Oman - Overview and introduction

Tax TIES: Oman - Overview and introduction

Taxation of international executives

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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. There are no foreign exchange restrictions or levies. There are no sales or value-added taxes.

Taxation in Oman is levied, broadly on taxable income at 12 percent, on businesses and companies. A new tax law, the Income Tax Law No. 28/2009 (the New Law), was promulgated on 1 June 2009 and became effective for all accounting periods ending on or after 1 January 2010. Under the New Law, Oman moved to a global tax system replacing the territorial system of tax which was the basis of taxation under the Law of Income Tax on Companies 1981 (the Old Law). Whilst the basis of taxation under the Old Law was territorial, there were notable exceptions which effectively became the law by virtue of the Courts approving such exceptions. These included profits accruing overseas to a local company through branch type operations, overseas dividends and capital gains. The New Law seeks to avoid any disputes by confirming the right of the Tax Authorities to tax all income wherever earned by a company in Oman (worldwide basis of taxation). The Executive Regulations to the New Law detailing how certain provisions of the New Law are to be applied was issued by Ministerial Decision 30/2012 and became effective from 29 January 2012.

The official currency of Oman is the Omani Rial (RO) and, approximately, one Omani Rial is equal to USD2.60.

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