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May 15, 2026

Article 121 establishes the mechanism for a 'Foreign Tax Credit' to avoid international double taxation. When Omani-taxable income has already been taxed in a treaty country, the taxpayer is entitled to deduct the foreign tax paid from their Omani tax liability. This deduction applies only if the foreign tax relates to income that forms part of the Omani taxable income for that year. This ensures that the same profit is not fully taxed twice—once by the source country and once by Oman—promoting cross-border investment by Omani entities.

Part 4 - Avoidance of Double Taxation

Chapter 1 - Avoidance of International Double Taxation

Article 121

[GTL Notes: Foreign Tax Credit]

In the application of the provisions of any international agreement for the avoidance of double taxation, the foreign tax paid in respect of the income which was charged to tax in the country with which Oman has concluded that agreement, shall be deducted from the tax payable on its taxable income in Oman of the tax year of which the income charged to the tax in that country forms a part.