UAE vs Bahrain: construction business compared

The biggest differences: VAT 5% in UAE vs 10% in Bahrain; Employer — national 15% in UAE vs 18% in Bahrain; Employee — national 11% in UAE vs 8% in Bahrain.

Side by side

Item	UAE	Bahrain
Tax for Contractors
VAT	5%	10%
Corporate income tax	9%	—
Withholding on contractor payments	0%	0%
Zakat on companies	No	No
Tax authority	Federal Tax Authority (FTA)	National Bureau for Revenue (NBR)
Payroll & Social Insurance
Employer — national	15%	18%
Employee — national	11%	8%
Employer — non-national	0%	3%
Employee — non-national	0%	1%
Wage protection	Wage Protection System	Wage Protection System (LMRA)
Government Tenders
E-procurement platform	Digital Procurement Platform (DPP)	Tender Board e-Tendering
Bid bond	1% – 5%	1%
Performance bond	10%	10%
Retention	10%	10%
Registering a Contracting Company
Commercial registry	Each emirate's economic department (Dubai DET, Abu Dhabi ADDED) and free-zone authorities	Ministry of Industry and Commerce — Commercial Registration
Online registration portal	—	Sijilat
Chamber membership required	Yes	—
Contractor Classification
Required for government work	Yes	—
Classification authority	Per emirate: Dubai Municipality (Contractor Register); Abu Dhabi Department of Municipalities and Transport	Ministry of Works
Currency & Exchange Rate
Official currency	AED	BHD
Alternative currencies in use	None	None

— no documented figure in the sources, or set by each tender or contract. Withholding falls on payments to non-residents in most countries and on every contractor payment in a few — see each country’s tax page.