Bahrain is an island nation located in the Persian Gulf, with a rich history and culture and a growing economy. With its capital Manama, Bahrain has a population of just over 1.5 million, while the capital has a population of around 160,000. Bahrain's economy is expected to make steady progress in the coming years. GDP is expected to grow by 2.9% in 2021, while in 2022, it is expected to grow by 2.7%. Data on the growth of this country, as well as the opportunities it provides for venturing into sole proprietorship show us why we should consider starting up a business in Bahrain. In this article, we will go through the process of registering a sole protectorship in Bahrain.
Disclaimer: Be aware that this article is not a substitute for legal advice. Please always check official websites or seek legal advice before you take action.
Sole proprietorship in Bahrain
If you want to start your own business, a sole proprietorship is the best option for you because the procedure is simple and the establishment costs are low. The benefits of establishing a proprietorship school in Bahrain are:
- Complete control over the business
- The establishment procedure is straightforward and accessible
- There can be only one owner, and having a partner is not required
- Low initial costs
How to register a sole proprietorship in Bahrain
The registration procedure is not complicated, and the documents and steps to be completed are the following:
- Choose your company name ( the company name must be different from other legal entities registered in Bahrain)
- The completed form with all personal and professional data should be submitted to the Ministry of Industry, Commerce, and Tourism (MOICT). The form must be submitted in-person to the Ministry of Industry, Commerce, and Tourism.
- Article of Association (AOA)- a certified article by the ministry should then be notarized.
- Commercial Registration requirements - a person should be at least 18 years old, of sound mind, dedicated to his business, free from any criminal record.
- Final Approval - After AOA, you have to submit all the documents attached with a proper business plan to the Ministry of Industry, Commerce, and Tourism. The final approval process takes two weeks, and once approved, you are ready to start your business.
Taxpayer and VAT registration in Bahrain
Value Added Tax (VAT) is 5%, and the registration process is not complicated and can be done online. Any business in Bahrain that has supplies greater than 18,500 BHD must be registered as long as businesses whose supplies do not exceed 18500 BHD can be registered on a voluntary basis. Non-residents (without a fixed place of business or a fixed place of business) are required to register for VAT in Bahrain within 30 days of the first taxable supply to non-taxable persons in Bahrain, regardless of the above thresholds.
First of all, you have to create a profile in NBR( National Bureau for Revenue) and fill the form. If your NBR profile is approved, you will be provided with login details to access the registration form. Once approved by the NBR, the VAT certificate will be available on your NBR profile.