Bahrain
Last reviewed: 21 August 2026 · Primary sources: National Bureau for Revenue, LMRA and SIO
Country facts at a glance
- Currency: BHD — pegged at 0.376 per USD
- VAT: 10% standard rate
- Corporate tax: No general corporate income tax
- Global minimum tax: 15% domestic minimum top-up tax for in-scope MNE groups
- Personal income tax: None
- End of service: Employer lump sum for service before 1 March 2024; monthly SIO contributions after
- SIO end-of-service rate: 4.2% of the relevant wage for the first three years, 8.4% thereafter
- Social insurance: Bahraini nationals 8% employee, 18% employer in 2026; expatriates 4% total (3% / 1%)
- Minimum wage: BHD 300 for Bahraini nationals in the public sector only
- Notice period: 30 days minimum for indefinite contracts
Current decision alerts
- The SIO employer rate for Bahraini nationals rises one percentage point every January until 2028 — budget for it rather than repricing each year.
- The enhanced Wage Protection System became mandatory for private-sector employers in February 2026.
Practical country guidance
Banking & Money
Opening a Bahrain bank account
CPR, address proof and the onboarding sequence.
Wage Protection System obligations
What the 2026 enhanced regime requires from employers.
Financial services and the CBB framework
Why Bahrain remains a regional banking base.
Tax & Compliance
VAT registration and filing
Thresholds, returns and record-keeping under the NBR.
Domestic minimum top-up tax
Which groups are in scope and what the 15% floor means.
Excise tax on goods
Categories, rates and how excise stacks under VAT.
Visas & Residency
Work permits and LMRA process
Employer obligations, fees and permit validity.
CPR registration and renewal
Documents, timing and dependants.
Golden Residency eligibility
Investment, salary and property routes.
Business & Employment
Starting a business in Bahrain
Structure, licensing, ownership and post-setup registrations.
End-of-service under the SIO scheme
What changed in March 2024 and how the two periods are settled.
Leave, encashment and settlement
Why Bahrain settles leave balances during employment, not only on exit.
Useful calculators
VAT Calculator
End-of-Service Gratuity
Pillar Two Top-up Tax
Excise Tax
Employer Cost
Official portals
NBR
VAT registration, returns and payments
National Bureau for Revenue
LMRA
Work permits, WPS and expatriate labour records
Labour Market Regulatory Authority
SIO
Social insurance and end-of-service benefits
Social Insurance Organisation
Sijilat
Commercial registration and licensing
Ministry of Industry & Commerce
Frequently asked questions
Does Bahrain have corporate tax?
There is no general corporate income tax. Hydrocarbon activity is taxed separately, and a 15% domestic minimum top-up tax applies to large multinational groups.
Who pays my end-of-service benefit now?
For service from 1 March 2024 the SIO pays it, funded by monthly employer contributions. Service before that date remains an employer lump sum.
What are the SIO end-of-service rates?
4.2% of the relevant wage for an employee’s first three years of service, then 8.4% thereafter, remitted monthly. SIO states the gratuity basis is basic salary plus social allowance, if any.
Is there a minimum wage in the private sector?
No. The BHD 300 figure applies to Bahraini nationals in the public sector. Private-sector pay is negotiated, though work-permit rules set a practical floor.
What is the VAT rate?
10%, raised from 5% in 2022 — the second highest in the GCC after Saudi Arabia.
How this page is maintained
General information only. Confirm current rules with the relevant authority.