Singapore and Jordan Sign Avoidance of Double Taxation Agreement

14 Jul 2021

  1. The Agreement between the Government of the Republic of Singapore and the Government of the Hashemite Kingdom of Jordan for the Elimination of Double Taxation with respect to Taxes on Income and the Prevention of Tax Evasion and Avoidance (“DTA”) was signed today.
  2. The signing took place virtually between Ms Indranee Rajah, Minister in the Prime Minister's Office, Second Minister for Finance and National Development, Republic of Singapore, and Dr Mohamad Al-Ississ, the Minister of Finance of the Hashemite Kingdom of Jordan.
  3. The DTA clarifies the taxing rights of both countries on all forms of income flows arising from cross-border business activities, and minimises the double taxation of such income. This will lower barriers to cross-border investment and boost trade and economic flows between the two countries. Key terms of the Agreement can be found in the Annex.
  4. The full text of the DTA is available on the Inland Revenue Authority of Singapore’s website here. The DTA will enter into force after ratification by both countries.

Ministry of Finance 


Annex: Summary of key terms in the Singapore-Jordan DTA

 

 Article in the DTA Key terms in the DTA


Article 5, Permanent Establishment

  •  Period test of 9 months for construction-related activities, beyond which residents of a contracting state could trigger a taxable presence in the other contracting state
  • Period test of 183 days in any 12-month period for the furnishing of services, beyond which residents of a contracting state could trigger a taxable presence in the other contracting state

 

Article 10, Dividends

  •  5% withholding tax rate (if shareholding ≥ 10%)
  • 8% withholding tax rate (other cases)
 Article 11, Interest 
  • 5% withholding tax rate 
 Article 12, Royalties
  •  5% withholding tax rate