First to register for Oman VAT was businesses with an annual turnover of RO 1 million or more. They were required to register between February 1 and March 15, 2021. For businesses with a turnover of over RO 500,000 but less than RO 1 Million, Oman VAT registration must be completed between 01 April 2021 to 31 May 2021 and their VAT payment liability would kick in from July 1, 2021..Consider the taxable supplies for the full month of October 2020 (the month when VAT Law was published in Official Gazette) adding to it taxable supplies for the eleven months preceding the month of October 2020; OR Consider the taxable supplies by the end of October 2020 and next 11 months expected taxable supplies. If the taxable supplies, as determined above exceeds mandatory threshold for registration, the business must obtain VAT registration immediately when VAT registration opens. For mandatory registration, only the value of supplies will be considered. Whereas for voluntary registration, the value of supplies as well as inputs (expenses) subject to Oman VAT will be considered. .

VAT @5% shall be payable while clearing imported goods from the port. -You can offset this amount of VAT paid by you as ‘Input VAT’ against ‘Output VAT’ payable on your sales if imported goods are VAT taxable items; -You can claim VAT refund later if the goods are ‘zero rated’; -But if you deal in ‘Exempt’ items, VAT shall be your cost and you can’t charge to your customers or claim VAT refund.

Oman VAT Regulations vide Tax Authority Decision No.53/2021 read with Article 72 of the Oman VAT Law mandate that Oman VAT returns shall be filed within 30 days from the end of the tax period.The companies who register after 01 Feb 2021 till 31 March 2021 shall file their first VAT return on or before 30 July 2021. Those registering between 01 April 2021 to 31 May 2021 shall file thier first VAT return on or before 31 October 2021.Article 100 of Oman VAT Law imposes a penalty of RO 10,000 for non-filing of VAT returns..

If payment was made or invoice was raised before effective date of VAT Law, but the goods are delivered or services are completed after effective date of VAT Law or after VAT registration, such sales or goods or services shall attract VAT levy..

Reverse charge mechanism is applicable to imports from another GCC country to Oman. As per Article 20 of Oman Vat Law import from Dubai or UAE would be chargeable to 5% VAT at the point of entry to Oman.

VAT rate in Oman is 5%.

Article 51 of Oman VAT Law mentions seven items that would be subject to zero rate. The following supplies will be zero rated, subject to the conditions to be specified in the Executive Regulations or a decision by the Chairman of Oman Tax Authority : a. Food items as determined by the Chairman of Oman Tax Authority; b.Crude oil, oil derivatives and natural gas c. Specified medicines and medical equipment d. Investment gold, silver and platinum e. International or intra-GCC transport of goods or passengers, and supply of services in connection with such transport f. Means of air, sea and land transport designated for transportation of goods and passengers for commercial purposes and the supply of related goods and services g. Rescue planes, and rescue and assistance boats

Following are the ‘exempt’ items under Oman VAT law : a. Financial services b. Healthcare services and related goods and services c. Educational services and related goods and services d. Bare land e. Resale or lease of residential properties f. Local passenger transport

Oman VAT Law requires payment of 5% VAT on all imports by way of reverse charge mechanism but the following imports are exempt from Oman VAT, subject to the conditions to be specified in the Executive Regulations: a. Import of goods, the supply of which is exempt or zero rated in the final destination point of entry b. Import of goods by/for specified diplomatic and consular bodies, international organizations, and heads and members of consular bodies, on the condition of reciprocity c. Import of specified goods by the Armed Forces and Internal Security Forces d. Import of personal effects and used household items by Omani citizens residing abroad upon return, as well as foreigners moving to live in Oman for the first time e. Import of goods for non-profit charities f. Returned goods g. Personal effects and gifts accompanying travelers arriving in Oman h. Import of specified goods for people with special needs

Yes – ‘input VAT’ paid can be claimed against ‘output VAT’ within a period of three years.

Company that deals only in ‘zero rated’ items can apply for exemption from Oman VAT registration.