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Oman - Special considerations for short-term assignments

Special considerations for short-term assignments

Taxation of international executives

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Residency rules

Are there special residency considerations?  

An individual shall be a resident of Oman if they stay in Oman for 183 days or more continuously or intermittently during the relevant tax year.

Individuals visiting Oman on short term assignments or business meetings consider availing Business Visa, which is granted for a period of 21 days and need to be renewed thereafter.

For medium or long term assignments i.e. in the nature of employment or work, labor clearance and the appropriate work visa, together with applicable compliances have to be done.

Payroll considerations

Are there special payroll considerations?  

Oman does not have personal income tax so income tax does not apply for individuals except for the withholding tax on non-residents (who do not fulfil tax residency conditions discussed above) at the rate of 10 percent on the specified payments. Some of these specified payments include royalties, service fees, etc. 

Pension requirements and contributions

Social security contributions are not applicable for non-GCC nationals working in Oman. 

Taxable income

What income will be taxed?  

None for individuals except for the withholding tax at the rate of 10 percent (if such individuals do not fulfil the tax residency conditions) on the specified payments.

Additional considerations

Are there any additional considerations that should be considered before initiating an assignment in Oman?  

Provision of services in Oman for more than 90 days in a 12-month period triggers a PE of the foreign person in Oman, thereby bringing the foreign person to tax at the rate of 15 percent in Oman on the taxable income attributable to the PE. Hence, assignments exceeding 90 days in aggregate (viewed from the perspective of the foreign person) could trigger a PE risk for the foreign person in Oman.

 

Disclaimer

All information contained in this publication is summarized by KPMG LLC, the Oman member firm affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity, based on the Income Tax Law and Executive Regulations as on 18 October 2020. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

© 2021 KPMG, an Oman member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( “KPMG International”) A Swiss entity. KPMG and the KPMG logo are registered trademarks of KPMG International.

KPMG International Cooperative (“KPMG International”) is a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.

 

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