What Makes a Wakala Valid

Under article 88 of the Civil Transactions Law, any act the agent carries out within the limits of the power of attorney is treated as if the principal had carried it out personally. For this reason, article 673 sets three basic conditions:

• The principal must be entitled to carry out the act: A person cannot authorise someone to sell a house they do not own.
• The agent must be legally able to act: In general, this means an adult with full legal capacity.
• The task must be clearly defined and capable of being performed by another person: “Sell my car with plate number X” is clear; a vague instruction is not.

General or Specific

Under articles 675 and 676 of the Civil Transactions Law, a specific power of attorney covers only the tasks it names, together with whatever is necessary to complete them. A general power of attorney covers most matters, but article 677 provides that it does not allow the agent to donate the principal’s property, settle a dispute, release a debtor, agree to arbitration, lend money, or act in family matters such as marriage or divorce, unless the document expressly says so. Where the wording is vague, article 678 limits the agent to managing and preserving the principal’s property.

Obligations of the Principal and the Agent

Articles 680 to 689 require the agent to stay within the powers granted, exercise due care, keep the principal informed, and not delegate the task to another person without the principal’s permission. An agent authorised to collect money cannot litigate on the principal’s behalf, and an agent authorised to litigate cannot collect money, unless the power of attorney allows both. In return, under articles 690 and 691, the principal must pay any agreed fee and the agent’s reasonable expenses.

Notarisation and Foreign Documents

A power of attorney intended for use before the courts, government bodies, or banks is normally notarised by the public notary. It must be in Arabic or accompanied by an Arabic translation from a legal translation office. Witnesses are no longer required under Supreme Judicial Council Decision 65/2025, and the document can be notarised remotely by video call through the Tawtheeq system under Supreme Judicial Council Decision 531/2024.

A power of attorney made abroad must usually be legalised, meaning certified by the authorities of the issuing country and of Oman, and translated into Arabic. Documents issued in other GCC countries are an exception and are accepted without legalisation, as the Supreme Court held in Supreme Court (First Civil Circuit) Contestation 240/2005.

Duration and Termination

Under article 694, a power of attorney ends when the task is completed, when the end date stated in it passes, or when the principal or the agent dies or loses legal capacity. A power of attorney with no end date does not lapse simply with the passage of time, as confirmed in Supreme Court (Commercial Circuit) Contestation 361/2021. However, the public notary fee schedule in Supreme Judicial Council Decision 234/2022 lists validity periods, and some banks and government bodies may still apply them in practice.

Article 695 allows the principal to revoke a power of attorney at any time, except where it was granted to protect the rights of a third party or for the agent’s own benefit. Revocation should be notified to the agent formally. In Supreme Court (Civil Circuit) Contestation 687/2016, a revocation that was never communicated to the agent did not invalidate a sale the agent later concluded.

Litigation and Companies

A power of attorney used to bring a case before the Supreme Court must name the individual lawyer, not only the law firm, as held in Supreme Court (Civil Circuit) Contestation 210/2020. For a joint stock company, the power of attorney must be signed by the chairman of the board of directors, or by a person the chairman has authorised in writing, with that authorisation attached, as held in Supreme Court (Civil Circuit) Contestation 374/2022.

Checklist Before Signing

• Decide whether a specific or a general power of attorney is needed, and describe its purpose clearly.
• Expressly list any acts outside the general scope that are to be included or excluded.
• State whether the agent may delegate to another person.
• For litigation, authorise both litigating and collecting money if both are needed, and name the individual lawyer.
• For a company, ensure the authorised signatory signs, and attach any delegation of authority.
• State an end date if one is wanted; otherwise the law sets none.
• On revocation, notify the agent formally and keep proof of notification.

A well-drafted power of attorney saves time and protects both parties, while a vague one can leave the agent unable to act or acting in ways the principal never intended. You can read the full rules on agency in English at the link below:

Written by:

Sharifa Al-Wahaibi

Sharifa is a legal intern at Decree. She has previously interned in the public sector and in private practice. She is interested in corporate law. She holds a law degree from Sultan Qaboos University.

What Is a Law?

Think of a law as the foundation. It is primary legislation: the binding rules issued at the highest level of Oman’s legislative system. Laws are issued by His Majesty the Sultan by royal decree, after the draft has been presented to Majlis Oman, which is made up of Majlis Al-Dawla and Majlis Al-Shura. They take effect on the date the decree sets, usually the day after publication in the Official Gazette.

A law deals with substance: what rights and obligations people have, which institutions enforce them, and what offences and penalties apply. Under the Basic Statute of the State, there is no crime and no penalty except by law, so criminal liability always has to come from a law, never from a regulation alone.

What a law usually will not do is get into the operational detail. It hands that job on to a regulation. Royal Decree 53/2023, which issued the current Labour Law, is a good example: it directs the Minister of Labour to issue the executive regulation and the decisions needed to put the law into practice.

What Is a Regulation?

If the law is the foundation, the regulation is the instruction manual. A regulation is secondary legislation: binding, detailed rules made under a law to put it into effect. It is issued by ministerial decision of the competent minister or authority, and only where a law gives them that power. The type you will meet most often is the executive regulation, which implements one specific law.

The Commercial Companies Law, issued by Royal Decree 18/2019, shows how this works. Its regulation came through Ministerial Decision 146/2021 of the Ministry of Commerce, Industry and Investment Promotion. Look at its preamble and you will see it cites the Commercial Companies Law as its legal basis, as every regulation must.

This is where the practical answers live: procedures, documents, fees, deadlines and technical standards. But a regulation can only reach as far as its law allows. Public joint stock companies, for instance, fall outside that regulation and follow separate rules issued by the Capital Market Authority.

How They Differ

Start with where each one comes from. A law is issued by His Majesty the Sultan by royal decree, after presentation to Majlis Oman. A regulation is issued by a minister or competent authority by ministerial decision, and only because a law has given them the power to do so.

They also do different jobs. A law decides the rules: who holds which rights and duties, who enforces them and what happens if they are broken. A regulation shows how those rules work day to day, through procedures, forms, fees and timelines.

Then there is rank, which matters most when things go wrong. A law draws its authority from the Basic Statute of the State; a regulation draws its authority from the law. So a regulation cannot contradict the law, add obligations the law does not allow or stray into matters the law never delegated. If the two clash, the law wins.

They change at different speeds, too. Amending a law takes another royal decree, but a regulation can be updated by ministerial decision. That is why regulations shift more often, and why it pays to check them regularly.

Finally, do not expect them to arrive together. More than two years passed between the Commercial Companies Law and its regulation. To bridge gaps like this, the decree issuing a new law usually keeps older regulations in force as long as they are consistent with the new law, as Royal Decree 53/2023 did for the Labour Law.

The Bottom Line

Whether you run a business or advise one, read the law and its regulation as a pair. The law tells you what you must do; the regulation usually tells you how. Check that the regulation rests on a proper legal basis, and make sure you are working from the latest version of both. Read one without the other and you only have half the picture.

Written by:

Layan Al-Dhakhri

Layan is a legal intern at Decree. She has previously interned in the aviation sector and in local and international law firms. She is interested in corporate law. She holds a LLB from Cardiff Metropolitan University.

Royal Decrees

Royal decrees sit at the top of Oman’s legislative pyramid, just beneath the Basic Statute of the State. They are issued by His Majesty the Sultan and are the vehicle through which laws are issued, international agreements are ratified, ministries and public bodies are created or restructured, and senior officials are appointed.

When a royal decree issues a law, the law itself is usually attached to the decree. The decree’s own short articles handle the practical matters: repealing older legislation, keeping existing regulations in force until replacements are issued, and naming the minister responsible for issuing implementing rules. Draft laws generally pass through the Council of Oman before they reach this stage.

A royal decree takes effect according to its own terms: some from the date of issuance, others from the day after publication in the Official Gazette, and some after a set number of months or years. No ministerial instrument can override a royal decree.

Ministerial Decisions

A ministerial decision is the formal legal instrument used by ministers to issue executive regulations, procedural guidelines, licensing conditions, fee structures, and administrative appointments. Ministerial decisions are issued by ministers, or by heads of public authorities with equivalent powers, to put laws into practice.

A minister can act only within the scope granted by a law or royal decree, and a decision must not contradict its parent legislation.

Ministerial decisions that set general rules are published in the Official Gazette and bind everyone they address, such as companies, individuals and government bodies. For most businesses, these are the instruments that shape day-to-day compliance, because they hold the operational detail that laws leave out.

Circulars

Circulars are administrative instructions. A ministry or authority uses them to explain how it will apply existing rules, set procedures for its staff, announce deadlines, or clear up points that have caused confusion. They are usually not published in the Official Gazette, and instead they are posted on the issuing body’s website or sent directly to the sector concerned.

In principle, a circular cannot create new legal obligations or amend a law or decision. In practice, it often signals exactly how a regulator will act, so ignoring one is risky, especially where a regulator has legal power to issue binding instructions to the entities it licenses, as the Central Bank of Oman does for banks.

How they fit together

The order of authority runs from the top down:

1. The Basic Statute of the State
2. Laws and royal decrees
3. Ministerial decisions and regulations
4. Circulars and administrative instructions

When two instruments conflict, the higher one prevails, and among instruments of the same rank a later one generally prevails over an earlier one. A circular that contradicts a ministerial decision should give way to the decision, and a decision that contradicts a law should give way to the law.

The practical lesson is to read these instruments as a chain. Start with the royal decree and the law it issues, check the ministerial decisions that implement it, then look at any circulars for how the regulator applies them today.

Written by:

Layan Al-Dhakhri

Layan is a legal intern at Decree. She has previously interned in the aviation sector and in local and international law firms. She is interested in corporate law. She holds a LLB from Cardiff Metropolitan University.

Article 58 of the Judicial Authority Law sets the judicial holiday from 1 July to 30 September each year. Because of the critical nature of the courts’ work, judges are not usually allowed to take leave outside the judicial holiday unless they were required to work during the judicial holiday or in other exceptional circumstances.

Setting a fixed period for the judicial holiday makes the operation of the courts predictable and helps those dealing with the courts plan their cases better. However, it is worth noting that judges do not actually take the entire three months off. The law allows Supreme Court judges and their equivalents to take up a maximum of two months off, and all other judges a maximum of 50 days.

The courts do not shut down entirely during the judicial holiday, as urgent cases can still be heard. The law itself does not define “urgent cases” and instead leaves this to a decision of the Deputy Chairman of the Supreme Judicial Council. However, this decision is not published in the Official Gazette.

It is important to be aware of the dates of the judicial holiday if you are involved in litigation. Hearings in cases that are not urgent are unlikely to take place between 1 July and 30 September.

To learn more about the work of the judiciary, we highly recommend reading the Judicial Authority Law at the link below:

Written by:

Sharifa Al-Wahaibi

Sharifa is a legal intern at Decree. She has previously interned in the public sector and in private practice. She is interested in corporate law. She holds a law degree from Sultan Qaboos University.

In this post, we first define what a treaty is and look at some examples. We then walk through the two key articles of the Basic Statute on treaties, compare Oman’s approach with other states, and close with what all of this means for the private sector.

What is a treaty?

Under the Vienna Convention on the Law of Treaties, a treaty is an international agreement concluded between states in written form and governed by international law, whatever it happens to be called, be it an agreement, convention, charter, or protocol.

Recent examples of treaties that Oman has ratified or acceded to include the Comprehensive Economic Partnership Agreement with India, the UN Convention on International Settlement Agreements Resulting from Mediation, and the Agreement on the Development of the Railway Link with the United Arab Emirates.

Article 93: ratification and transparency

Article 93 of the Basic Statute of the State sets two rules. First, international treaties and agreements do not have the power of law except after their ratification. Under article 49, the Sultan signs treaties or authorises their signature, and in practice they are often signed by the competent minister or an ambassador. Ratification, however, is always through a royal decree published in the Official Gazette, usually with the treaty text attached.

Second, a treaty may not, in any case, include secret terms that contradict its public terms. This guarantees transparency: what is published is what binds.

Not every state works this way. In some other states, no separate domestic tool is needed. In the Netherlands, under articles 93 and 94 of the Dutch Constitution, treaty provisions that can apply to everyone become binding once published, and even override conflicting Dutch statutes. France takes a similar approach: under article 55 of the French Constitution, duly ratified treaties prevail over Acts of Parliament once published, provided the other party applies them too.

Oman, like the UK, sits on the other side: a treaty needs a domestic tool before it has effect at home. In the UK, ratification alone changes nothing domestically, and Parliament must pass an Act to give a treaty effect. In Oman, that tool is the ratifying royal decree, which itself gives the treaty the rank of law without a separate implementing law.

Article 97: treaties as part of the law of the land

Article 97 of the Basic Statute completes the picture. It prohibits any entity in the state from issuing regulations, decisions, or instructions that contradict the laws and royal decrees in force, or international treaties and agreements that are considered part of the law of the land. In practice, a ratified treaty prevails over ministerial decisions and regulations, while still ranking below the Basic Statute of the State itself.

Two related provisions support this. Article 51 tasks the Council of Ministers with overseeing the implementation of treaties and agreements, and article 89 confirms that the 2021 Basic Statute of the State does not prejudice treaties Oman entered into before it.

Conclusion: why this matters for the private sector

Taken together, these provisions give Oman a clear and transparent treaty framework. A ratified treaty is not a diplomatic gesture; it is law that courts, ministries, and businesses must apply.

This is most visible in double taxation agreements. Without one, a company earning income across borders may be taxed on the same profits in both countries. Oman’s treaties address this by allocating taxing rights and often reducing or removing withholding tax. For example, the double tax agreement with Bahrain gives businesses in both countries greater certainty on their tax obligations.

Article 93 is the key here: these benefits can only be relied on once the treaty is ratified. For the private sector, checking whether a treaty has been ratified, and when it takes effect, is as important as reading its terms.

Written by:

Sharifa Al-Wahaibi

Sharifa is a legal intern at Decree. She has previously interned in the public sector and in private practice. She is interested in corporate law. She holds a law degree from Sultan Qaboos University.

Equality before the Law

Equality forms the foundation upon which all the other rights are built. Article 21 of the Basic Statute of the State states that all citizens are equal before the law and have equal public rights and duties. No one may be discriminated against on grounds of sex, origin, colour, language, religion, sect, place of residence, or social status. In practice, the same rules apply to everyone, whether they are a government minister or a shop owner. Article 15 of the Basic Statute adds that the state guarantees equal opportunities among citizens and equality between women and men.

Freedom of Opinion and Expression

Article 35 guarantees freedom of opinion and expression. This freedom allows people to share ideas, discuss public matters, and contribute to the development of society. It covers expression through speech, writing, and all other means, and article 37 extends similar protection to the press, printing, and publishing. However, like most rights, these freedoms operate within the limits of the law. Article 37 prohibits content that leads to discord or hatred, threatens state security, or offends human dignity. Sharing a view on a new policy is protected; stirring up hatred is not.

The Right to a Fair Trial

Everyone has the right to go to court to protect their rights. Under article 30, the state must make courts accessible and ensure cases are decided quickly. Article 26 provides that no one may be punished except under a law that existed when the act was committed. In addition, article 27 states that any accused person is presumed innocent until proven guilty in a legal trial that provides the guarantees needed for a defence. Furthermore, as stated by article 28, the accused has the right to appoint a person capable of defending them. These protections help ensure that judgments are based on evidence and law, not rumours or pressure.

The Right to Education

Article 16 recognises education as a right for every citizen. Its aims include building the Omani character, preserving national identity, and encouraging innovation. Education is compulsory throughout the primary level, and the state encourages private schools under its supervision. It also commits to combating illiteracy and to giving everyone equal access to higher education based on merit. For families, this means every child is entitled to an education that prepares them for life.

The Right to Work

Work is both a right and an honour under article 15, and every citizen may choose their work within the limits of the law. No citizen can be forced to work except under a law, to perform a public service, for a specific period, and for fair pay. The State must pass laws that protect workers and employers, regulate their relationship, and ensure safety and health at work. Article 14 adds that the state aims to provide citizens with work opportunities.

Conclusion

Understanding these five fundamental rights is essential to knowing the protections that the Basic Statute of the State guarantees. Equality, free expression, fair trials, education, and work shape how people live, learn, and resolve disputes. However, these are only some of the many rights the Basic Statute of the State provides, and reading it in full is the best way to understand the complete range of protections it offers.

Written by:

Layan Al-Dhakhri

Layan is a legal intern at Decree. She has previously interned in the aviation sector and in local and international law firms. She is interested in corporate law. She holds a LLB from Cardiff Metropolitan University.

The Court of Investment and Commerce was established in 2025 to provide an expedited and specialised path for hearing investment and commercial disputes where at least one party is a trader and the dispute relates to their business, as well as disputes arising from investment contracts. This includes disputes between partners and shareholders, banking, construction, transport, intellectual property, and bankruptcy. Notwithstanding the advantages offered by the Court of Investment and Commerce, the court’s judgments can still be contested before the Supreme Court.

The Law of the Court of Investment and Commerce sets out the court’s jurisdiction, composition, and appeal periods, but it leaves much of the day-to-day procedure unexplained. The manual attempts to fill that gap by explaining step by step how to register a claim on the court’s online portal, which documents are needed for each type of claim, and how fees are calculated. It also describes the role of the Lawsuit Preparation Office and sets out the deadlines for exchanging pleadings and for the court to schedule hearings and issue judgments. The manual makes clear that it does not replace the legislation and must be read alongside the court’s law and the Civil and Commercial Procedures Law.

Three provisions from the manual stand out. First, all proceedings start electronically through the court’s portal, where the claimant submits the statement of claim, supporting documents, and court fees. If a request included in the statement of claim is left out of the portal entry, the filing is deemed not to have been made and must be resubmitted. The Lawsuit Preparation Office then reviews the filing. If anything is missing, the claimant has 10 days to correct it. Once the fees are paid, the case is registered and the defendant is notified within three working days.

Second, some claims must be filed through an advocate. This applies to individuals claiming more than 30,000 Rial Omani and to companies claiming more than 10,000 Rial Omani.

Third, the parties exchange their pleadings within fixed periods: 15 days for the defendant’s defence, 15 days for the claimant’s reply, and 10 days for the defendant’s final response. After that, the court has 15 days to schedule a hearing and 90 days to issue its judgment. The court may extend the 90-day period by 45 days.

For businesses and investors, understanding these procedures can help avoid errors and delays when bringing or defending a claim. Although the manual was published in Arabic, an English version is available in full on Decree at the link below.

Punishment is one of the most important tools used by the State to combat crime and protect society. However, the development of modern criminal thought no longer views punishment merely as a means of deterrence, but also as a means of reform, rehabilitation, and reintegration of the convicted person into society.

What Are Alternative Penalties?

Alternative penalties, in the context of this article, refer to criminal sanctions that are not primarily based on restricting the convicted person’s liberty through imprisonment, nor are they limited to financial fines. Rather, they take other forms aimed at achieving the purposes of punishment, particularly reform, rehabilitation, and deterrence.

Examples of alternative penalties adopted by some legal systems include community service, house arrest, rehabilitation and training programmes, and other measures that may achieve the purpose of punishment without resorting, in all cases, to placing the convicted person in prison.

In this sense, an alternative penalty may be viewed as a criminal sanction imposed by a judicial judgment on a person whose responsibility for committing a crime has been established. It aims to achieve deterrence, reform, and rehabilitation while avoiding the effects that may result from custodial penalties, where the nature of the crime and the circumstances of the convicted person permit this.

Alternative Penalties in Omani Legislation

When reviewing Omani criminal legislation, it becomes clear that there are certain applications that move away from relying exclusively on custodial penalties and instead adopt treatment and reform as means of dealing with certain cases.

One example is provided by the Law on Combating Narcotics and Psychotropic Substances issued by Royal Decree 67/2026, particularly articles 41, 42, and 43.

Article 41 permits the court, in cases where a person is proven to be addicted to the use of narcotic drugs or psychotropic substances, to order—instead of imposing the prescribed penalty—that the person be placed in one of the rehabilitation facilities established for this purpose, or be subjected to treatment at a specialised psychological and social treatment clinic, in accordance with the programme prescribed by the psychiatrist or social specialist.

The same article also establishes conditions governing such placement. A person may not be placed in the facility if he has previously been ordered to be placed there twice pursuant to a previous judgment, or if five years have not elapsed since his release from the facility.

Article 42 complements this framework by providing that the release of a person placed in the facility following his recovery shall be by a decision of the court based on the recommendation of the committee referred to in article 68 of the Law, provided that the period of placement is not less than six months and does not exceed one year.

Conversely, if the placement proves ineffective, or the maximum prescribed period expires before the person has recovered, or he violates the obligations imposed upon him, or commits any of the offences provided for under the Law while in the facility, the matter shall be referred to the court through the Public Prosecution for the imposition of the prescribed penalty.

Treatment Instead of a Custodial Penalty

These provisions demonstrate a legislative approach towards addressing certain offences from a reformative perspective, particularly where the criminal conduct is connected to a condition requiring treatment and rehabilitation.

In cases of addiction to narcotic drugs or psychotropic substances, imprisonment may not, in all cases, be the most appropriate means of achieving reform. Treatment and rehabilitation may instead be more closely connected to the underlying cause that led to the commission of the offence, within the limits prescribed by law and under the supervision of the competent authorities.

This does not mean disregarding society’s right to protection or diminishing the seriousness of offences related to drugs. Rather, it reflects an attempt to achieve a balance between protecting society from crime and addressing certain circumstances that may be connected to its commission.

From this perspective, the measures permitted by the legislator under the aforementioned articles may be regarded as forms of sanctions with a reformative nature, as they seek to treat and rehabilitate the convicted person rather than merely restrict his liberty.

Non-Initiation of Criminal Proceedings in Cases Where Treatment Is Requested

Another form worth highlighting is provided for in article 43 of the same Law, which provides—without prejudice to article 40—that no criminal proceedings shall be initiated against a person who uses narcotic drugs or psychotropic substances and voluntarily presents himself to the public authorities for treatment at a rehabilitation facility, or does so at the request of his spouse or one of his relatives, in accordance with the degrees of kinship specified by the provision.

This provision reflects an approach aimed at encouraging the user to seek treatment, rather than allowing fear of criminal prosecution to become a reason preventing him from approaching the competent authorities.

At the same time, the legislator has placed limits on this exception. It does not apply to a person who has been caught using narcotic drugs or psychotropic substances, or against whom criminal proceedings have already been initiated for the offence.

Conclusion

It is clear from the foregoing that the concept of alternative penalties represents one of the modern trends in criminal policy, and that Omani legislation contains certain applications reflecting this approach, particularly in the areas of addiction treatment and rehabilitation.

The importance of alternative penalties lies in their potential to achieve a degree of balance between protecting society from crime, achieving deterrence, and providing an opportunity for reform and rehabilitation in cases where the law permits this.

Nevertheless, the application of alternative penalties must remain linked to the legal provisions and safeguards established by the legislator, as well as to the nature of each offence and the circumstances of its perpetrator. This ensures that an alternative penalty does not become a means of weakening the criminal protection of society, but rather an additional tool for achieving the objectives of justice and reform.

Abdulmalik Al-Hasani is an Omani lawyer practising litigation at Mohammed Al Azri & Mohammed Al Ajmi Law Firm, with a growing interest in criminal law. Before moving into litigation, Abdulmalik spent a year in the corporate sector at Rajab Alkathiri Law Firm, specialising in corporate legal matters. Abdulmalik is a graduate of Sultan Qaboos University.

Who pays

The law works on where you live, not on your nationality, so Omanis and foreigners are treated in exactly the same way. Under article 1, anyone who spends more than 183 days in Oman during a calendar year, whether in one stretch or on and off, is a tax resident and is taxed on their income wherever in the world it is earned. Everyone else is a non-tax resident and is taxed only on income earned inside Oman.

What counts as income

Income has a broad definition. Rather than defining income in general terms, article 7 sets out eleven sources that make up a person’s gross income, and a separate chapter then spells out what each source includes. Income covers:

• salaries
• self-employment income
• rent
• royalties
• interest
• dividends and gains on selling shares and bonds
• gains on selling real estate
• pensions and end-of-service gratuities
• prizes and gifts
• bonuses paid to members of Majlis Al-Dawla, Majlis Al-Shura, municipal councils, and boards of directors

Salary itself is defined widely to include allowances, bonuses, incentives, profit shares, and benefits in-kind such as housing, so an employment package is taxed on its full value and not only on the basic pay.

The rate and threshold

The tax is 5% of taxable income, and the key figure is 42,000 Rial Omani. The law only taxes what exceeds 42,000 Rial Omani in a year, so that amount comes off the top for everyone. It is not a band you fall into once you cross it. Someone earning 50,000 Rial Omani a year is taxed on 8,000, not on the whole 50,000, and any exemptions and costs that apply to them are deducted from that 8,000 before the 5% is calculated.

What is exempt

Article 25 lists sixteen exemptions that are deducted before the 5% is worked out, and several of them will matter to ordinary households:

• Education and health care expenses, not only for the person but for their spouse, parents, children, siblings under their care, and foster children.
• Contributions to pension and post-employment benefit schemes.
• Zakat and donations, including waqf, up to 5% of gross income.
• The interest or Islamic financing cost on a loan to build or buy a primary residence, once in a lifetime.
• Anything received by inheritance, will, or as a gift between spouses or first-degree relatives.
• Compensation of any kind, other than compensation for lost salary.

To see how this adds up, take someone earning 60,000 Rial Omani a year. The first 42,000 is not taxed, leaving 18,000. If they paid 6,000 Rial Omani in school fees for their children and 2,000 Rial Omani in medical bills for a parent that year, these are deducted, leaving 10,000 Rial Omani of taxable income and a tax bill of 500 Rial Omani.

Property, foreign income, and other exemptions

Property is handled carefully in article 20. The gain on selling a primary residence is exempt provided the sale takes place at least two years after the person notifies the Tax Authority that it is their primary residence, and the gain on selling a secondary residence, such as a farm or beach house, is exempt once in a lifetime. Both residences must be owned by a tax resident and chosen in advance by notifying the authority, and the choice of a secondary residence can only be made once. The practical lesson is that anyone who owns their home should notify the authority early, because the two-year clock only starts from that notification. Inheriting property, or receiving it as a gift from a spouse or first-degree relative, is not treated as a sale, so no tax arises at that point.

There are exemptions aimed at people working across borders, too. On top of all this, any foreign tax already paid on the same income can be deducted from the Omani tax due, up to the amount of the Omani tax.

Losses

Losses are dealt with in articles 26 and 27, and while most employees will never encounter them, they matter to anyone with a side business, a rental property, or investments. If self-employment, leasing, the sale of real estate, or the sale of shares and bonds produces a loss in a year, that loss is deducted from income from the same source, and whatever cannot be used is carried forward for up to five years. A loss from one source can never be set against income from another.

Take a person who earns a salary and also owns a flat they rent out. If, after deducting the actual expenses of the flat, the rent falls 3,000 Rial Omani short in a bad year, that 3,000 does not reduce the tax on their salary. It is carried forward and deducted from the rental income of the following year, and if that is not enough, the year after, for up to five years under article 26. If the flat keeps losing money for longer than that, what is left of the loss is simply gone.

Filing and paying

Under article 33, only a person whose gross income exceeds 42,000 Rial Omani needs to file a return, and it is filed electronically within six months of the end of the year. Someone whose only income is a salary or pension from a single employer can ask the employer to file on their behalf. In practice, most of the tax will never pass through the person’s hands. Employers must withhold the tax on salaries, pensions, and gratuities and pay it to the Tax Authority directly. Companies and government entities paying rent, dividends, and other kinds of income above 20,000 Rial Omani must also withhold part of the tax at source.

In short

For anyone earning below 42,000 Rial Omani, the new law changes nothing except that their employer will need to keep a closer eye on payroll. For those above it, the rate is low, the exemptions are wide, and most of the tax will be collected before the money reaches their account. What remains to be seen is the executive regulation, which Royal Decree 56/2025 requires the Chairman of the Tax Authority to issue, and which will set the procedures, forms, and the controls on the education, health care, and housing loan exemptions. We highly recommend that anyone earning above the threshold, and every employer, becomes familiar with the law before it enters into force in January 2028. You can read it in full in English on the link below:

Written by:

Abdulrahman Al-Farsi

Abdulrahman Al-Farsi is Legal Associate and Board Secretary at Decree. He holds an LLB from the University of Liverpool and had previously worked in an Omani law firm.

This regulation governs a specific type of children development centres that are open for any child to enter. Such centres aim to provide educational and developmental programmes and activities aimed at developing their skills and abilities. They are not specifically made for disabled children but they do provide programmes for the disabled.

The regulation sets building and safety standards, including surveillance cameras with at least three months of storage. It sets minimum qualifications for each staff role. It also fixes how many children each caregiver may look after: one caregiver for every four babies up to one year old, and one supervisor with one caregiver for every eight children aged one to two, or every twelve children aged two and above. Centres may not accept donations, and children with disabilities may make up no more than 15% of enrolment unless the ministry approves more.

These are only some of the key provisions of Ministerial Decision 378/2026, which has already entered into force. You can read it in full in English at the link below: