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Oman - Overview and introduction

Tax TIES: Oman - Overview and introduction

Taxation of international executives

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Riyam Park Monument, Muscat, Oman

For individuals, the Sultanate of Oman does not levy any taxes on personal income, including income from capital gains, wealth, death or property. No personal income tax is levied on the income of residents or non-resident individuals. Foreign persons including individuals could be subject to withholding tax at a rate of 10 percent if the payments (which are specified) representing income is realized in Oman to foreign persons not carrying on activities in Oman through a PE.

There are no foreign exchange restrictions or levies.

Taxation in Oman is levied, broadly on taxable income at 15 percent, on businesses and companies. Small taxpayers are entitled to a lower rate of tax at 3 percent/Nil subject to conditions. Companies engaged in petroleum operations are subject to tax at 55 percent. Withholding tax is levied at the rate of 10 percent on specified payments to the foreign persons including individuals.

The Income Tax Law No. 28/2009, was promulgated on 1 June 2009. Under the said Income Tax Law, Oman moved to a global tax system replacing the territorial system of tax which was the basis of taxation under the previous Law of Income Tax. The Executive Regulations to the Income Tax Law detailing how certain provisions of the Tax Law are to be applied was issued by Ministerial Decision 30/2012 and became effective from 29 January 2012. Several changes were made to the Oman’s Tax Law by Royal Decree 9/2017 issued on 19 February 2017 by virtue of which tax rate was increased from 12 per cent to 15 per cent for financial years beginning 1 January 2017 and the scope of withholding taxes was significantly widened. An amendment to Executive Regulations have been recently introduced in February 2019 giving clarifications regarding applicability of withholding tax on various important matters along with other provisions relating to tax cards, tax inspection and taxation of small tax payers.

The official currency of Oman is the Omani rial (OMR) and, approximately, OMR1 is equal to 2.60 US dollars (USD).

© 2019 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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