Bahrain Personal Income Tax

No income taxes are currently imposed on individuals in Bahrain.

Other taxes

Except for tax imposed on companies involved in qualified oil and hydrocarbon activities, Bahrain levies no taxes on capital gains, sales, estates, interest, dividends, royalties or fees. No withholding tax is imposed in Bahrain.

Social security

The following social security contributions are payable on basic salary and recurring constant allowances on a monthly basis.

Contribution Rate (%)
For Bahrainis
Social insurance contributions (pension fund)
Employer’s contribution 9
Employee’s contribution 6
Insurance against employment injuries; paid
by employer
3
Unemployment insurance; paid
by employee
1
For expatriates
Insurance against employment injuries; paid
by employer
3
Unemployment insurance; paid
by employee
1

The above rates apply up to an income ceiling of BHD4,000 per month. No contributions are payable for income above this ceiling.

Effective January 2016, the Ministry of Health charges an annual health insurance fee of BHD22,500 for each Bahraini employee. The fee is paid through the Social Insurance Organization of Bahrain.

Visas

Nationals of Gulf Cooperation Council (GCC) member countries (Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates) do not require visas to visit Bahrain.

Business visas. Since April 2015, business visas issued online or at the Nationality Passport and Residence Affairs headquarters are valid for up to one month. The visa is valid for multiple entries, with two weeks being the maximum allowing time spent in Bahrain in one visit.

Visas on arrival. The Bahraini government has recently made changes to the visa on arrival procedures. Effective from 1 October 2014, nationals of 66 countries are eligible for a visa on arrival in Bahrain. The visa on arrival is extended to nationals of certain European countries as well as to certain South and Central American countries. Visitors from an additional 113 countries may apply for e-visas through a simple online pro­cess before traveling. Non-nationals with GCC residency and a designation of manager or above can obtain a visa on arrival at Bahrain Airport.

The cost and duration of visas on arrival and e-visas vary depend­ing on the traveler’s nationality. Since April 2015, visitors apply­ing for an e-visa or who obtain a visa on arrival are issued multi­ple-entry visas typically for a duration of two weeks (renewable up to three months). Certain privileged rules apply to passport holders from Canada, Ireland, the United Kingdom and the United States.

To avoid inconvenience, it is suggested that visitors always check with the nearest Bahraini embassy or seek professional advice before traveling to Bahrain. To check eligibility and to apply for the above visas, please visit http://www.evisa.gov.bh/.

Work and residence permits

To work in Bahrain, all expatriates must have a valid work permit. To be allocated a number of work visas, an entity that will be employing expatriates must satisfy all of the following conditions:

  • It must be established in Bahrain.
  • It must be registered with the Labor Market Regulatory Authority (LMRA).
  • It must have a certain percentage of Bahraini workers (between 5% and 50%, depending on the industry).

The following documents are normally required to apply for a work visa:

  • Copy of passport (validity of a minimum of six months)
  • Pre-employment medical certificate as per the LMRA guide­lines, showing that the employee is fit to work
  • Signed offer letter or contract
  • Copy of diploma or qualifications
  • Copy of marriage certificate (if applicable)

The LMRA takes approximately 10 working days to process the visa application. After processing, the LMRA publishes the visa status online. Each applicant is allocated an application identification and the visa status can be checked online through the LMRA website.

Before the employer proceeds with the visa application, it is sug­gested that the employee inform the future employer as to whether he or she previously worked in Bahrain. This ensures that he or she is not given a duplicate personal identification card (Smartcard). In addition, the employee should inform the employer as to whether he or she holds a current valid Bahraini visa, such as a multiple re-entry business visa. To avoid the dis­ruption of the application process, it is suggested that the pro­spective employee not enter Bahrain before the visa is finalized.

After the employee enters the country, another medical exam needs to be carried out to confirm that the employee is fit to work. On completing all the above and providing proof of an address in Bahrain, an expatriate employee can obtain the Smartcard.

Family and personal considerations

Family members. The employee must obtain the Bahrain work permit (which also serves as the employee’s residence permit) before the employee’s family members can obtain Bahrain resi­dence permits.

The following documents and information is required for a fam­ily visa (that is, Bahrain residence permit):

  • Copy of employee’s passport with valid Bahraini residence permit stamp
  • Copy of the employee’s contract
  • Copy of the identification pages of the family member(s) passport(s)
  • Copy of the marriage certificate for the spouse
  • Copy of the birth certificate for each child (children must be under 18 years of age)

After the residence permit is issued, each family member needs to obtain the Bahrain identity card (Smartcard).

Each family member needs to provide the following documents to obtain the Smartcard:

  • Original passport
  • Sponsorship letter stating names of dependents
  • One passport-size photograph
  • Marriage certificate for spouse and birth certificate for the children
  • Copy of electricity bill or letter from the local area municipal­ity confirming the address

Driver’s permits. Bahrain has driver’s license reciprocity with all of the GCC member countries.

A Bahraini driver’s license can be obtained from the General Directorate of Traffic. In addition, citizens of certain countries can exchange their home countries’ driver’s licenses for Bahraini-issued driver’s licenses without taking the driving evaluation tests.