As a taxable entity, there might be instances where you overlook
specifying that the contract amount excludes VAT. While this
omission may seem minor, it can raise questions about whether you
are entitled to later request VAT payment from your clients on the
agreed contract amounts. To better understand this scenario,
let's examine it based on the provisions of the Omani VAT Law
and its Executive Regulations.
Key Question
How is VAT calculated in contracts that do not explicitly state
whether the contract value excludes VAT, and who is responsible for
paying it?
According to the Omani VAT Law (Royal Decree No. 121/2020) and
its Executive Regulations, particularly Article 211 of the
Executive Regulations, the Omani legislator has provided clear
guidelines on how VAT is treated in cases where the contract does
not explicitly address this tax.
