Oman

Corporate Tax in Oman – May 2025

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  • 1.

  • Standard Tax Rates

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    • Corporate taxremains 15% on taxable income. Omani owned SMEs with annual revenue below OMR 100,000 enjoy a 0% standard rate exemption.

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    • The oil & gas sector is taxed at a 55% rate.

  • 2.

  • Domestic Minimum Top-Up Tax – Pillar Two

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    • Royal Decree No. 70/2024, effective 1 Jan 2025, introduces both:

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      • A Domestic Minimum Top-Up Tax (DMTT) ensuring a minimum effective rate of 15% on Oman entities of large MNE groups.

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      • A Income Inclusion Rule (IIR) taxing foreign low-taxed profits at the Oman parent company level.

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    • Scope: Applies to MNE groups with consolidated global revenue ≥ €750 million in at least two of the last four years.

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    • Exemptions: Government entities, NPOs, pension funds, international organisations, and specific investment/real estate funds.

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    • Next Steps: Await implementing Regulations covering methodology, safe harbours (including Qualified Domestic Minimum Top-up Tax and transitional CbCR relief), compliance timelines.

VAT in Oman – May 2025

  • 1.

  • Standard Rates and Scope

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    • Standard rate: 5%

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    • Zero-rated: Exports, essentials, supplies to Free Zones

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    • Exempt: Healthcare, education, residential leases, other categories as per Royal Decree 121/2020.

  • 2.

  • Decision 81/2025 – Refund Extension

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    • On 20 April 2025, OTA issued Decision 81/2025, allowing Omani armed and security forces to claim VAT refunds on local purchases (ammunition, vehicles, equipment, parts).

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    • Adds to existing refund categories: tourists, charities, diplomats, re-exports, over-paid import VAT.

  • 3.

  • Refund Claim Process

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    • Frequency: Quarterly applications.

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    • Minimum claim: OMR 15.

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    • Required documents: VAT invoice (or simplified invoice) + proof of payment.

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    • Timeline:OTA decision within 30 days, payment within 15 days of approval.

  • 4.

  • E-invoicing Implementation Timeline

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    • OTA, in collaboration with Omantel, will roll out a PEPPOL-based e-invoicing platform:

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      • Q3 2025 : Planning & design

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      • Q1 2026 : Development/testing

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      • Q3 2026 : Mandatory for Top 100 taxpayers

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      • Q1 2027: Larger taxpayers

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      • Q3 2027: All taxpayers

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      • Q1 2028: G2B integration

Upcoming Deadlines to Monitor

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  • Q2 VAT return (Apr–Jun): Due 31 July 2025.

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  • VAT refund submissions: Quarterly, with next submission due by end July 2025

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  • Commencement of Pillar Two reporting: Timing to be clarified once Regulations are issued mid 2025

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