Oman - Are you the Responsible Person (Principal Officer) or have to appoint one for your company?

Introduction

This article discusses all the legal points that one needs to know mentioned in the Oman VAT law regarding the Responsible Person (or the Principal Officer).

Who is a Responsible Person (or the Principal Officer)?

In layman terms a Responsible Person (or the Principal Officer), is the person who the company (or the taxable person) appoints in their VAT Registration, who will be responsible for all their VAT obligations to the Oman Tax Authority.

Article 1 of the Oman VAT law defines Responsible Person as, ‘any person related through any relation to taxable person and who will represent taxable person in executing the obligations pursuant to the provisions of Oman VAT Law’.

In case a company does not appoint a Responsible Person, the Oman Tax Authority has the power to appoint one, that has a relation with the company’s activities.

According to Article 3 and 4 of the Oman VAT law, an appointed Responsible Person should not be outside Oman for a period exceeding 90 days during the Tax Year unless he has notified the Oman Tax Authority and the Authority has agreed to appoint another Responsible Person during the entire period of his absence.

Who can be a Responsible Person?

The following table mentions, who can be a Responsible Person depending upon the type of the company (according to Article 2 of the Oman VAT Law);

What are the responsibilities of a Responsible Person?

• A Responsible Person must ensure that all obligations under VAT law are correctly complied by the company, inter alia timely and correct filing of VAT returns and payment.

• The tax returns, financial statements, records, documents and others that are submitted by the company shall be considered signed by the Responsible Person and he shall be fully responsible for what company submits to the Oman Tax Authority.

• The Responsible Person has to be present if the Oman Tax Authority summons him on a set time and place specified in a notification sent for this purpose; in order to discuss matters related to transactions subject to tax pursuant to the provisions of the Oman VAT law, or matters related to the tax due.

What are the penalties that can be imposed on a Responsible Person?

The Oman VAT law is fairly strict as it has provision for imprisonment. Article 100 of the Oman VAT law states penalty of imprisonment for a period not less than 2 months and not exceeding 1 year, or a fine of not less than 1,000 OMR and not exceeding 10,000 OMR, or both.

A responsible person will be penalised if he deliberately fails to do either of the following;

• to notify the Authority and obtain its consent during the period of his absence for a period of more than ninety (90) days

• to appear before the Authority when requested, or

• to submit a Tax Return for any Tax Period

Also, in cases or recurrence the court may double the penalty amount and increase the imprisonment to the maximum of the legal threshold of punishment but not exceeding half this threshold.

Comments

All the above information is relevant if you are a Responsible Person (or the Principal Officer) for your company or have to appoint one for your company. Also pease find the list of details required for VAT registration. Click here

How we can help?

Our team is available to discuss and bring clarity to the specific challenges that your businesses will face in getting ready for VAT, that can be regarding registration, training employees, advisory on a legal position etc.

At Narayan Tax, we have organized VAT work streams that involve impact assessments, service design and implementation, as well as ongoing VAT technical analysis, advisory, training, project and change management.

We can help you through all phases of implementation, providing advice and recommendations for managing VAT compliance, addressing VAT costs and avoiding significant penalties.