English text status

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.

Practical summary

Different VAT treatments in one transaction require price allocation; without allocation, the highest rate applies to total value. Collateral or deposited Goods sold use sale value. An unknown final value uses expected value then adjusts when finally agreed.

Who should read this?

Mixed packages, collateral sales and variable-price contract teams.

Why does it matter?

No supported allocation can increase VAT on the whole package. Initial estimate is not final; later agreed value requires adjustment.

Allocate priceOtherwise highest rateExpected then adjust

Current text

A. 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. B. 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. C. 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.

Control special value

  1. 1

    Identify components and treatment.

  2. 2

    Support commercial allocation.

  3. 3

    Calculate highest-rate risk if none.

  4. 4

    Use sale value for collateral.

  5. 5

    Document expected value.

  6. 6

    Issue correction when final.

Connected provisions

Direct legislative link

Regulations — Article (6)

Composite Supply

First decide one or multiple Supplies.

Open connected Article
Direct legislative link

Law — Article (20)

Value

This Article supplies special rules.

Open connected Article
Thematic link

Regulations — Article (54)

Correction

Final value change needs a corrective document.

Open connected Article

Official guides and tools

Official text

VAT Executive Regulations

Article (25)

Connected Madar tools

Connected Madar tools

Tax Invoice Centre

Check the invoice route and issue deadline, and calculate VAT for a single transaction.

Illustrative example by Madar

BHD 1,100 package with different components

A package includes a standard-rated device and another-treatment Service for BHD 1,100. Supported allocation applies each treatment; without allocation, the whole value faces the highest applicable rate.

Questions to help you apply it

  • Composite or components?
  • Allocated?
  • Highest rate?
  • Final value?
  • Adjusted when?