Jordan: Taxes and Costs

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Last Updated: Mar 19, 2007

Effective rental income taxes are low in Jordan

Effective Tax Rate on Rental Income
Monthly Income	US$1,500	US$6,000	US$12,000
Tax Rate	nil	1.9%	5.0%
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Source:			Disclaimer

Income Tax

Net rental income is taxed in Jordan. A married couple can file either joint or separate tax returns.

Income-generating expenses such as repairs, taxes and fees, management costs, and depreciation are deductible from the gross rent. The depreciation rate is 2% annually but the rate can be doubled for tax purposes.

However, 15% of the net rental income derived from properties located within Amman greater municipality is exempted from tax. The tax-exempt amount for other areas in the Kingdom is 30% of the net rental income.

INCOME TAX
TAXABLE INCOME, JOD (US$)	TAX RATE
Up to 2,000 (US$2,803)	5%
2,001 – 6,000 (US$8,408)	10%
6,001 – 14,000 (US$19,618)	20%
Over 14,000 (US$19,618)	25%

The annual income tax liability is further subject to social services tax which is levied at 10%.

Real Estate Tax

Real estate taxes paid on rented real estate is treated as tax credit and deducted from the income tax due. The 10% real estate tax is levied on 80% of the annual rental income [(annual rental income x 80%) x 10%].

Zakat

Muslims are liable to pay zakat on their income. The zakat can be deducted from their taxable income up to a maximum of 25% of the taxable income.

Jordan - more data and information

Guide to buying houses and registering property sales in Jordan