The rate
The standard rate in Oman is 5%. Some goods and services carry reduced or zero rates and others are exempt. The difference matters: zero-rated sales still let you reclaim the tax on your purchases, exempt sales do not.
Who must register
VAT is 5%, in force since 16 April 2021 under Royal Decree 121/2020. Registration is compulsory at 38,500 OMR of annual supplies and voluntary from 19,250 OMR of supplies or of expenses.
How to register
A business with a place of residence in Oman applies for registration within 30 days of meeting either test in Art. 55 of the VAT Law, and registration takes effect on the first day of the second month after the month in which the threshold was met, or on the date shown on the certificate (Executive Regulations, Art. 110). The application goes to the Oman Tax Authority on its prescribed form (VAT Law, Art. 62).
The OTA can refuse an application that does not meet the conditions and must tell the applicant the reasons (VAT Law, Art. 63). It can also register on its own initiative a person who failed to register on time, and related persons with similar or linked activities whose combined annual supplies pass the threshold (Art. 59). A registrant making only zero-rated supplies may apply to be exempt from registration (Art. 60).
On approval the OTA issues a registration certificate showing the tax identification number and effective date. A copy must be displayed at the place of work (Executive Regulations, Art. 123).
Filing and paying
Registered and filed with Oman Tax Authority.
Quarterly, on calendar quarters. The return is filed electronically with payment within 30 days of the end of the period, so 30 April, 30 July, 30 October and 30 January.
Penalties for getting it wrong
Late payment carries additional tax of 1% of the unpaid VAT for each month or part month. A late or missing return carries 500 to 5,000 OMR, and understating tax 1% to 25% of the difference. Deliberately failing to register or filing a false return is criminal: one to three years and a fine of 5,000 to 20,000 OMR.