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Personal Taxation in Egypt
 
 
 

General

Individual income tax rates in Egypt are progressive, up to 20%. Income tax is imposed on the worldwide income of Egyptian residents. Non-residents are subject to tax on income earned or realised in Egypt.

Progressive rates up to 20% on income over £E40,000 per year. Non-resident and resident employees who derive income from sources other than their original place of employment are subject to tax at a flat rate of 10%.

Individuals are not subject to a tax on capital gains except in the case of the disposal of real estate or building sites within the boundaries of Egyptian cities. Such gains are not subject to income tax but are taxed at the rate of 2.5% on the value of the property.

Resident individuals are taxed on their worldwide income; non-residents are taxed only on their Egyptian-source income. An individual is resident if he/she:

• is present in Egypt for more than 183 days in a fiscal year; or
• is deemed to have a permanent residence or a local commercial presence in Egypt under Executive Regulations; or
• resides abroad but maintains income from Egyptian sources.

Employers generally are responsible for withholding and paying the salary tax due to the relevant tax authorities on a monthly basis. However, if the employee is paid from an offshore source, the individual is required to declare it to the relevant authorities at the end of the year.

Taxable Income

This includes income from employment, commercial or industrial activities and non-commercial activities (i.e. the exercise of a profession). Mandatory profit sharing, pensions and end-of-service bonuses are not subject to salary tax.

Capital Gains

Individuals are subject to tax on capital gains if the assets are sole proprietorship assets (including real estate). If not classified as sole proprietorship assets, real estate gains are subject to a separate tax of 2.5% on the gross gains.

Tax Deductions & Tax Allowances

Available deductions depend on the type of income. Various allowances are available for items such as social security contributions and health insurance premiums.

Other Taxes

Capital Duty

No.

Stamp Duty

Stamp duty applies at various rates depending on the type of document.

Capital Acquisitions Tax

No.

Real Property Tax

All real property in Egypt is subject to the real estate tax. The tax rate is 10% on the annual rental value after allowing a 30% deduction from the rental value to cover related costs for residential property and a 32% deduction for non-residential property. A residential unit with an annual rental value less than £E6,000 is exempt. The property owner pays the real property tax, which is due in two instalments, one in January and one in July. The annual rental value of real estate is assessed every five years by the tax authorities.

Inheritance/Estate Tax

No.

Net Wealth/Net Worth Tax

No.

Social Security

The social security regime applies to local nationals.

Administration & Compliance

Tax Year

Calendar year.

Filing & Payment

Individuals must submit a declaration of income before 1 April following the end of the tax year and must pay tax based on the declaration. Employment income is taxed by withholding at source.

Tax Penalties

A penalty of £E10,000 applies in cases of tax evasion.

 

 
 

 



 


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