Not every income tax return in Jordan is audited. A tax returns committee selects annual samples of returns for audit; if a taxpayer's return does not fall within the selected sample it is deemed legally accepted, while for selected returns the auditor issues an audit memo followed by a reasoned decision within deadlines set by law.
Selecting samples for audit
The Tax Returns Committee, formed by the Minister of Finance from six Department employees in addition to the Director, selects the tax returns subject to audit according to annual sampling criteria. The annual tax returns of taxpayers whose returns are not included in the selected samples are deemed legally accepted, and the taxpayers are notified accordingly.
Reopening a legally accepted return
Despite a return being legally accepted, the Director, or an auditor authorized in writing by the Director, may reconsider that return within two years from the date it was filed or the amended return was filed, if there is an error in the application of the law or an omission of a fact, event, or source of income that was not previously addressed.
The audit memo and the audit decision
Unless the Director decides in writing to extend the audit period because the Department has evidence, data, or information warranting an extension, the auditor must issue the audit decision on a return included in the selected samples within one year from the date the audit memo is issued, failing which the return is deemed accepted by operation of law; if the auditor finds grounds not to accept it wholly or partly, an audit memo is issued inviting the taxpayer to a session to discuss it, containing the date of the memo, the taxpayer's name and tax number, the period or periods covered, and the place, date, time, and auditor's name. The auditor must issue the audit decision within two years from the date the audit memo is issued, containing the taxpayer's name and tax number, the tax period, the basis relied on in the audit, its outcome, and the amount of tax due. If the decision includes no adjustment, the return is deemed accepted; if it includes an adjustment, the taxpayer may agree or disagree, and in either case is notified in writing of the decision's outcome and reasons.
The maximum time limit for an audit
The auditor may not issue the written notice of the audit decision after four years have passed from the date the tax return was filed or amended, unless there is evidence of tax evasion, in which case this period is doubled. If the audit decision includes an adjustment to the return, the taxpayer may object to it before the Objection Authority.
Legal References
- Income Tax Law No. 34 of 2014 and its amendments — Article 27 (amending the return within two years)
- Income Tax Law No. 34 of 2014 and its amendments — Article 28 (Tax Returns Committee, sampling and the audit memo)
- Income Tax Law No. 34 of 2014 and its amendments — Article 29 (audit decision and the four-year time limit)
For questions about your specific situation, you can ask the Jordan Tax & Legislation Helper on Helpers, or consult a licensed chartered accountant.