English translation published by the NBR in its bilingual Regulations file (marked unofficial). The Arabic text published in the Official Gazette remains the legal reference in the event of any discrepancy.
For a pre-commencement contract whose Consideration excluded Tax, Law Article 76 treats that Consideration as Tax-inclusive. Tax is extracted as Consideration × Tax rate ÷ (100% + Tax rate).
Teams reviewing contracts signed before 1 January 2019 and performed after launch.
The Article prevents simply adding Tax above Consideration where the transitional rule deems it inclusive. First prove contract timing, Article 76 scope and the rate applicable when the historical Supply occurred.
Current text
Apply the transition formula
- 1
Evidence contract before commencement.
- 2
Confirm Article 76 applies.
- 3
Identify covered Consideration.
- 4
Use the rate applicable at historical Supply time.
- 5
Extract Tax rather than add it twice.
- 6
Document net and Tax.
Connected provisions
Official guides and tools
Connected Madar tools
BHD 1,050 at a 5% rate
If the transitional rule applies to BHD 1,050 and the applicable historical rate is 5%, extracted Tax is 1,050 × 5 ÷ 105 = BHD 50 and net Consideration is BHD 1,000. Another BHD 50 is not added above BHD 1,050.
Questions to help you apply it
- Contract date?
- Article 76 applies?
- Covered Consideration?
- Historical applicable rate?
- Tax extracted or duplicated?