TaxFlash has been designed to keep our clients and contacts up-to-date with relevant tax developments. Please contact the Keypoint tax team if you have any questions about anything covered in this TaxFlash. Click here if you'd like to be added to our mailing list.
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Bahrain:
- The Ministry of Industry and Commerce (MoIC) has issued an official letter to MOIC-regulated entities confirming that the deadline for submission of economic substance (ES) returns for FY 2021 is 11 November 2022 - next Friday.
- The National Bureau for Revenue (NBR) will be hosting a virtual workshop on 28 November 2022 on basic VAT concepts.
- The president of Bahrain Customs Affairs, Shaikh Ahmed bin Hamad Al Khalifa recently received the general manager of SMSA Express to discuss expansion plans.
- Bahrain Customs Affairs participated in the 2022 World Customs Organization (WCO) Technology Conference and Exhibition.
- A delegation from Bahrain Customs Affairs recently visited the Zakat, Tax and Customs Authority (ZATCA) Academy in Saudi Arabia to explore ways to enhance cooperation.
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Saudi Arabia:
- The Zakat, Tax and Customs Authority (ZATCA) has issued (in Arabic) simplified zakat collection guidelines.
- ZATCA has announced the names of companies eligible to compete in the allocation of customs areas at six of Saudi Arabia’s land ports.
- ZATCA is hosting a variety of virtual workshops in November 2022.
- ZATCA has reminded taxpayers that there are now less than 30 days left to take advantage of its ongoing amnesty scheme.
- Another four companies have been added to ZATCA's priority programme.
- Many taxpayers with annual revenues under SAR3m have received messages on their ZATCA profile stating that they are eligible for an e-invoicing subsidy.
- ZATCA's commissioner recently received a delegation from the South Korea’s customs authority to discuss bilateral relations.
- Senior leaders from Keypoint's tax team will be speaking at an IMA-hosted event at the King Fahd University of Petroleum and Minerals on 5 December. See below for more details.
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Qatar:
- The General Tax Authority (GTA) has announced that taxpayers can visit their Lusail office during the FIFA 2022 World Cup if they have any requests or inquiries.
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Upcoming event:
Our tax leaders - in conjunction with the Eastern Province's chapter of the Institute of Management Accountants (IMA) - will be discussing the future of tax in Saudi Arabia, the second phase of ZATCA's fatoorah project, transfer pricing in Saudi Arabia and tax controversies at the KFUPM Business School (KBS) at Dhahran TechnoValley on Monday 5 December. Join us for some interesting, timely conversations - as well as networking with old and new friends! More details to follow!
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Technical tip | Bahrain
Special input tax apportionment methods
In last week's TaxFlash, we looked at the default input tax proportional deduction method outlined in Article 59 of Bahrain’s VAT executive regulations (VAT ERs). Article 59 of the VAT ERs also allows a taxable person to use a special proportional deduction method if they can show that the special method - in the light of their economic activity - recovers input tax more "fairly and reasonably" than the default method. Special methods can be based on factors such as transaction counts, floorspace or headcount. Special methods can only be used once approved by Bahrain’s tax authority, the National Bureau for Revenue (NBR).
With the recent doubling of the standard rate of VAT (from 5% to 10%) in Bahrain, partially-exempt businesses are having to deal with additional input VAT costs. Key decision-makers looking to optimise costs may wish to apply to use a special proportional deduction method that can boost input VAT recovery while still being seen by the NBR as fair and reasonable.
If you have any questions on special proportional deduction methods or wish to explore VAT optimisation opportunities, please contact Keypoint’s tax team.
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