Tax in Qatar

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Updated 2023-06-18 12:09

Qatar introduced an income tax law in 2018, which imposes a tax of 10% on Qatar-sourced income earned by individuals or resident corporate bodies. The law also exempts certain types of income, such as salaries, wages, and allowances.

Qatar has also introduced a value-added tax (VAT) of 5%, which is effective from January 1, 2023. The VAT applies to most goods and services supplied in Qatar, with a few exceptions, such as basic food items and healthcare services.

Income tax in Qatar

The income tax law introduced in 2018 applies at a rate of 10% on Qatar-sourced income earned by individuals or resident corporate bodies. The law also exempts certain types of income, such as salaries, wages, and allowances.

Taxable income is defined as all income earned in Qatar, regardless of the source. This includes income from salaries, wages, business profits, rent, dividends, interest, and capital gains.

Individuals are considered taxable residents of Qatar if they have a permanent home in Qatar or if they stay in Qatar for more than 183 days in a calendar year. Corporate bodies are considered taxable residents of Qatar if they are incorporated in Qatar or if they have a permanent establishment in Qatar.

The following types of income are exempt from income tax in Qatar:

  • Salaries, wages, and allowances
  • Pensions
  • Social security benefits
  • Interest on savings accounts
  • Dividends from Qatari companies
  • Capital gains from the sale of real estate in Qatar

Tax year in Qatar

The tax year in Qatar is the calendar year. Individuals and corporate bodies are required to file an income tax return by the end of March following the end of the tax year.

Double taxation agreements (DTA) in Qatar

Qatar has a number of non-double taxation agreements with other countries. These agreements aim to prevent double taxation of income by both Qatar and the other country.

Here are some of the countries with which Qatar has non-double taxation agreements:

  • Austria
  • Belgium
  • China
  • Denmark
  • Finland
  • France
  • Germany
  • Greece
  • India
  • Indonesia
  • Italy
  • Japan
  • Korea, Republic of
  • Kuwait
  • Lebanon
  • Luxembourg
  • Malaysia
  • Netherlands
  • Norway
  • Oman
  • Pakistan
  • Philippines
  • Portugal
  • Russia
  • Saudi Arabia
  • Singapore
  • South Africa
  • Spain
  • Sweden
  • Switzerland
  • Turkey
  • United Arab Emirates
  • United Kingdom

Tax returns in Qatar

The Qatari tax authorities have a number of methods for collecting income tax, including:

Self-assessment: Individuals and corporate bodies are required to self-assess their income tax liability and file an income tax return.

Withholding tax: Employers are required to withhold income tax from the salaries of their employees.

Quarterly payments: Corporate bodies are required to make quarterly payments of estimated income tax liability.

The Qatari tax authorities have the power to audit taxpayers' records and to impose penalties for non-compliance with the income tax law.

It is important to note that the tax laws of Qatar are complex and may change from time to time. It is always advisable to consult with a tax advisor to ensure that you are in compliance with the law.

Corporate tax in Qatar

Corporate tax in Qatar is applied at a flat rate of 10%. This means that all corporate profits are taxed at the same rate, regardless of the amount of profit. There are a few exceptions to this rule, such as for companies that are wholly owned by Qatari nationals or GCC nationals. These companies are exempt from corporate tax.

Companies are required to file their corporate tax return by the end of March following the end of the tax year.

Taxable income is defined as all income earned in Qatar, regardless of the source. This includes income from business profits, rent, dividends, interest, and capital gains.

Companies are considered taxable residents of Qatar if they are incorporated in Qatar or if they have a permanent establishment in Qatar.

The following types of income are exempt from corporate tax:

  • Profits from the sale of real estate in Qatar
  • Dividends from Qatari companies

Here are some of the common corporate tax deductions in Qatar:

  • Business expenses: All reasonable business expenses are deductible, including salaries, rent, utilities, travel expenses, and marketing expenses.
  • Depreciation: Companies can depreciate the cost of their assets over a period of time.
  • Investment allowances: Companies can claim investment allowances for certain types of investments, such as new buildings and machinery.
  • Loss carryforward: Companies can carry forward losses from one year to the next.

The Qatari tax authorities have a number of resources available to help taxpayers, including:

  • The General Tax Authority (GTA) website: The GTA website provides information on the tax laws of Qatar, including the corporate tax law.
  • The GTA call center: The GTA call center can provide information on the tax laws of Qatar and answer questions from taxpayers.
  • The GTA tax offices: The GTA has tax offices located throughout Qatar. These offices can provide assistance to taxpayers with their tax returns and other tax matters.

VAT in Qatar

Value-added tax (VAT) is a consumption tax that is applied to most goods and services supplied in Qatar. The VAT rate is 5%.

The VAT was introduced in Qatar on January 1, 2023. The introduction of the VAT was part of a wider economic reform program aimed at diversifying the economy and reducing the country's reliance on oil and gas.

The VAT is administered by the General Tax Authority (GTA). The GTA is responsible for collecting the VAT, enforcing the VAT law, and providing taxpayers with information and assistance.

The VAT is a destination-based tax. This means that the VAT is applied to goods and services supplied in Qatar, regardless of where the supplier is located.

There are a number of goods and services that are exempt from VAT, including:

  • Basic food items
  • Healthcare services
  • Education services
  • Financial services
  • Insurance services
  • Postal and telecommunications services
  • Transport services
  • Accommodation
  • Cultural and sporting events

The VAT is a complex tax, and there are a number of rules and regulations that businesses need to be aware of. It is advisable for businesses to seek professional advice to ensure that they are compliant with the VAT law.

Here are some of the key points about VAT in Qatar:

  • Taxable supplies: VAT is applied to most goods and services supplied in Qatar, with a few exceptions.
  • Tax rate: The VAT rate is 5%.
  • Taxable persons: Businesses that supply taxable goods and services in Qatar are required to register for VAT.
  • Registration: Businesses must register for VAT if their taxable turnover exceeds QR500,000 in a calendar year.
  • Self-assessment: Businesses are required to self-assess their VAT liability and file a VAT return on a quarterly basis.
  • Withholding tax: Businesses are required to withhold VAT from payments made to non-resident suppliers.
  • Reclaim: Businesses can reclaim the VAT that they have paid on their business expenses.
  • Penalties: Businesses that fail to comply with the VAT law may be subject to penalties.

VAT is a new tax in Qatar, and the GTA is still working to develop the administrative and enforcement framework. However, the GTA has made a number of important steps to ensure that the VAT is implemented smoothly and efficiently. These steps include:

  • Publishing a comprehensive VAT law
  • Developing a VAT registration system
  • Establishing a VAT helpline
  • Conducting a public awareness campaign

The GTA is committed to ensuring that the VAT is a fair and efficient tax that contributes to the development of the Qatari economy.

Excise tax in Qatar

Excise tax is a consumption tax that is applied to certain goods and services, such as alcohol, tobacco, and energy drinks. The excise tax rate varies depending on the good or service.

The following goods and services are subject to excise tax in Qatar:

  • Tobacco products: 100% tax rate.
  • Carbonated drinks (non-flavored aerated water excluded): 50% tax rate.
  • Energy drinks: 100% tax rate.
  • Special goods: 100% tax rate.

The excise tax is collected by the General Tax Authority (GTA). The GTA is responsible for collecting the excise tax, enforcing the excise tax law, and providing taxpayers with information and assistance.

The excise tax is a destination-based tax. This means that the excise tax is applied to goods and services supplied in Qatar, regardless of where the supplier is located.

There are a number of goods and services that are exempt from excise tax, including:

  • Basic food items
  • Healthcare services
  • Education services
  • Financial services
  • Insurance services
  • Postal and telecommunications services
  • Transport services
  • Accommodation
  • Cultural and sporting events

The excise tax is a complex tax, and there are a number of rules and regulations that businesses need to be aware of. It is advisable for businesses to seek professional advice to

Customs duty in Qatar

Customs duty is a tax on goods imported into Qatar. The customs duty rate varies depending on the type of good.

Qatar is a member of the Gulf Cooperation Council (GCC) Customs Union, which means that it has a common set of customs duties for goods imported into the GCC countries.

The general customs duty rate in Qatar is 5%. However, there are a number of goods that are subject to higher or lower customs duties, including:

  • Alcoholic beverages: Alcoholic beverages are subject to a 100% customs duty.
  • Tobacco products: Tobacco products are subject to a 100% customs duty.
  • Pork and pork products: Pork and pork products are prohibited from importation into Qatar.
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