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Bahrain’s NBR released revised VAT guidance clarifying when business transfers, including incorporation by natural persons, may qualify as a Transfer of a Going Concern (TOGC).
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If a VAT-registered individual incorporates their business and transfers assets to the new entity, the transaction may be VAT-exempt as a TOGC—subject to strict conditions and timely notifications.
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Failure to meet TOGC conditions requires VAT to be applied on each asset transferred, with the legal entity eligible to recover VAT if registered and meeting input VAT criteria.
Source: Orbitax
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