Oman introduced VAT on 16 April 2021. It is administered by the Oman Tax Authority, and most goods and services are taxed at the standard rate of 5%.
Who must register
- Registration is mandatory when your taxable supplies in Oman exceed OMR 38,500 a year, or are expected to in the next 12 months.
- You can register voluntarily from OMR 19,250, which lets you recover input VAT on your costs.
- Once registered, you receive a VAT identification number (VATIN) that must appear on your tax invoices.
Rates you'll use
- 5% standard rate on most supplies.
- 0% on certain supplies, such as exports and some basic foodstuffs, medicines and medical equipment.
- Exempt supplies, such as most financial services and the rent of residential property, which carry no VAT and don't allow input recovery.
Filing and paying
Most businesses file quarterly. The return and any VAT payable are due within 30 days after the end of each tax period, through the Tax Authority's online portal. Late filing and late payment attract penalties, so it pays to keep the return in step with your books.
Three-decimal rials
The Omani rial has 1,000 baisa, so amounts and VAT must be kept to three decimals. Software that rounds to two decimals leaves small differences between invoices, the return and customers' records.
Preparing the return from your books
In SoarLedger, an Omani company records VAT on each invoice and bill line, keeps every amount to the baisa, and builds a draft VAT return grouped the way the Tax Authority asks. Review it with your accountant before filing, especially your first return.
Rates, thresholds and deadlines here are general information from public Tax Authority guidance. Check the latest rules with the Oman Tax Authority or your adviser before you file.
Written by the SoarLedger team · General information, not tax advice — confirm your obligations with your Chartered Accountant.