Jordan’s standard VAT rate is 16%, the social security rate is 21.75%, the corporate income tax rate is 20% and the personal income tax (PIT) rate is 30% but applied in bands as follows:
Payroll / Personal Income Tax Rates:
|Taxable Income *
|Over 20,000 up to 1,000,000
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 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 2022 remains at 21.75% – made up of 14.25% employer contribution and 7.5% employee contribution and has been in place since 2017.
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