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Jordan Tax Rate for 2016-2017, 2015-2016, 2014-2015

Jordan Payroll / Personal Income Tax Rate 2015

Effective from 1st January 2015

Taxable Income (JOD)

Tax Rate %

 

First 10,000

 

7%

 

Next 10,000

 

14%

 

Above

 

20%

 

 

 

In addition, please note that native persons (individuals / employees) shall be entitled to personal exemptions as follows:

- Personal exemption of JOD 12,000. (Provided that he stays in Jordan for more than 183 days during the calendar year whether continuous or interrupted.)

- Family Exemption of JOD 12,000. (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 4,000 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 3,500 in relation to the monthly Retirement Benefits instead of JOD 4,000 under the old Law.

Withholding tax of non- Resident services providers has been increased to be 10% instead of 7%.

Withholding tax 5% on real estate rent has been abolished.

Effectively 1st Jan 2015 specifies certain service providers to be subject to 5% retention. Those service providers are: Doctors, Lawyers, Engineers, Certified Public Accountants, Experts, consultants, Insurance Agents, Custom Clearing Agents, Arbitrators, speculators, Agents and brokers for commission, financial brokers, 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 has been increased to be 15% instead of 10%.

In-kind and in-cash dividends are not subject to withholding tax whether paid to a resident to non-resident party.

Social Security Updates:

According to Law No (1) of 2014, social security rates will be increased in 2015, 2016, and 2017. The increase will be 0.25% on employee share and 0.50% on employer share yearly. This will be fixed after 2017 when employee share will be 7.5% and employer share will be 14.25%.

Year

Employee

Employer
 

2015

 

7%

 

13.25%

 

2016

 

7.25%

 

13.75%

 

2017

 

7.5%

 

14.25%

 

Jordan Income Tax Rates 2014 and Deductions

Jordan Income Tax Rate for Individual Tax Payers

Lowest Individual Tax Rate is 10% and Highest Rate is 25%

Taxable Income (JOD)

Tax Rate %

 

First 10,000

 

10%

 

Next 10,000

 

20%

 

Above

 

25%


 

 

The new Income Tax Law also proposes to increase taxes in 2014 by lowering the personal exemption. Tax-resident persons would be entitled to an annual personal exemption of:

JOD 9,000 (down from JOD 12,000) for single tax-resident persons
JOD 18,000 for tax-resident families (down from JOD 24,000).

Jordan Corporate (Company) Tax Rates

Under this proposed Income Tax Law, corporate income tax rates applicable to most taxpayers liable for Jordanian tax (other than those described below) would be

15 percent of taxable income up to 100,000 Jordanian dinars (JOD)
25 percent of taxable income over JOD100,000

The corporate income tax rate would rise to 35 percent of all taxable income for banks, mining companies, insurance companies, financial companies, money exchange companies, financial leasing companies and major telecommunication companies. This represents an increase from the previous tax rates of 30 percent for banks and 24 percent for financial services companies and major telecommunication carriers.

Jordan Withholding Tax Rates

Finally, the proposed Income Tax Law would raise the withholding tax rate applicable to non-resident service providers to 10 percent.

Jordan Dates of filing Returns / Reporting and Payment

All persons subject to the tax to file the return on or before April 15 (unless the 15th is a Saturday or Sunday then file the next business day), regardless of whether or not tax is due. If you file a Federal or State Application for Extension, check the extension box on the front of the form and send this form along with your estimated payment by April 15, unless the 15th is a Saturday or Sunday, then by the next business day. If you use a professional tax preparer, confirm that they will submit your final return for you.

 

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