Amman
EY Street address:
Mail address:
300, King Abdullah Street
P.O. Box 1140 Amman Amman 11118 Jordan Jordan
Executive and immigration contacts
Ali Samara
Jacob Rabie
Abdullah Al-Husban
Mohammad Allouzi
Hanin Samhouri
Xavier Delaunay
+962 (6) 580-0777
Fax: +962 (6) 553-8300
Email: ali.samara@iq.ey.com
+962 (6) 580-0777
Fax: +962 (6) 553-8300
Email: jacob.rabie@jo.ey.com
+962 (6) 580-0777
Fax: +962 (6) 553-8300
Email: abdullah.al-husban@jo.ey.com
+962 (6) 580-0777
Fax: +962 (6) 553-8300
Email: mohammad.allouzi@jo.ey.com
+962 (6) 580-0777
Fax: +962 (6) 553-8300
Email: hanin.samhouri@jo.ey.com
+971 (56) 406-1072 (resident in Dubai,
Email: xavier.delaunay@ae.ey.com United Arab Emirates)
A. Income tax
Who is liable. Jordanian nationals and foreign individuals working in Jordan are subject to tax in Jordan on their income earned in, or derived from, Jordan, regardless of their residency status.
An individual is considered a resident of Jordan for tax purposes if he or she resides in Jordan for a period of at least 183 consecutive or non-consecutive days per calendar year.
Income subject to tax
Ordinary income. Income tax is assessed on all income earned by residents and nonresidents of Jordan from taxable activities performed in Jordan, including employment income and rental income. The income tax is levied at the graduated rates set forth in Rates.
Interest income. For natural persons, interest income is subject to withholding tax at a rate of 5%. Banks are required to withhold at source the tax from the interest.
Other income. Net income realized by a resident of Jordan from foreign sources is taxable in Jordan at a rate of 10% if such income is generated from Jordanian monies or deposits.
For the types of income subject to tax described above, a national contribution tax of 1% is levied on the annual taxable income of natural persons exceeding JOD200,000.
Capital gains. Capital gains resulting from the sale of shares in Jordan are taxable at different rates.
For the sale of shares on the Amman Stock Exchange by natural persons, general partnerships, limited partnerships and nonresidents in Jordan, the buyer and seller are subject to income tax at a rate of 0.08% of the shares’ sales price for each sales transaction. For other direct sales of shares by natural persons in Jordan, capital gains tax is calculated based on either of the following:
• Graduated tax rates ranging from 0.5% to 5% applied to the gross sale consideration
• The domestic personal income tax rates, set forth in Rates, applied to the capital gains
For other direct sales of shares transactions by nonresident natural persons in Jordan, the Jordanian Income and Sales Tax Department (ISTD) may apply a withholding tax at a rate of 10% on the capital gains derived by the nonresident natural person from the transaction.
A tax rate of 10% applies to the capital gains from the sale of shares outside Jordan, provided that such gain is generated from Jordanian monies or deposits.
A national contribution tax of 1% may also be applicable if the capital gains exceed JOD200,000 annually.
For residents, the capital gains tax should be due as part of the normal annual tax return filing process for the period in which the transaction occurs for residents.
For nonresidents, prior to the closing date of the transaction, a tax clearance certificate must be obtained from the ISTD, and the capital gains tax must be paid.
Deductions
Personal and family allowances. The following annual allowances are granted from 2020 onward.
JOD
Personal allowance 9,000
Dependents allowance 9,000
Additional allowances for payments 1,000 for of medical expenses, educational individuals, expenses, rent, home loan 1,000 for spouses, interest or Murabaha (interest paid and 1,000 for by banks applying Islamic banking each child up to principles), technical services, 3,000 engineering services and legal services
Business deductions. In general, business expenses incurred in generating income are deductible. However, certain limitations apply.
An applicant may not begin working in Jordan before obtaining work and residency permits. Work and residency permits may not be transferred from one employer to another; therefore, if an employee changes his or her employer, the previous work and residency permits must be canceled, and the employee must apply for new work and residency permits.
The work and residency permits are valid for one year and may be renewed on an annual basis.
As a prerequisite to obtain work and residency permits, the Ministry of Labor requires the employer to submit a bank letter of guarantee to the order of the Ministry of Labor for each expatriate employee seeking work and residency permits in Jordan.
Under the Jordanian Labor Law, certain occupations are exclusively reserved to Jordanians and may not be filled by nonJordanians, such as those in the following fields
• Hairdressing
• Upholstery and furniture renovation
• Dessert, pastry or ice cream production for direct sale to consumers
• Carpentry
• Blacksmithing
• Aluminum fabrication
• Metal processing
Non-Jordanians are also prohibited from working in settings such as workshops, including those for embroidery, traditional sewing, goldsmithing and jewelry crafting, as well as pure-water bottling facilities, the manufacturing of ceramic and pottery items, dry cleaning and ironing services, and facilities for nut roasting and direct sale packaging.
Foreign investors may engage in almost any type of economic activity. In general, Jordan does not impose limitations on foreign investments. Except for certain sectors, including construction and trade, in which foreign ownership is limited by a certain percentage, non-Jordanians may have full ownership in any economic project in Jordan. Full ownership by a foreign investor is permitted in the following sectors:
• Agriculture
• Hotels
• Health care
• Mining
• Industrial
• Telecommunications
In addition, full ownership by a foreign investor is permitted for investments in Jordanian free zones and development zones, regardless of the sector.
H. Family members
The spouse of a foreign national who has a work permit in Jordan does not automatically receive the same type of work permit as the spouse holding the work permit. He or she must file independently of the primary work-permit holder if he or she also wants to work in Jordan.