Oman Corporate Tax Guide 2026

Standard Corporate Tax Rate: 15%

The standard CIT rate in Oman is 15% of taxable profits for all companies. This applies to Limited Liability Companies (LLCs), Joint Stock Companies (SAOG/SAOC), branches of foreign companies, and any other juridical person engaged in business in Oman. Taxable profit is calculated as gross revenue minus allowable deductions under the Income Tax Law (Royal Decree 25/2009 and amendments).

Key rate facts:

• Standard CIT: 15% on taxable profits — most companies
• SME exemption: 0% for companies owned by Omani/GCC nationals with annual revenue < OMR 100,000 (~USD 260,080)
• Oil and gas production: 55% of taxable profits
• Gas exploration: 12% of taxable profits
• Free zones: 0% CIT for 30 years from commencement (Sohar, Salalah, Duqm, Al Mazunah)

SME Exemption — 0% CIT

Small and medium enterprises owned entirely by Omani or GCC nationals benefit from a 0% CIT rate if their annual gross revenue does not exceed OMR 100,000. This exemption is automatic and does not require prior approval, though the entity must still file a corporate tax return with the Secretariat General of Taxation (GTA portal) to confirm eligibility.

Conditions:

• 100% owned by Omani or GCC natural persons
• Annual gross revenue ≤ OMR 100,000
• Must maintain proper accounting records
• Must file annual tax return within 120 days of year-end

Example: A wholly Omani-owned trading company with annual revenue of OMR 85,000 and expenses of OMR 60,000 has a profit of OMR 25,000. The CIT liability is OMR 0 (SME exemption). If revenue exceeds OMR 100,000 in a future year, the 15% rate applies to the full profit.

Free Zone Tax Holidays

Oman's free zones offer a 0% CIT for 30 years from the date of commencement of commercial operations. The key free zones are:

• Sohar Port and Free Zone: Industrial and logistics hub, 30-year CIT holiday, 0% customs duties
• Salalah Free Zone: Logistics and manufacturing, 30-year CIT holiday, 0% import duties
• Duqm Special Economic Zone (SEZAD): Multi-sector (refining, petrochemicals, tourism), 30-year CIT holiday, streamlined regulations
• Al Mazunah Free Zone: Bordering Yemen, 30-year CIT holiday, focus on light manufacturing and trade

Free zone entities are exempt from CIT for 30 years. They must still register for VAT if turnover exceeds OMR 500,000 and must file annual corporate returns (even at 0% rate) to maintain compliance.

Deductible Expenses

Allowable deductions under Omani tax law include: operating expenses, salaries and wages, rent, utilities, depreciation of fixed assets (straight-line, rates prescribed by law), interest on business loans (subject to thin capitalisation rules), and charitable donations (up to 5% of taxable income). Expenses must be wholly and exclusively incurred for business purposes and supported by proper documentation.

Non-deductible items: Fines and penalties, dividends paid, capital expenditure (capitalised and depreciated), entertainment expenses (50% disallowed), and zakat paid (separate system).

Filing and Payment

Corporate tax returns must be filed within 120 days of the end of the tax year (calendar year January–December unless alternate period approved). Payment is due with the return. Late filing penalties: OMR 200 per month for the first 6 months, then OMR 100 per month. Late payment attracts 1% interest per month on unpaid tax.