Global Daily Tax News, Guernsey, Bahrain DTA Now Ratified, (Sep 26, 2025)

The Guernsey Government has enacted The Income Tax (Guernsey) (Approval of Agreement with Bahrain) Ordinance, 2025, to ratify the new double tax agreement signed with Bahrain.

Bahrain earlier ratified the agreement in April 2025.

The new agreement includes a preamble that states that the DTA is not intended to create opportunities for non-taxation or reduced taxation through tax evasion or avoidance, or treaty shopping. Further, the agreement includes provisions to counter treaty abuse, prevent the artificial avoidance of permanent establishment status, neutralize the effects of hybrid mismatch arrangements, and improve dispute resolution mechanisms.

Further, the treaty waives tax at source on dividends income, interest income (income from debt-claims in Bahrain), and for royalties.