Oman VAT: Publications issued in the Official Gazette

The Oman Tax Authority (TA) has published three decisions in the Official Gazette Issue 1374 published on 10 January 2021, in preparation of the introduction of VAT in Oman. All three decisions were issued on 4th January 2021 and would come into effect from the day after it is published in the Official Gazette, i.e. 11th January 2021.

Decision Number 1/2021 - (Mandatory and Voluntary Registration Threshold)

This Decision is on determination of Mandatory and Voluntary Registration Threshold, provides that:

• The monetary threshold for mandatory registration under Article 55 of the Oman VAT Law will be RO 38,500.

• The monetary threshold for voluntary registration under Article 61 of the Oman VAT Law will be RO 19,250.

Please click here to access the Arabic version of Decision Number 1/2021.

Decision Number 2/2021 - (Food items at zero rate)

This Decision is on Determination of Food items subject to VAT at zero rate. The list is similar to the list of food items exempt from Customs duty and Bahrain’s list of zero rated VAT food items .

To download Narayan Tax's unofficial English translation of the list, please click here. You may also click here to access the Arabic version of Decision Number 2/2021.

Decision Number 3/2021 - (VAT Registration)

This Decision is on Determination of VAT Registration Schedule and Date. It summarizes the schedule for mandatory VAT registration for Taxable Persons under Article 55 of the Oman VAT Law, as follows;

The decision also provides that Taxable Persons eligible for voluntary VAT registration may apply for registration under Article 61 of the Oman VAT Law anytime on or after 1 February 2021. The effective date of such registration will be as specified in the registration certificate.

Please click here to access the Arabic version of Decision Number 3/2021.

Additional VAT Guidance

The TA has also issued an additional guidance in January 2021 on preparing for the implementation of VAT throughout the business.

The guide encourages businesses to act early by appointing a steering committee and a specialist working group made up of key personnel from across all internal business divisions, to give the business time to prepare. These individuals should meet regularly to track progress on preparations. Businesses should make themselves familiar with the VAT legislation and TA guidance, and identify any areas of ambiguity early so that they may be clarified with the TA.

The guide also highlights the importance of testing any new systems, processes and procedures before the 'go live' date, and implementing ongoing monitoring and internal auditing in order to ensure continued compliance.

Please click here to access the Arabic version of the additional guidance.

How we can help?

Our team is available to discuss and bring clarity to the specific challenges that your businesses will face in getting ready for VAT. At Narayan Tax, we have organized VAT work streams that involve impact assessments, service design and implementation, as well as ongoing VAT technical analysis, advisory, training, project and change management. We can help you through all phases of implementation, providing advice and recommendations for managing VAT compliance, addressing VAT costs and avoiding significant penalties