Royal Decree 9 of 26 February 2017 launched a number of key changes to the Income Tax Law issued by way of Royal Decree 28 of 2009, including a special regime for small businesses.
The small business will be subject to income tax at a rate of 3%. A tax return is required to be filed electronically within 3 months from the end of the financial year. The tax return must be accompanied with an income statement prepared on a cash basis.
The small business will be exempt from tax if it employs at least 2 Omani nationals; or is managed on a full-time basis by the sole proprietor or one of the partners.
A small business is defined as an Omani sole proprietorship or company meeting a number of requirements as follows:
- equity not more than OMR 50,000;
- annual revenues OMR 100,000 or less; and
- average number of employees during the year not exceeding 15.