A major attraction for expats living and working in Oman is the tax-free income, and foreigners will be happy to hear that opening and running a bank account is easy and efficient.  

Money in Oman

The currency used in Oman is the Rial (OMR), which is divided into 1,000 baisa or baiza. Below are frequently used banknotes and coins:

  • Notes: 100 and 200 baisa, OMR 1/2, 1, 5, 10, 20 and 50

  • Coins: 5, 10, 25, and 50 baisa

Oman has a strong and relatively stable currency, and getting used to it may take time for some expatriates. New arrivals can usually get rials from their banks in their home country and, provided their banks allow international use, cash can be withdrawn from ATMs and exchanged at the airport and foreign exchange bureaux. We do recommend expats check the bank charges and exchange rates when exchanging money for the rial.

Banking in Oman

Along with the Central Bank of Oman, trustworthy local banks include Bank Dhofar, Bank Muscat, National Bank of Oman and Oman Arab Bank. There are a host of foreign banks with branches – many of these offer multilingual services, such as HSBC Oman.

Alternatively, expats staying short term can open an international, multi-currency account through their bank in their country of origin. International accounts can be opened before leaving home and will provide access to a wide range of international banking services, such as high-interest savings options and online money transfer services. Many expats praise the convenience and simplicity of having their finances centralised in this way.

Opening hours for banks in Oman are 8am to 2pm from Sunday through Thursday, and are either shut on Fridays and Saturdays or open only in the morning. During Ramadan, banks usually open an hour later in the mornings (at 9am).

Opening a bank account

Not all new arrivals will need to open a bank account, but those who choose to do so will find it fairly straightforward. The required documents vary between banks and bank account types, but normally foreign citizens need to show their proof of residence and their valid passport. 

There have been strict rules on foreigners working in the Sultanate, and while tax forms relieve expats of paperwork, the infamous No Objection Certificate (NOC) has been a frustrating formality with firm regulations. Employers provide a NOC which states monthly salaries and may be needed when opening a bank account in the country. Changes to NOC regulations have been relaxed recently so it is best to check necessary arrangements with the bank and employer.

Note that it is sometimes easier to open a bank account in Oman with an employer's bank, as any problems with the payment of salaries can be sorted out with maximum efficiency.

ATMs and credit cards

The Sultanate has been known to be cash-intensive, with taxis generally only allowing cash transactions. There is somewhat of an aversion and distrust of credit cards in Oman but, like other countries, it is evolving and adapting. To stay competitive, banking has made online purchases and transactions much easier and expats should be able to use their bank cards throughout the country.

ATMs are widespread, and most of them will accept international cards. Omani bank cards can be used at any ATM, but withdrawals may be subject to fees if using a machine operated by a different bank. Visa and Mastercard credit cards are widely accepted; American Express and Diners Club less so.

Overdraft facilities are available in Oman, but a general distrust of foreign account holders prevails, so expats may be called in to explain large discrepancies. Do not bounce a cheque in Oman – even if it is an honest mistake, it could lead to dire consequences.

Taxes in Oman

One of the great incentives for moving to Oman is that there is no personal or income tax levied against monthly salaries. There are not endless amounts of paperwork and tax forms to be completed, and no returns to file with the Ministry of Finance. That said, income tax for the wealthy will begin in Oman in 2022. 

Businesses are subject to income tax and must make social security contributions. This won't affect expats as the law pertains to Omani employees employed permanently in the private sector. Omani employers must make social security contributions for their local employees which covers old age, disability, death and occupational injuries.

Another attractive incentive for expats is that they are entitled to receive gratuity or end-of-service benefits, including receiving 15 days' worth of their basic salary for the first two years of continuous service and 30 days' worth for each year that follows.

Don't get too carried away though, foreigners may be subject to withholding tax. This applies to expats who do not carry activities in Oman through a Permanent Establishment (PE) but receive an income. This is charged at a rate of 10 percent. To understand the implications of this it may be necessary to contact a tax specialist.

New arrivals are strongly advised to research whether a double taxation agreement exists between Oman and their country of origin. If no such agreement exists, they may have to pay tax in their country of origin on the money they earn in Oman.

*Tax regulations are subject to change at short notice and expats are advised to seek the assistance and advice of a professional tax consultant.