← Guides / Egypt

Egypt Cross-Border Tax Guide — الضرائب العابرة للحدود

the Egypt cross-border tax rules for 2026. The guide covers: the tax residency test — the physical presence of 183 or more days in Egypt triggers the unlimited tax liability on the worldwide income; the non-resident taxation — the non-residents are taxed only on the Egyptian-source income; the treaty network — the Egypt has concluded DTAs with 60+ countries including the most OECD members; the foreign tax credit — the unilateral relief is available under the Egyptian domestic law in addition to the treaty relief; and the special regimes — the free zones, the Special Economic Zones (SEZs), and the Golden License regime.

Tax Residency — الإقامة الضريبية

  • 183-day physical presence test: The individual who is physically present in Egypt for 183 days or more in a taxable year (the calendar year from January 1 to December 31) is classified as an Egyptian tax resident. The days of arrival and departure each count as a full day. The presence includes any day spent in Egypt, regardless of the purpose (business, tourism, or family visit).
  • Worldwide income for residents: The Egyptian tax resident is subject to tax on their worldwide income (the "دخل عالمي" — the "global income") at the progressive rates of 0% to 25% (the personal income tax) or at the flat corporate rate of 22.5% for the business income. The foreign-source income is included in the taxable base, with the credit for the foreign taxes paid.
  • Source-only for non-residents: The non-resident individual or company is taxed only on the Egyptian-source income (the "دخل مصري المصدر" — the "Egypt-source income"). The Egyptian-source income includes: the employment income for work performed in Egypt, the business profits from a permanent establishment in Egypt, the Egyptian-sourced dividends, interest, royalties, and the capital gains on the Egyptian assets.
  • Corporate residency: A company is considered a tax resident in Egypt if: (a) it is incorporated under the Egyptian Companies Law, or (b) its "مركز الإدارة الفعلي" (the "place of effective management") is in Egypt. The resident companies are taxed on the worldwide income at the 22.5% corporate rate.

Double Tax Treaty Network — شبكة اتفاقيات منع الازدواج الضريبي

  • Treaty network — 60+ countries: Egypt has concluded the double tax treaties (DTAs — "اتفاقيات منع الازدواج الضريبي") with over 60 countries, including the most OECD members. The key treaty partners include: the United Kingdom, Germany, France, Italy, the Netherlands, Switzerland, China, India, Japan, South Korea, the UAE, Saudi Arabia, Kuwait, and Qatar.
  • Treaty with the USA: Egypt has a DTA with the United States (the 1981 Treaty, as amended). The key provisions: the dividends WHT at 5-15%, the interest WHT at 15-20%, the royalties WHT at 15-25%, and the permanent establishment threshold of 183 days (services) or 6 months (construction). The US-Egypt Treaty is generally favourable but the rates are higher than the OECD average.
  • OECD alignment: The majority of Egypt's DTAs follow the OECD Model Tax Convention. The standard provisions include: the business profits Article 7 (the PE threshold), the associated enterprises Article 9 (the transfer pricing), the dividends Article 10, the interest Article 11, the royalties Article 12, the capital gains Article 13, and the mutual agreement procedure Article 25.
  • Treaty relief procedure: To claim the treaty benefits, the taxpayer must obtain the "شهادة الإقامة الضريبية" (the "certificate of tax residence — CoR") from the residence country. The withholding agent in Egypt applies the treaty rate upon receiving the valid CoR. The excess tax withheld must be refunded through the Egypt Tax Authority refund procedure.

Foreign Tax Credit — الائتمان الضريبي الأجنبي

  • Unilateral foreign tax credit: Under the Egyptian Income Tax Law 91/2005, the residents are entitled to a unilateral foreign tax credit (the "ائتمان ضريبي منفرد" — the "unilateral tax credit") for the foreign taxes paid on the foreign-source income included in the Egyptian taxable base. The credit is limited to the lower of: (a) the actual foreign tax paid, or (b) the Egyptian tax attributable to the foreign-source income.
  • Treaty foreign tax credit: The DTAs typically provide for the "طريقة الائتمان" (the "credit method") for the elimination of the double taxation. The resident is entitled to the credit for the foreign tax paid in the source country, up to the Egyptian tax payable on that income. The credit is calculated separately for each source country (the "per-country limitation").
  • Exemption method: Some DTAs provide for the "طريقة الإعفاء" (the "exemption method") for certain types of income — the foreign-source income is exempt from the Egyptian tax in the residence country. The exemption typically applies to the government service income and the certain employment income.
  • Foreign tax credit claim procedure: To claim the foreign tax credit, the taxpayer must: (a) submit the "إقرار ضريبي" (the "tax return") including the foreign-source income, (b) attach the evidence of the foreign tax paid (the foreign tax assessment or the tax receipt), (c) provide the translated and certified documents. The unused foreign tax credit may be carried forward for up to 3 years.

Special Regimes — الأنظمة الخاصة

  • Free Zone companies — المناطق الحرة: The companies operating in the "المناطق الحرة العامة" (the "public free zones") enjoy: (a) the exemption from the corporate income tax for the profits generated within the free zone, (b) the exemption from the VAT and customs duties on the imported goods used in the free zone operations, (c) the annual fee of 1-2% of the value of the goods entering the free zone (in lieu of the tax). The free zone companies are restricted from selling into the Egyptian domestic market (with limited exceptions).
  • Special Economic Zones (SEZs) — المناطق الاقتصادية الخاصة: The SEZs (including the "Suez Canal Economic Zone — SCZone" and the "Golden Triangle" zone) offer a reduced corporate tax rate of 10% for the first 5 years (extendable). Additional benefits include: the simplified customs procedures, the expedited licensing, and the reduced social insurance obligations for the foreign workers.
  • Golden License — الرخصة الذهبية: The "Golden License" regime (introduced under the Investment Law 72/2017) provides the strategic projects with: (a) the streamlined one-stop-shop approval process, (b) the exemption from certain licensing requirements, (c) the potential tax and customs incentives negotiated on a case-by-case basis, (d) the allocation of the government-owned land at preferential rates. The Golden License is available to the projects valued at over EGP 1 billion in certain priority sectors.
  • Transfer pricing: The Egypt transfer pricing rules (under the Ministerial Decree 115/2021) follow the OECD Transfer Pricing Guidelines. The related-party transactions must be documented at arm's length. The TP documentation requirements apply to the transactions exceeding the thresholds: the full TP file for the groups with the annual turnover exceeding EGP 100 million and the intra-group transactions exceeding EGP 5 million.