Oman Tax Authority sets strict terms for corporate expense deductions

MUSCAT: The Tax Authority has officially published Decision No. 180/2026, introducing crucial amendments to the Executive Regulation of the Income Tax Law.

The decision, issued by the Chairman of the Tax Authority, Nasser bin Khamis bin Ali Al Jashmi, inserts Article (18 bis) to clarify the regulatory requirements for deductible corporate expenses incurred under decisions issued by state administrative bodies and public entities.

Key Rules for Expense Deductions
Under the newly introduced Article (18 bis), businesses seeking to deduct expenses resulting from administrative directives must meet three strict conditions:

The expenses must be strictly essential for carrying out the business's core activities.

 The deduction must be explicitly permitted by the Chairman of the Tax Authority.

 The deduction must not result in a breach or default of any legal obligation, regardless of its origin.

The decree repeals any prior regulations that conflict with its terms. While published in the Official Gazette on July 20, 2026, the provisions will formally take effect starting from the tax year beginning January 1, 2027.