Bahamas VAT

Section 1 — Quick reference

Quick reference table

Field	Value
Country	The Bahamas (Commonwealth of The Bahamas)
Standard rate	10%
Reduced rate	5% (food in food stores from April 2025; medications, diapers, hygiene from September 2025)
Zero rate	0% (exports, international transport)
Exempt	Financial services, residential rent, education, medical, public transport
Return form	VAT return (frequency based on turnover)
Filing portal	https://inlandrevenue.finance.gov.bs
Authority	Department of Inland Revenue (DIR)
Currency	BSD (Bahamian Dollar, pegged 1:1 to USD)
Filing frequencies	Monthly (>BSD 5M), Bimonthly (BSD 400K–5M), Quarterly (BSD 100K–400K), Annual (voluntary)
Deadline	21st of the month following the period
Registration threshold	BSD 100,000 mandatory; BSD 50,000 voluntary
No income tax	The Bahamas has NO income tax of any kind
Companion skill	vat-workflow-base v0.1 or later — MUST be loaded
Validated by	Pending local practitioner validation

Conservative defaults

Ambiguity	Default
Unknown rate on a sale	10%
Unknown VAT status of a purchase	Not deductible
Unknown counterparty location	Domestic Bahamas
Unknown food classification (store vs restaurant)	10% (restaurant/prepared)

Red flag thresholds

Threshold	Value
HIGH single-transaction size	BSD 10,000
HIGH tax-delta on a single default	BSD 500

Section 2 — Required inputs and refusal catalogue

Required inputs

• Minimum viable input — bank statement for the period. Acceptable from: CIBC FirstCaribbean, RBC Bahamas (Royal Bank), Scotiabank Bahamas, Commonwealth Bank, Fidelity Bank, or any other. (Section 2 — Required inputs and refusal catalogue)

Bahamas-specific refusal catalogue

• R-BS-1 — Grand Bahama Freeport — Trigger: client operates within Grand Bahama Port Authority area. Message: "Freeport operations under the Hawksbill Creek Agreement have special VAT provisions requiring specialist analysis. Please escalate." (R-BS-1)
• R-BS-2 — Investment fund structures — Trigger: client is an investment fund. Message: "Investment fund VAT treatment requires specialist analysis. Please escalate." (R-BS-2)

Section 3 — Supplier pattern library

3.1 Bahamian banks (fees exempt — exclude)

Bahamian banks pattern table

Pattern	Treatment	Notes
CIBC FIRSTCARIBBEAN, CIBC FC	EXCLUDE for bank charges	Financial service, exempt
RBC BAHAMAS, ROYAL BANK	EXCLUDE for bank charges	Same
SCOTIABANK BS, COMMONWEALTH BANK	EXCLUDE for bank charges	Same
FIDELITY BANK	EXCLUDE for bank charges	Same
INTEREST, LOAN, REPAYMENT	EXCLUDE	Out of scope

3.2 Government (exclude)

Government pattern table

Pattern	Treatment	Notes
DIR, DEPT INLAND REVENUE	EXCLUDE	Tax payment
CUSTOMS, BAHAMAS CUSTOMS	EXCLUDE	Duty (import VAT separate)
BUSINESS LICENCE, BL FEE	EXCLUDE	Government fee
NIB, NATIONAL INSURANCE	EXCLUDE	National insurance

3.3 Utilities

Utilities pattern table

Pattern	Treatment	Notes
BPL, BAHAMAS POWER AND LIGHT	Domestic 10%	Electricity
WSC, WATER AND SEWERAGE	Domestic 10%	Water
BTC, BAHAMAS TELECOMMUNICATIONS	Domestic 10%	Telecoms
ALIV	Domestic 10%	Mobile

3.4 Insurance (exempt — exclude)

Insurance pattern table

Pattern	Treatment	Notes
BAHAMAS FIRST, COLINA, J.S. JOHNSON	EXCLUDE	Exempt
SUMMIT INSURANCE	EXCLUDE	Same

3.5 SaaS and international services

SaaS pattern table

Pattern	Treatment	Notes
GOOGLE, MICROSOFT, META, AWS	Self-assess 10% (reverse charge)	Non-resident
ZOOM, SLACK, CANVA	Self-assess 10%	Same

3.6 Tourism

Tourism pattern table

Pattern	Treatment	Notes
HOTEL, RESORT, ATLANTIS	Domestic 10% (output)	Tourism supply
BOOKING.COM, EXPEDIA, AIRBNB	Platform fee — verify entity	May require reverse charge

3.7 Payroll and exclusions

Payroll pattern table

Pattern	Treatment	Notes
SALARY, WAGES	EXCLUDE	No income tax; outside VAT scope
OWN TRANSFER, INTERNAL	EXCLUDE	Internal
DIVIDEND	EXCLUDE	No income tax
CASH WITHDRAWAL	TIER 2 — ask	Default exclude

Section 4 — Worked examples

Example 1 — Standard domestic sale at 10%

Input line: 05.04.2026 ; NASSAU TRADING CO ; CREDIT ; Invoice BS-041 ; BSD 1,100

Reasoning: Domestic. 10%. Net = BSD 1,000, VAT = BSD 100.

Example 1 result table

Date	Counterparty	Gross	Net	VAT	Rate	Field	Default?	Excluded?
05.04.2026	NASSAU TRADING CO	+1,100	+1,000	100	10%	Output	N	—

Example 2 — Food in food store at 5% (from April 2025)

Input line: 10.04.2026 ; SUPER VALUE FOOD STORE ; DEBIT ; Groceries ; BSD -105

Reasoning: Food in food store, reduced 5% rate from April 2025. Net = BSD 100, VAT = BSD 5.

Example 2 result table

Date	Counterparty	Gross	Net	VAT	Rate	Field	Default?	Excluded?
10.04.2026	SUPER VALUE FOOD STORE	-105	-100	5	5%	Input	N	—

Example 3 — Export, zero-rated

Input line: 15.04.2026 ; US BUYER INC ; CREDIT ; Exported conch ; BSD 5,000

Example 3 result table

Date	Counterparty	Gross	Net	VAT	Rate	Field	Default?	Excluded?
15.04.2026	US BUYER INC	+5,000	+5,000	0	0%	Zero-rated	N	—

Example 4 — Non-resident service (reverse charge)

Input line: 18.04.2026 ; US CONSULTING FIRM ; DEBIT ; Advisory ; BSD -3,000

Reasoning: Reverse charge. Self-assess 10% output = BSD 300. Claim input BSD 300 if fully taxable.

Example 4 result table

Date	Counterparty	Gross	Net	VAT	Rate	Field	Default?	Excluded?
18.04.2026	US CONSULTING FIRM	-3,000	-3,000	300	10%	Output + Input	N	—

Example 5 — Bank charges, excluded

Input line: 30.04.2026 ; CIBC FIRSTCARIBBEAN ; DEBIT ; Monthly fee ; BSD -25

Example 5 result table

Date	Counterparty	Gross	Net	VAT	Rate	Field	Default?	Excluded?
30.04.2026	CIBC FIRSTCARIBBEAN	-25	—	—	—	—	N	"Exempt"

Section 5 — Tier 1 classification rules (compressed)

5.1 Standard rate 10% — Default for most taxable supplies.

• Standard rate — 10% (5.1 Standard rate 10% — Default for most taxable supplies.)

5.2 Reduced rate 5% — Food in food stores (from Apr 2025), medications, diapers, hygiene products (from Sep 2025). Moving to 0% for unprepared food from April 2026 — verify.

• Reduced rate — 5% (food in food stores from Apr 2025, medications, diapers, hygiene products from Sep 2025); moving to 0% for unprepared food from April 2026 — verify. (5.2 Reduced rate 5%)

5.3 Zero rate — Exports, international transport.

• Zero rate — 0% for exports, international transport. (5.3 Zero rate — Exports, international transport.)

5.4 Exempt — Financial services, residential rent, education, medical, public transport.

• Exempt categories — Financial services, residential rent, education, medical, public transport. (5.4 Exempt)

5.5 Input tax credit — Available on purchases for taxable supplies. Apportionment if mixed.

• Input tax credit — Available on purchases for taxable supplies. Apportionment if mixed. (5.5 Input tax credit)

5.6 Blocked input — Entertainment, personal vehicles, personal consumption.

• Blocked input — Entertainment, personal vehicles, personal consumption. (5.6 Blocked input)

5.7 Imports — VAT at 10% on CIF plus duties. Paid at customs.

• Imports — VAT at 10% on CIF plus duties. Paid at customs. (5.7 Imports)

5.8 Reverse charge — Non-resident services: self-assess 10%. Claim input if for taxable supplies.

• Reverse charge — Non-resident services: self-assess 10%. Claim input if for taxable supplies. (5.8 Reverse charge)

5.9 No income tax — The Bahamas has no income tax. VAT is primary revenue source.

• No income tax — The Bahamas has no income tax. VAT is primary revenue source. (5.9 No income tax)

Section 6 — Tier 2 catalogue (compressed)

6.1 Food classification — Default: 10% unless in food store. Question: "Is this food in a food store (5%) or prepared food/restaurant (10%)?"

• Food classification default — Default: 10% unless in food store. Question: "Is this food in a food store (5%) or prepared food/restaurant (10%)?" (6.1 Food classification)

6.2 Freeport operations — Default: refuse (R-BS-1).

• Freeport operations default — Default: refuse (R-BS-1). (6.2 Freeport operations)

6.3 Tourism sector — Default: 10%. Question: "Hotel occupancy tax separate from VAT?"

• Tourism sector default — Default: 10%. Question: "Hotel occupancy tax separate from VAT?" (6.3 Tourism sector)

6.4 SaaS entities — Default: self-assess 10%.

• SaaS entities default — Default: self-assess 10%. (6.4 SaaS entities)

6.5 Cash withdrawals — Default: exclude.

• Cash withdrawals default — Default: exclude. (6.5 Cash withdrawals)

Section 7 — Excel working paper template

Per vat-workflow-base Section 3, with Bahamas fields: Output 10%, Output 5%, Zero-rated, Exempt, Input domestic, Input imports, Net VAT.

Section 8 — Bank statement reading guide

CIBC FirstCaribbean and RBC exports CSV/PDF. BSD primary (= USD). Internal transfers: exclude. No foreign currency conversion needed for USD (BSD pegged 1:1).

Section 9 — Onboarding fallback

9.1 TIN — "What is your DIR TIN?"

• TIN question — "What is your DIR TIN?" (9.1 TIN)

9.2 Filing frequency — Based on turnover. "Annual turnover bracket?"

• Filing frequency question — Based on turnover. "Annual turnover bracket?" (9.2 Filing frequency)

9.3 Industry — "What does the business do?"

• Industry question — "What does the business do?" (9.3 Industry)

9.4 Exports — "Do you export?"

• Exports question — "Do you export?" (9.4 Exports)

9.5 Freeport — "Are you in Grand Bahama Freeport?" (If yes, R-BS-1 fires.)

• Freeport question — "Are you in Grand Bahama Freeport?" (If yes, R-BS-1 fires.) (9.5 Freeport)

9.6 Credit brought forward — Always ask.

• Credit brought forward — Always ask. (9.6 Credit brought forward)

Section 10 — Reference material

Sources

1. Value Added Tax Act 2014 (as amended). 2. DIR guidelines. 3. Rate history: 7.5% (2015), 12% (2018), 10% (2022), 5% reduced (2025).

Known gaps

1. Freeport refused. 2. Food 0% transition (April 2026) — verify current status. 3. No income tax confirmation must be stated clearly.

Change log

• v2.0 (April 2026): Full rewrite to Malta v2.0 ten-section structure.

Disclaimer

This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. All outputs must be reviewed by a qualified professional before filing.

The most up-to-date version is maintained at openaccountants.com.

Disclaimer

This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this skill. All outputs must be reviewed and signed off by a qualified professional (such as a CPA, EA, tax attorney, or equivalent licensed practitioner in your jurisdiction) before filing or acting upon.

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