Share Deal vs Asset Deal
📊 Share Deal
• Transfer of shares — exempt from VAT
• No stamp duty in Bahrain
• Tax history transfers with company
• DMTT: inherits MNE group status
• CR continues — no MOIC re-filing
🏢 Asset Deal
• Transfer of assets — standard-rated VAT
• TOGC relief may apply (no VAT)
• Clean break from tax history
• DMTT: new entity assessment
• New CR and registrations required
TOGC Relief
Transfer of Going Concern: Where a business is transferred as a going concern, the transfer is treated as neither a supply of goods nor a supply of services — no VAT charged. Conditions: the buyer must be (or become) VAT-registered, and the business must be capable of operating independently.
Due Diligence Checklist
✅ Review target's VAT return history and assess outstanding liabilities
✅ Check for pending disputes or audit activity with NBR
✅ Assess Capital Goods Scheme positions on property and equipment
✅ Evaluate DMTT impact — does the acquisition create a Covered Group?
✅ Review employment contracts for GOSI and indemnity exposure