Bahrain Guidance on VAT for Cryptocurrencies

The National Bureau for Revenue ("NBR") in Bahrain released a clarification on the VAT treatment of cryptocurrency transactions on 01 January 2022.

Payment Tokens

• Outside the scope of VAT 
• VAT Exempt

Utility Tokens

• Treated the same with single-purpose or multipurpose vouchers

Asset Tokens

• Exempt supply unless supplied for an additional explicit fee, commission, or commercial discount above the market value of the token.

Hybrid Tokens

• Determined on a case-to-case basis and may represent a single composite supply or multiple supplies of goods and/or services.

OTHER GCC COUNTRIES:

UAE, KSA and Oman

• No guidance issued by Tax Authorities on cryptocurrency transactions in this countries

Kuwait and Qatar

• VAT has not yet been implemented in these two countries.

How can Crowe help?

VAT treatment on cryptocurrency transactions is highly uncertain and subject to interpretation and Crowe can assist taxpayers analyze and determine the correct VAT treatment of such transactions to ensure compliance with existing VAT rules.