Personal Income Taxation in Oman
There are no Personal Income Taxes levied in Oman.
Corporate Income Taxation in Oman
Under the Corporate Tax regime in Oman, worldwide income is used in order to calculate Corporate Income Tax. This implies that all the income (both sourced from within Oman, and otherwise) of entities based in Oman, either through a Permanent Establishment or otherwise, is used for calculating Corporate Income Tax in Oman.
Corporate Income Tax Rates in Oman
The applicable of rate of tax in Oman is uniform across all business entities, regardless of the whether the entity being a corporate entity or not.
The applicable Income Tax rate in Oman is set at 15% for all the taxpayers, in exception of proprietorships in Oman (or establishments), as well as Limited Liability Corporations (LLCs) that fulfill conditions of both, small and medium enterprises.
For proprietorships in Oman, as well as Limited Liability Corporations (LLCs), CIT is levied at a rate of 3%. However, the following requirements need to be met:
- Registered capital of up to OMR (Omani Riyal) 50,000 at the beginning of the given tax year.
- Gross income of up to OMR (Omani Riyal) 100,000 on a yearly basis.
- Average number of employees of up to 15 employees.
- The core business activities include air/sea transport, as well as extraction of natural resources, or banking (and other financial related services).
Petroleum Income Tax: Petroleum Income Tax is levied at a rate of 55% for income derived from the sale of petroleum. It must also be noted that tax rates are mostly applicable on income as determined by the official contracts.
Other Taxation in Oman
- Value Added Tax (VAT): Along with other countries in Gulf Cooperation Council (GCC), Oman has announced its intention of implementing a VAT system across the country. VAT is meant to be applied as a standard rate of 5%. This is levied on all goods and services that are supplied in Oman. However, there are certain exemptions in place, primarily on essential items, like food staples.
- Custom Duties: Custom Duties are levied on almost all goods and services imported in Oman. It is levied at a rate of 5%. This is applied as a percentage of cost, insurance, as well as freight value on most non-GCC goods.
- Excise Taxes: Excise Taxes are implemented on goods and services including tobacco and sweetened beverages. For tobacco, the excise taxes in place are equivalent to 100%. For sugar sweetened beverages, the excise duty is equivalent to 50%.
- Stamp Duty: Stamp Duty is payable mostly on transfer of land and other immovable property. It is levied at a rate of 5%.
- Social Security Contributions: Social Security Contributions are made equivalent to 17.5%. However, it is only applicable on individuals that are residents of Oman. In this regard, the employee is supposed to bear a contribution of 7% of salary. On the contrary, the employer pays the remaining balance of 10.5%. Additionally, the employer is also supposed to bear an insurance charge of 1% of the salary of the employee. Therefore, the employers’ contribution is equivalent to 11.5%.
- Municipal Taxes: Municipal Taxes are applicable on property, as well as other property related items. For property rents, the levy is 3%, whereas for hotel occupancy, the applicable rate is 5%. For cinema houses, and other leisure related properties, the applicable charge is 10%.