Registration of a mainland company in Oman. Service offer

A mainland company in Oman is a company registered with the Ministry of Commerce, Industry and Investment Promotion (MoCIIP or MOCI).

Mainland companies can be registered in various legal forms:

1. General Partnership;
2. Limited Partnership;
3. Joint Venture;
4. Joint Stock Company;
5. Limited Liability Company;
6. One-Person Company;
7. Holding Company.

A mainland company is most commonly registered in the form of a limited liability company (LLC).

Companies with 100% foreign ownership are allowed to carry on most of the activities. However, some activities are prohibited to foreigners. The list of activities prohibited to foreign investors includes 70 items, among which:

• Insurance agencies;
• Real estate brokerage;
• Manpower recruitment offices;
• Wholesale of fruits and vegetables;
• Wholesale of fish and sea creatures;
• Wholesale of fish products;
• Wholesale of livestock, except projects with large production capacities;
• Retail sale in specialised stores of meat and meat products;
• Retail sale of antiques and paintings;
• Beekeeping and production of honey and beeswax;
• Marine fishing.

Some activities may require additional approvals from the industry-specific regulatory authorities.

Oman has 3 types of licences:

1. Licences that are obtained automatically by submitting an online application and paying the relevant fees. Such licences include, for example, software development and sale and most trade activities, including trade in construction materials, industrial equipment, computer hardware, etc.
2. Licences that are obtained by submitting an online application after approval from the industry-specific regulatory authority and paying the relevant fees: advertising and marketing, construction and engineering, opening restaurants and coffee shops, etc.
3. Licences that require visiting industry-specific regulatory authorities in person.

A limited liability company (LLC) must have between 2 and 50 shareholders (members) whose liability is limited to the value of their share in the company’s capital.

• No minimum share capital requirement.
• The share capital must be deposited in one of the approved local banks, after which the company can complete its registration.

• A limited liability company can appoint one or more managers.
• No requirements for the nationality or residence of the manager.
• Managers can be elected from among the company’s members.

The registration of a mainland company in Oman includes the following steps:

1) It is necessary to select:

• company name to be checked for availability (at least three names), which name:
  • must not be identical or similar to the name of an existing company;
  • must contain an indication of the legal form (Limited Liability Company or LLC);
  • must not contain references to the names of rivers, cities, and famous places in Arab countries;
  • the words “International”, “Global”, and “Overseas” are available to companies with a share capital of at least OMR 100 000 (~ USD 260 000);
  • the words “Oman” or “Omani” can be used by companies with a share capital of at least OMR 500 000 (~ USD 1 300 000);
• company structure (shareholders, manager);
• business activity.

Some activities require special approval from the various authorities (federal and local).

2) Paying fees.

3) It is necessary to provide documents for the managers / members / attorneys (originals or notarized copies):

• passport or ID card;
• proof of address;
• CV.

The shareholders need to additionally provide personal data in writing: phone number, email, residential address, country of residence, mother’s name, marital status, religion, and nationality.

For compliance check, the shareholders will also need to sign a client information form and a contract for administration.

4) Name check and receipt of the Certificate of the Trade Name – takes 1 day.

Registration can be carried out remotely by power of attorney, with an apostille.

5) Submitting an online company registration application to the Ministry of Trade, Industry and Investment Promotion. The application must contain details of the shareholders, managers, and business activities of the company, and be accompanied by the company’s article of association. After the assessment of the application, MoCIIP issues a Commercial Registration (CR) certificate.

6) After receiving a Commercial Registration (CR) certificate, it is necessary to submit an application for a licence through the MoCIIP portal or in person (depending on the type of licence) and comply with the relevant requirements.

7) Obtaining a TIN from the Sultanate of Oman Tax Authority (TA).

Upon completion of company registration, you will receive the following documents:

• Commercial Registration (CR) certificate – in electronic form;
• Licence for the company’s declared business activity (the licence is issued for 1 year) – in electronic form;
• Office lease agreement (for 1 year, depending on the selected office package) – in original;
• Articles and Memorandum of Association – in original;
• TIN certificate – in electronic form.

A company seal is also issued.

In Oman, a residence visa can be obtained on the following grounds:

1. Category 1 investor visa is issued for 10 years, with ID reissued every 3 years. Such visa requires investing at least OMR 500 000 (~ USD 1 300 000) in a company or buying real estate of the same value;
2. Category 2 investor visa is issued for 5 years, with ID reissued every 3 years. Such visa requires investing at least OMR 250 000 (~ USD 650 000) in a company or buying real estate of the same value;
3. Employment (work) visa is issued for 2 years and can be renewed.

The application for an employment visa includes the following steps (a visa can only be applied for after the company registration has been completed):

1. Obtaining permission to hire employees (labour permit) from the Ministry of Labour.

2. Submitting an application for an employment visa. The application must be accompanied by:

• 2 photos – like ones for a passport;
• original passport and one copy not older than 6 months;
• original labour permit and its copy issued by the Ministry of Labour;
• job offer or a signed contract with a mainland company;
• medical examination report (from the applicant’s country of residence) certified by the Ministry of Health.

3. To obtain an ID card, an individual must enter Oman on an employment visa (and has not more than 6 months to do it) and visit the police for stamping the visa, submitting biometrics and an application for an ID. To complete the procedure, an individual must undergo a medical examination at a medical centre in Oman.

An ID card is issued at the police station in 1 day.

A company is required to annually renew its Commercial Registration and licence by paying relevant fees. It is also necessary to renew the office lease agreement.

Company Registration and licence must be renewed 30 days before their expiration date.

Oman’s Commercial Companies Law requires companies registered in Oman to prepare their financial statements in accordance with International Financial Reporting Standards (IFRS).

The first financial period may last more than 12 months or less, but it must not be less than 6 months or more than 18 months from the company’s incorporation date. Every subsequent accounting period lasts 12 months.

The tax return and supporting audited financial statements must be made in OMR (Omani rial).

For tax periods started after 1 January 2020, taxpayers must submit an income tax return (together with financial statements) within 4 months of the end of the accounting period.

Any of the following circumstances requires an LLC to have an auditor (to be appointed by the general meeting of shareholders for one financial year):

1. the number of the company’s shareholders exceeds 7 persons;
2. the company’s share capital exceeds OMR 50 000;
3. the constitutive documents provide for the appointment of an auditor;
4. one or more shareholders representing at least one fifth of the company’s share capital request appointment of an auditor.

The corporate income tax rate is 15% for all taxpayers other than establishments (proprietorships)* and limited liability companies (LLCs) that meet the conditions for small and medium-sized enterprises (SMEs).

*An establishment solely owned by a natural person which independently carries on a commercial, industrial or professional activity in Oman.

The Omani establishments (proprietorships) and LLCs that meet the following requirements:

1. the share capital does not exceed OMR 50 000 at the start of the tax year;
2. the gross income does not exceed OMR 100 000 in any tax year;
3. the average number of employees during the tax year does not exceed 15;
4. the taxpayer’s activities do not include air / sea transport, extraction of natural resource, banking, insurance or financial services, public utility concessions, or other activities determined by the Minister of Finance after the approval by the Council of Ministers;

are taxed at a rate of 3%, coupled with the requirement for taxpayers of small and medium-sized businesses to file corporate income tax returns.

Municipal taxes apply to the following items:

• Property rents: 3%;
• Hotel occupancy: 5%;
• Leisure and cinema houses: 10%.

Income from oil sales is taxed at a rate of 55%.

The general withholding tax rate (dividends, interest, royalties) is 10%.

Oman does not levy personal income tax on wages or benefits of individuals, regardless of nationality or residence.

On 12 October 2020, Oman introduced value added tax (VAT).

VAT as a general consumption tax applies to all transactions with goods and services unless such transaction is exempted or taxed at 0% rate.

The standard VAT rate in Oman is 5%.

There is no obligation to register for VAT unless sales turnover within the country exceeds the registration threshold, which is OMR 38 500 (~ USD 100 000) in Oman.

[1] The fees are valid as at July 2024.

[2] The fees for preparing financial statements and conducting an audit are charged based on the time spent at hourly rates ranging from USD 100 to USD 400 (depending on the type of work and qualification of a specialist involved).