Tax and Accounting Compliance in Oman

The current standard rate is 15%, which is applicable to companies in the mainland region. A 10% withholding tax will apply to non-residents on payments like royalties, fees, and dividends if they’re operating from the mainland.

If you’re a small or medium enterprise in Oman, then you can be eligible for a reduced 5% rate. Companies must have an OMR 100,000 annual gross income, fewer than 15 employees, and a paid-up capital of OMR 50,000 to qualify for the tax concession.

No, you don’t have to register for value-added taxes like corporate taxes in Oman. Once your business exceeds the OMR 38,500 threshold, you will have to register for VAT.

You can also apply for voluntary registration if you have crossed the OMR 19,200 turnover, but still less than the OMR 38,500 limit, and want to claim VAT credits, enhance your credibility in the market, or are currently working with registered suppliers and entities.
Are there any penalties for noncompliance with corporate and VAT compliance in Oman?
Yes, if you fail to comply with tax rules in Oman, then you’ll have to:

• Pay fines of OMR 5,000 to OMR 20,000 for late registration.
• Late return filing fees range from OMR 500 to 2,000.
• Additional administrative fines ranging from OMR 500 to OMR 2,000 if you provide incorrect information on your returns. 
• An OMR 1,000 to OMR 10,000 and imprisonment up to 2 months to 1 year, or both in case of intentional tax evasion.

As of 2026, there’s no individual income tax in Oman. However, a 5% rate has been introduced for income exceeding OMR 42,000, starting Jan. 1, 2028. The rate will apply to both residents and expats in Oman.

You must file your annual company tax returns within four months of the end of the financial year. Most companies in Oman have Dec. 31 as the year-end date, so April 30th should be your deadline for filing your returns. It should be noted that you are mandated to submit the return even if your business had no turnover or profit in that particular year.

All LLCs, joint stock companies, and branch offices of foreign founders are required to submit the audited financial statements, including a balance sheet, P&L, cash flow statements, and notes. Only an Oman-based licensed professional is allowed to conduct the audit. Contact Enterslice and let us help you connect with a top auditor in Oman.
Furthermore, the auditing rule doesn’t apply to SMEs under the 3% auditing rule. However, they are still required to maintain proper accounting documentation in case the tax agency requests the paperwork for verification.

Yes, as a registered company in Oman, you are allowed to carry forward your losses for up to five years, provided you comply with the Oman tax laws and regulations. Businesses with multiple years of losses will have to offset them in a chronological order; for example, a loss in 2023 must be used before a loss from 2024 or 2025.
However, you may not be eligible to carry forward your losses if you fail to file your corporate tax returns on time.

The Oman Tax Authority/administration is the primary tax regulatory authority that oversees registrations, refund requests, credit claims, tax return reviews, other tax assessments, and any other related matters.

You must maintain detailed invoices, sales/purchase records, submitted returns, refund records, VAT registration certificate, credit/debit notes, documents on import/export, inventory, and details on goods/services provided at a zero-rated rate.