Egypt Property Tax Guide 2026

Overview — Property Taxation in Egypt

Egypt's property tax system includes recurring taxes (annual real estate tax, rental income tax) and transactional taxes (registration fees, stamp tax, capital gains tax). The absence of an annual wealth tax means holding property long-term does not attract a levy on the capital value. The main ongoing cost for property owners is the real estate tax (ضريبة العقارات المبنية) under Law No. 196/2008, which is based on the deemed annual rental value rather than the market value of the property.

Annual Real Estate Tax (ضريبة العقارات المبنية) — 2.5% of Rental Value

The annual real estate tax (also called the buildings tax) is levied at 2.5% of the annual rental value of the property. Key features:

• The tax is imposed on built properties (residential, commercial, industrial)
• The annual rental value is determined by a government committee based on location, size, and condition — not necessarily the actual rent received
• Residential properties with an annual rental value below EGP 24,000 are exempt
• The tax rate is 2.5% of the annual rental value after a 30% deduction for maintenance and expenses (effectively 1.75% of gross rental value)
• Owners of owner-occupied properties also pay the tax based on the deemed rental value
• The property owner is liable for the tax, which is payable annually through the local tax authority

For example, a property with a deemed annual rental value of EGP 100,000 is assessed at EGP 100,000 × 70% (after 30% deduction) × 2.5% = EGP 1,750 per year.

Rental Income Tax — 10% After 50% Deduction

Income from renting real estate is taxed separately from other income types under Egyptian tax law:

• Rate: 10% of net rental income (for residential and commercial properties)
• Deduction: A standard 50% deduction of gross rental income is allowed for all expenses (maintenance, management, insurance, depreciation) — no actual expense substantiation is required
• Effective rate: 10% × 50% = 5% of gross rental income
• The 10% rate is a final tax — rental income is not aggregated with other income for progressive IIT purposes
• Property owners receiving rental income must register with the tax authority and file annual rental income returns

For example, a property generating EGP 120,000 in annual rent: after the 50% deduction (EGP 60,000), the taxable base is EGP 60,000, and the tax at 10% is EGP 6,000 (5% effective rate on gross rent).

Property Registration Fees

When purchasing or transferring real estate in Egypt, registration fees apply at the Real Estate Registry (الشهر العقاري):

• Registration fee: Approximately 3% of the property value (varies slightly by governorate)
• Notary fees: Additional 0.5–1% for contract drafting and notarisation
• Stamp tax: 0.2–0.4% of the contract value on the sale deed
• Total transaction costs typically range from 3% to 5% of the purchase price

Property registration is strongly recommended as it perfects legal title and protects against competing claims. Unregistered properties (common in rural areas) may face legal challenges in disputes or inheritance proceedings.

Building Permit and Construction Fees

Construction and renovation of buildings require permits from the local municipality, with associated fees:

• Building permit fees vary by municipality and are based on the size and type of construction
• Typical fees include plan review fees, inspection fees, and occupancy permit fees
• Safety and environmental compliance fees may also apply for larger projects
• Illegal construction (without permits) can result in fines, demolition orders, and difficulties in property registration

No Annual Property Wealth Tax

Egypt does not impose an annual tax on the capital value or net worth of property holdings. The only recurring property tax is the real estate tax (2.5% of annual rental value), which is a tax on the use/benefit of the property rather than on its capital value. This makes Egypt attractive for long-term property investors who are not subject to annual holding costs based on property appreciation. There is no municipal tax or county tax on real estate beyond the real estate tax described above.

FAQs

Is the real estate tax the same across all of Egypt?

The rate is uniform at 2.5% nationally, but the annual rental value assessment varies by location. Properties in central Cairo or Alexandria will have higher deemed rental values than properties in rural areas.

Can I deduct mortgage interest against rental income?

No. The standard 50% deduction on gross rental income is a flat-rate deduction that covers all expenses. You cannot claim additional deductions for mortgage interest or actual maintenance costs. The 50% deduction is designed to simplify compliance.

Do foreign nationals pay different property taxes?

Foreign nationals are subject to the same property taxes as Egyptian nationals. However, foreign ownership of real estate in Egypt is restricted in certain areas (particularly near borders and military zones) and requires approval from the Ministry of Interior.

What happens if I do not pay the real estate tax?

Unpaid real estate tax accumulates as a debt against the property and may ultimately result in enforcement action, including seizure of the property by the tax authority. Penalties and interest accrue on overdue amounts.

Disclaimer

This guide provides general information about Egyptian property taxes for the 2026 tax year. Tax laws and rates may change. Always consult with a qualified Egyptian tax advisor or legal professional for advice specific to your property situation. InvestmentKit does not provide tax advice.