No Personal Income Tax in Oman
Reviewed by the Commoner Law Editorial Team. Sourced from Omani royal decrees, ministerial decisions, and the Basic Statute of the State. Written in plain language for general understanding — this is educational content, not legal advice. Our editorial standards
What is this right?
One of Oman's most important tax features is the absence of personal income tax:
- No tax on salaries: Individuals do not pay income tax on their employment income, wages, or salaries in Oman — neither Omanis nor expatriates.
- No tax on investment income: Personal dividends, interest, and capital gains are generally not taxed at the individual level.
- Business income exception: If you earn income through a sole proprietorship or business, that business income is subject to the 15% corporate tax.
- PASI contributions: While there is no income tax, Omani nationals pay social security contributions of 7% of salary to the Public Authority for Social Insurance (PASI), with employers contributing an additional 11.5%.
- Expatriate difference: Expatriate workers are not subject to PASI contributions, though employers must provide end-of-service gratuity.
When does it apply?
- You are an employee (Omani or expatriate) earning a salary in Oman — no income tax is withheld.
- You are an Omani national — PASI deductions of 7% appear on your payslip.
- You are considering starting a business — understand that business income is taxed at 15%.
What to Do If You Are Confused About Whether Your Salary in Oman Is Taxable
- Understand the difference between salary (untaxed) and business income (taxed at 15%).
- If you are Omani, verify your PASI deductions are correct — 7% employee share and 11.5% employer share.
- If you are an expatriate, check whether your home country taxes your worldwide income — you may still owe taxes there.
- Keep records of your income in case your home country requires tax reporting.
What should you NOT do?
- Do not assume all income is tax-free — business and commercial income is taxed at the corporate level.
- Do not ignore home-country tax obligations — many countries tax their residents' worldwide income.
- Do not confuse "no income tax" with "no tax at all" — Oman has VAT, corporate tax, PASI contributions, and excise duties.
Common Questions
When does it apply — no personal income tax?
You are an employee (Omani or expatriate) earning a salary in Oman — no income tax is withheld.You are an Omani national — PASI deductions of 7% appear on your payslip.You are considering starting a business — understand that business income is taxed at 15%.
What should I do if someone tells me I owe personal income tax on my salary in Oman?
Understand the difference between salary (untaxed) and business income (taxed at 15%).If you are Omani, verify your PASI deductions are correct — 7% employee share and 11.5% employer share.If you are an expatriate, check whether your home country taxes your worldwide income — you may still owe taxes there.Keep records of your income in case your home country requires tax reporting.
What should you NOT do — no personal income tax?
Do not assume all income is tax-free — business and commercial income is taxed at the corporate level.Do not ignore home-country tax obligations — many countries tax their residents' worldwide income.Do not confuse "no income tax" with "no tax at all" — Oman has VAT, corporate tax, PASI contributions, and excise duties.