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

Annual Supplies include taxable Supplies other than Capital Assets, Deemed Supplies, relevant Intra-GCC Supplies, Related Person Supplies where aggregation applies, and Goods or Services received for which the Person must account for VAT. Forecast Supplies require a clear, supportable business plan.

Who should read this?

Business owners, accountants and anyone preparing the registration-threshold test.

Why does it matter?

Accounting sales alone may give the wrong result. Some values are added, others excluded, and reverse-charge purchases can move the test above the threshold.

Capital Assets excludedReverse charge includedSupported forecast

Current text

A. 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. B. 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.

Build the threshold calculation

  1. 1

    Classify standard-rated, zero-rated, exempt and outside-scope items.

  2. 2

    Exclude Capital Asset Supplies from this test.

  3. 3

    Add Deemed Supplies and Related Person values where aggregation applies.

  4. 4

    Add the value of reverse-charge Goods and Services, not merely the VAT amount.

  5. 5

    Support the next-twelve-month forecast with contracts, orders and a clear plan.

Connected provisions

Direct legislative link

Law — Article (29)

Mandatory registration

These values feed the Law's registration test.

Open connected Article
Direct legislative link

Regulations — Article (40)

Related Persons

It controls when Related Person Supplies are aggregated.

Open connected Article

Official guides and tools

Official text

VAT Executive Regulations

Article (34)

Official guide

VAT Registration Guide — Version 1.10

Registration, application, evidence and procedure

Connected Madar tools

Connected Madar tools

VAT Registration Centre

Check registration thresholds using your inputs, with mandatory, voluntary and uncertain cases distinguished.

Illustrative example by Madar

BHD 35,000 Supplies plus BHD 5,000 reverse charge

The indicator becomes BHD 40,000 where the BHD 5,000 service value must be accounted for under reverse charge. The amount added is the service value, not its 10% VAT.

Questions to help you apply it

  • Which accounting-revenue items were classified?
  • Were Capital Assets excluded?
  • Are reverse-charge or Related Person values present?
  • What supports the forecast?