Bahrain (BH)
A compact, English-friendly Gulf island state with no personal income tax, strong banking and professional services, liberal social norms by regional standards, and a practical base for Saudi Arabia via the King Fahd Causeway.
2026 Annual Changes — Bahrain
Updated thresholds, benefits, and regulatory changes effective this year.
Bahrain 2026 key changes: Golden Residency real estate investment threshold cut 35% to BD 130,000 (early 2026), employer social insurance pension contribution for Bahraini nationals raised to 11% from January 2026, LMRA work permit levy BD 195/year, VAT at 10%, SIO end-of-service for expats at 4.2%/8.4%. No minimum wage for expatriates in the private sector.
Key Changes for 2026
| Category | 2026 Value | Previous | Effective Date |
|---|---|---|---|
| Minimum Wage No statutory minimum wage for expatriates in Bahrain's private sector; Bahraini nationals in the public sector only | No minimum wage for private-sector expats. Bahraini nationals: BD 300/month (public sector only). All payments must comply with LMRA Wages Protection System (WPS). | Same — no expat private sector minimum wage | Ongoing |
| VAT Standard VAT rate unchanged at 10% | 10% standard VAT rate | 10% (raised from 5% in January 2022; unchanged since) | 1 January 2026 |
| VAT Registration Threshold Mandatory and voluntary VAT registration thresholds unchanged | Mandatory registration: BD 37,500 annual taxable supplies (rolling 12-month). Voluntary registration: BD 18,750 annual taxable supplies or expenses. | BD 37,500 mandatory / BD 18,750 voluntary (unchanged) | 1 January 2026 |
| Personal Income Tax No salary income tax for individuals in Bahrain | 0% — no personal income tax on employment or salary income | 0% (unchanged) | Ongoing |
| Corporate Tax — Pillar Two Minimum Tax Domestic minimum top-up tax for large multinationals in scope of Pillar Two rules | 15% effective minimum for in-scope MNE groups (annual global revenue ≥ EUR 750 million) | Not applicable (introduced 2025) | 1 January 2025 (in force 2026) |
| Social Insurance — Bahraini National Employee Contributions Pension contribution for Bahraini nationals raised from January 2026 under the annual escalation reform | Bahraini employee: 7% pension + 1% unemployment = 8% total. Bahraini employer: 11% pension + 1% unemployment = 12% total. (Employer pension rate rose from 10% to 11% in January 2026 under the annual 1% phased increase schedule.) | Employer pension 10% (2025); rising 1% per year under reform | 1 January 2026 |
| Unemployment Insurance — Expatriates Unemployment insurance contribution unchanged | 1% employee contribution + 1% employer contribution on gross salary | 1% employee (unchanged) | 1 January 2026 |
| SIO End-of-Service Gratuity — Expatriate Workers Employer-funded end-of-service contribution for non-Bahraini employees administered by SIO (Ministerial Decision 109/2023, effective March 2024) | Employer contribution: 4.2% of monthly salary for first 3 years of service; 8.4% for each subsequent year. Employer-only cost — no employee deduction. Employees with 3+ years as of March 1, 2024 were automatically moved to the 8.4% tier. | Previous lump-sum end-of-service scheme | 1 March 2024 (ongoing in 2026) |
| Employment Injury Insurance — Expatriates Employer SIO contribution for work injury insurance | 3% employer contribution on gross salary (employment injury insurance for non-Bahraini workers) | 3% (unchanged) | 1 January 2026 |
| LMRA Work Permit Levy Annual LMRA work permit fees for expatriate workers | New work permit: BD 195/year (1-year permit); BD 390 for 2-year permit. Renewal: BD 105/year (1-year); BD 210 (2-year). Administration fee: BD 5. Basic healthcare fee included (BD 90/year). Check lmra.gov.bh for current fee schedule. | Similar fees in 2025 | 1 January 2026 |
| Golden Residency — 10-Year Renewable Residence Real estate investment threshold cut 35% in early 2026; new income-based categories introduced | Real estate investment route: BD 130,000 minimum (reduced from BD 200,000 — approximately USD 345,000 at current peg). Employment route (5+ years in Bahrain): average salary BD 2,000+/month over last 5 years. Prior employment route (15+ years): pension BD 2,000+/month. International retiree route: BD 4,000/month income from overseas pension/investment. Check goldenresidency.gov.bh for full eligibility and documentation. | Real estate threshold was BD 200,000 | Early 2026 (real estate threshold reduction) |
| Registered Worker Route (LMRA) Workers using registered-worker arrangements must monitor eligibility, fees, and renewals | Route-specific LMRA fees and durations — check lmra.gov.bh for current category-specific rates and conditions. | — | 1 January 2026 |
| Digital ID — CPR and eKey eKey/CPR alignment remains central to all government online services | Keep CPR, mobile number, and eKey updated. CPR card required for LMRA services, banking, healthcare, and government portals. | — | 1 January 2026 |
| International School Fees International school fees for planning purposes | BD 1,500–7,000+ per year (varies widely by school and programme). Review fees and deposit requirements before September entry. | — | 1 September 2026 (academic year) |
| Ramadan Operations Government, school, restaurant, and work hours shift during Ramadan | Expected approximately 18 February – 19 March 2026 (subject to moon sighting). Working hours typically reduce to 6 hours/day during Ramadan for employees. | — | Approximately 18 February 2026 |
| Islamic Public Holidays Islamic holiday dates require official confirmation close to the event | Eid al-Fitr, Eid al-Adha, Hijri New Year, Ashoora, Mawlid — all dates subject to official moon sighting announcements. Download official government calendar once published. | — | 1 January 2026 |
| Bank KYC and CRS/FATCA Banks continue strict KYC/CRS/FATCA checks | Update tax residency declarations and expired CPR/passport details immediately. Large or unusual transfers require documentation. | — | 1 January 2026 |
| Summer Utilities AC-heavy months create highest electricity costs for tenants | Budget BD 30–180+/month for electricity depending on home size and whether included in rent. Confirm EWA (Electricity and Water Authority) inclusion in lease before signing. | — | May–September 2026 |
January Checklist
Actions to take each January when new rates take effect.
- 1
Check passport, CPR, residence permit, driving licence, and family visas for 2026 expiry dates.
- 2
Confirm with HR: current medical insurance card and SIO EOSG contribution confirmation (4.2% or 8.4% depending on tenure).
- 3
Review LMRA work permit validity and plan renewal 6–8 weeks in advance (BD 195 for 1-year renewal).
- 4
Update bank KYC, CRS/FATCA tax-residency declarations, and contact details.
- 5
Review rental renewal: confirm EWA (electricity/water) inclusion and summer utility budget.
- 6
Download Ramadan and public holiday calendar once official dates are announced.
- 7
If pursuing Golden Residency: note the real estate threshold was cut to BD 130,000 in early 2026 — consult an approved Bahraini legal adviser.
Where to Track Annual Changes
-
bahrain.bh — official government portal
-
lmra.gov.bh (LMRA) — work permit levy fees, registered worker rules
-
npra.gov.bh (NPRA) — CPR, residence, immigration
-
nbr.gov.bh (NBR) — VAT rates, registration, filing
-
sio.gov.bh (SIO) — end-of-service gratuity for expats, pension rates
-
mol.gov.bh (Ministry of Labour) — labour law, WPS
-
goldenresidency.gov.bh — Golden Residency eligibility and application
Bahrain has no personal income tax on employment income and no minimum wage for private-sector expatriates. The most significant 2026 regulatory change is the 35% reduction in the Golden Residency real estate threshold (to BD 130,000) which expands access to long-term residence for property investors. Official Gulf dates and fees can change with short notice — use government portals (lmra.gov.bh, nbr.gov.bh, sio.gov.bh) for final decisions before acting.
Annual Changes
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