Jordan Tax Rate Updates: Key Insights on Tax and Social Security
Payroll / Personal Income Tax Rates:
| Taxable Income * | Rate |
| First JOD 5,000 | 5% |
| Second JOD 5,000 | 10% |
| Third JOD 5,000 | 15% |
| Fourth JOD 5,000 | 20% |
| Over JOD 20,000 up JOD to 1,000,000 | 25% |
In addition, please note that native people (individuals/employees) will be entitled to personal exemptions as follows:
- Personal exemption of JOD 9,000. (Provided that he stays in Jordan for more than 183 days during the calendar year whether continuous or interrupted.)
- Family Exemption of JOD 9,000. (Provided that his family stays in Jordan for more than 183 days during the calendar year whether continuous or interrupted.)
- Additional Personal and family exemption of JOD 3,000 on Medical Expenses, University Education Expenses and Interests paid on Housing Loans, Housing rent, technical services, engineering services, legal services provided that supporting documents and invoices are available and to be granted on a case by case basis after reviewing the related supporting documents by the Income Tax Department.
- Exemption in the amount of JOD 2,500 in relation to the monthly Retirement Benefits.
Withholding Taxes
- Withholding tax of non-resident services providers remains at 10%
- Certain service providers are subject to 5% retention. This includes doctors, lawyers, engineers, certified public accountants, experts, consultants, insurance agents, custom clearing agents, arbitrators, speculators, agents and brokers for commission, financial brokers and freight forwarders. Any other persons will be determined according to the related regulations which will be issued for this purpose by the Minister of Finance.
- Withholding tax on in cash and in-kind prizes and Jordanian Lottery in excess of JOD 1000 per each prize is 15%.
- In-kind and in-cash dividends are not subject to withholding tax whether paid to a resident to non-resident party.
Social Security Updates:
Jordan’s new social security rate in 2024 remains at 21.75% – made up of 14.25% employer contribution and 7.5% employee contribution and has been in place since 2017.
| Year | Employee | Employer |
| 2019 | 7.5% | 14.25% |
| 2020 | 7.5% | 14.25% |
|
2021 |
7.5% | 14.25% |
|
2022 |
7.5% |
14.25% |
|
2023 |
7.5% |
14.25% |
Conclusion
As we navigate through the evolving landscape of tax and social security regulations in Jordan, staying ahead of these changes is paramount for ensuring compliance and optimising your business operations. The updates for 2024 bring about both challenges and opportunities. By understanding and adapting to these changes, your business can continue to thrive in Jordan’s dynamic market. Remember, TopSource Worldwide is here to support you every step of the way. Whether it’s through our advanced Employee Cost Calculator or our tailored advisory services, we’re committed to helping you manage your payroll and tax obligations efficiently and effectively.
Want to remove the headache of ever-changing Jordan payroll and HR legislation? Get in touch with one of our consultants to find out more about Topsource’s fully managed payroll and EOR services.
Nena Petrovic is the Client Advisor Team Leader at TopSource Worldwide, a leading Global Expansion services provider. She oversees and guides a team of client advisors, who communicate and collaborate with clients effectively. She is responsible for ensuring the accurate and timely processing of client invoices and payroll, as well as developing strategies and maintaining a client-centric approach.