VAT Refund in Oman

Yarab A | Updated on: May 30, 2022

What should businesses do with excess input VAT?
How to Claim VAT Refund while filing VAT return?
How to apply for a refund if the amount is less than 100 OMR?
How TallyPrime can help?

Filing VAT returns is a mandatory compliance requirement that all VAT registered businesses should adhere to. In VAT return, one must declare the value of sales, purchases, output VAT and input VAT paid during the tax period. In the process of filing VAT returns, the businesses are allowed to adjust input VAT with the output VAT and arrive at the payable.

FAQs on Oman VAT Return

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Depending upon the value of input VAT and output VAT, the outcome will be either VAT payable or VAT refundable. If the output VAT amount is higher than the input VAT, the balance will be VAT payable, which businesses must pay to authorities. In case the output VAT is less than the input VAT, the excess will be called VAT Refundable

What should businesses do with excess input VAT?

Businesses have the following two options to utilise the VAT refundable, i.e. excess of input VAT over output VAT.

Businesses will be eligible to request a VAT refund at the time of filing a VAT return. This is allowed only if the VAT refund amount exceeds 100 OMR
If they do not wish to ask for a refund, the excess input VAT will be carried forward to subsequent tax periods and can be used to offset the payable tax

In case if they have missed applying for a VAT refund while filing VAT returns, businesses can apply for a refund at any point in time, but within 5 years from the end of the tax period in which refund right arose.

How to Claim VAT Refund while filing VAT return?

If the VAT return’s outcome is a VAT refund, i.e., input VAT claimed is higher than the output VAT, businesses will be allowed to apply for a VAT refund. This provision is applicable only if the VAT refund amount exceeds 100 OMR. You can follow the below process to apply for a VAT refund:

Tick “I want to be refunded” check box available at the time of submitting the VAT return
If it is unchecked, the excess recoverable tax will be carried forward to subsequent tax periods and can be used to offset VAT payable
Download “Taxpayer Checklist” excel sheet from the Oman VAT website
Furnish the required details in the excel sheet and attach it to the VAT return form

The tax authorities will normally decide on the payment within 30 days, and the repayment should be processed within a further 15 days if authorised.

How to apply for a refund if the amount is less than 100 OMR?

If the amount to be refunded is under 100 OMR or the taxable person does not request repayment when submitting the return, the excess amount will be carried to future periods. In such cases, at the end of the tax year, the taxable person may request a refund of any amount due provided they submit a request by the due date for the first tax period of the new Tax Year.

However, all such refund requests should be made within 5 years from the end of the tax period in which the right arose; otherwise, the amount will be forfeited.

How TallyPrime can help?

TallyPrime, a business management software in Oman is now enhanced to support Oman VAT. TallyPrime makes the process of VAT compliance seamless and efficient. With TallyPrime, all you need to do is 3-4 simple steps to get started. Using TallyPrime, you can record and generate tax invoices, print bilingual tax invoices, manage all types of supplies, generate Vat accurate returns, and much more.

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