Jordan Cross-Border Tax Guide

Transfer Pricing — OECD-Aligned Rules

Jordan's transfer pricing rules are governed by the Income Tax Law and follow OECD Transfer Pricing Guidelines. All related-party transactions must be conducted at arm's length. Key requirements include mandatory transfer pricing documentation for transactions exceeding specified thresholds, master and local file requirements consistent with OECD BEPS Action 13, and Country-by-Country (CbC) reporting for multinational groups with consolidated revenue above the threshold. Advance Pricing Agreements (APAs) are available for taxpayers seeking certainty on transfer pricing methodology.

Withholding Tax on Outbound Payments

Payments to non-residents are subject to withholding tax at the following standard rates (subject to DTA reductions):

• Dividends: 0% (no withholding tax on dividends under Jordanian law)
• Interest: 10%
• Royalties: 10%
• Management and technical fees: 10%
• Rental income: 10%

The withholding tax is deducted by the Jordanian payer and remitted to ISTD. Treaty relief requires the non-resident to provide a certificate of residence from their home tax authority.

Double Tax Treaty Network — ~45 Treaties

Jordan has one of the most extensive DTA networks in the Middle East, with approximately 45 treaties in force including with the UK, Canada, Germany, France, Netherlands, Italy, Turkey, Egypt, UAE, Saudi Arabia, Kuwait, Qatar, Bahrain, Oman, Algeria, Morocco, Tunisia, Sudan, Syria, Lebanon, Libya, Yemen, and others. Key treaty rates for outbound payments vary, but typical reductions include interest reduced to 5–7% and royalties reduced to 5–8% under most treaties.

Thin Capitalisation Rules

Jordan has thin capitalisation rules limiting the deductibility of interest on related-party borrowings where the debt-to-equity ratio exceeds 2:1. Disallowed interest may be carried forward. Third-party debt is generally not subject to thin cap rules unless guaranteed by a related party.

Foreign Tax Credit

Jordan provides a unilateral foreign tax credit for taxes paid abroad on foreign-source income. The credit is limited to the lower of the foreign tax paid and the Jordanian tax attributable to that income (per-country limitation). Excess foreign tax credits cannot be carried forward or backward. Where a DTA exists, treaty provisions for relief from double taxation apply.

FAQs

Do I need to register for tax in Jordan if I am a non-resident earning Jordanian-source income?

Yes, non-residents earning income from Jordanian sources (interest, royalties, rental income, or business income through a PE) must register with ISTD and file tax returns on that income.

How can a non-resident claim treaty benefits?

The non-resident must provide a certificate of residence from their home tax authority to the Jordanian payer. The payer then applies the reduced treaty withholding rate.

Does Jordan have exit tax for companies emigrating?

Jordan does not impose an exit tax on companies or individuals ceasing to be Jordanian tax residents.

Disclaimer

This guide provides general information about Jordanian cross-border taxation for the 2026 tax year. Tax laws and treaty rates may change. Always consult with a qualified Jordanian tax advisor or the Income and Sales Tax Department for advice specific to your situation. InvestmentKit does not provide tax advice.