Place of supply

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Place of supply

Mon Oct 15, 2018 11:46 am

What is the place of supply?
The place of supply is a component of supply that determines where a transaction has occurred for VAT purposes.

How is the place of supply determined for goods and services?
For a supply of goods, the place of supply is the location of the goods when the supply occurs. So, if the goods are located in the BAHRAIN during the supply, then they’re treated as supplied in the BAHRAIN and they are taxable under BAHRAIN VAT. If the goods are located outside the BAHRAIN during the supply, they’re treated as an out-of-scope supply. Special rules apply when there is a cross-border supply, a supply of water and energy, or a supply of real estate.

For a supply of services, the place of supply is the location of the supplier. Special rules apply when there is a cross-border supply between businesses or a supply of electronic services.

What is the place of supply for goods exported from the BAHRAIN to non-GCC member states?
If goods are exported from the BAHRAIN to a non-GCC member state, then the place of supply is the BAHRAIN.

What is the place of supply for goods exported from the UAE to other GCC member states?
If goods are exported from the BAHRAIN to other GCC member states, the place of supply depends on the VAT registration status of the recipient:
  • If the recipient is registered under VAT, then the place of supply is the final destination of the goods (i.e., the recipient’s state).
  • If the recipient is not registered under VAT, then the place of supply depends on whether the supplier exceeds the VAT export threshold:
  • If the total amount of exports by the supplier is below the mandatory registration threshold in the destination member state, the place of supply is the BAHRAIN, and BAHRAIN VAT must be paid.
  • If the total amount of exports by the supplier is above the mandatory registration threshold in the destination member state, the place of supply is the destination member state, and VAT should be paid in that state.
What is the place of supply for goods that involve installation or assembly?
The place of supply for goods that involve installation or assembly is the place where the installation or assembly takes place.

What is the place of supply for services that involve installation and assembly?
The place of supply for services that involve installation and assembly is the place where the installation is done.

What is the place of supply for services if the supplier resides in a GCC implementing state?
If a supplier residing in a GCC state supplies services to a VAT-registered recipient in another GCC state, the place of supply is the recipient’s state.

What is the place of supply for services if the supplier resides outside the GCC?
If a supplier residing in a non-GCC state supplies services to a recipient in the BAHRAIN, then the place of supply is the BAHRAIN.

What is the place of supply for water or energy distribution?
The place of supply for water or energy distribution is as follows:

  • If a taxable person who is a resident in the BAHRAIN makes a supply of water or energy to another taxable person who is a resident in another GCC member state, then the place of supply is the location of the recipient.
  • If a taxable person makes a supply of water or energy to a non-taxable person, the place of supply is the place of actual consumption.
What is the place of supply for restaurant, hotel and catering services?
The place of supply for restaurant, hotel and catering services is the place where the services are performed.

What is the place of supply for cultural, artistic, sporting, and educational services?
The place of supply for cultural, artistic, sporting and educational services is the place where the services are performed.

What is the place of supply for real estate services?
The place of supply for real estate services is the place where the real estate is located.

What is the place of supply for transportation services?
The place of supply for transportation services is the place where the transportation begins.

What is the place of supply for telecommunication and electronic services?
The place of supply for telecommunication and electronic services is the place where the services are used or received.

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