimination

Article 23 - Mutual Agreement Procedure

Article 24 - Exchange of Information

Article 25 - Members of Diplomatic Missions and Consular Posts

Article 26 - Entry into Force

Article 27 - Termination

Article 1
Persons Covered

This Agreement shall apply to persons who are residents of one or both of the Contracting States.

Article 2
Taxes Covered

This Agreement shall apply to taxes on income imposed on behalf of a Contracting State or its local authorities, irrespective of the manner in which they are levied.
There shall be regarded as taxes on income all taxes imposed on total income or on elements of income, including taxes on gains from the alienation of movable or immovable property.
The existing taxes to which the Agreement shall apply are in particular:
1. in the case of Bahrain, the income tax payable under Amiri Decree No. 22/1979; and
2. in the case of Estonia, the income tax.
The Agreement shall apply also to any identical or substantially similar taxes that are imposed after the date of signature of the Agreement in addition to, or in place of the existing taxes. The competent authorities of the Contracting States shall notify each other of any significant changes that have been made in their respective taxation laws.

Article 1Persons Covered

Article 2Taxes Covered

Article 3General Definitions

Article 1
Persons Covered

Article 2
Taxes Covered

Article 3
General Definitions