English translation published by the Legislation and Legal Opinion Commission. The Arabic text published in the Official Gazette remains the legal reference in the event of any discrepancy.
With NBR approval, qualifying Goods may be taxed on the profit margin instead of full selling value. The Regulations define eligible Goods, sellers, invoicing and records.
Dealers in used movable Goods, artwork, antiques and items of scientific, historical or archaeological importance.
The margin scheme is not an automatic accounting choice. It requires approval and qualifying Goods and source; the margin is VAT-inclusive and Input Tax on the Goods is not deducted. Under section 17 of General Guide v1.16, updated 20 September 2026, prior VAT treatment in Bahrain must be evidenced. Goods never previously subject to VAT, including stock acquired before the Law took effect, cannot use the scheme; VAT applies to their full selling price under the applicable treatment.
Current text
Can the margin scheme be used?
- 1
Obtain NBR approval before use.
- 2
Confirm the Goods are in an eligible category.
- 3
Confirm the seller's status and that no prohibited Input Tax deduction arises.
- 4
Retain prior-VAT evidence, such as a purchase invoice or customs declaration; without evidence the scheme cannot apply.
- 5
State margin-scheme use on the invoice without showing a VAT amount, and keep separate records.
Connected provisions
Official guides and tools
Used Goods bought from an unregistered Person
An approved dealer may qualify to apply VAT to the difference between sale and purchase price for used Goods acquired from an unregistered Person, subject to all Regulation conditions and evidence of prior VAT treatment in Bahrain. Purchase from an unregistered seller alone does not establish eligibility.
Questions to help you apply it
- Has the NBR approved the scheme?
- Do the Goods and purchase source qualify?
- Do the invoice and records clearly disclose the scheme?