Social insurance contributions and others, as retained according to the provisions of the Egyptian Social Insurance Law, or any alternative systems established according to the provisions of Law no. 64 of the year 1980 on alternative private social insurance systems are deductible.
Employees' contributions to the private insurance funds established according to the provisions of the law on private insurance funds, promulgated by Law no. 54 for the year 1975, are deductible (but may be limited, see Insurance expenses below).
Premiums of life and health insurance on the taxpayer, in one’s favour or in favour of one’s spouse or minor children, and any insurance premiums for pension entitlement, provided that the insurance policy is concluded with an insurance firm registered with the Egyptian Insurance Supervisory Authority, are deductible.
The total deductible amount for the employees' contribution to the private insurance funds, the premiums of life and health insurance, and the insurance premiums for pension entitlement cannot exceed 15% of the net revenue or EGP 10,000, whichever is lower. No further deduction of the same contributions and premiums should be repeated from any other industrial, commercial or non-commercial, or real estate income.
Every resident individual (employee) is allowed EGP 15,000 of the taxable amount earned per annum as a personal allowance starting from 1 July 2023 (previously EGP 9,000). There is also the first EGP 21,000 in the first tax bracket that is subject to 0% tax, which applies only to resident individuals with annual income that does not exceed EGP 600,000.
There are no family allowances in Egypt.
All expenses shall be deducted under the following conditions:
- They shall be connected with the commercial or industrial activity of the establishment and necessary for exercising that activity.
- They shall be true and supported documentarily (Taxpayers should support their expenses and costs with electronic invoices and electronic receipts to be considered deductible costs. with electronic invoices to be applicable starting July 2023, and electronic receipts starting January 2025.), with the exception of the costs and expenses that are not customarily established by documents.
Losses may be carried forward against future business profits for a period not exceeding five years unless:
- a change occurs in the ownership of the company’s capital, exceeding 50% of the shares, stocks, or voting rights
- the company changes its activity, and
- the company is either a Joint Stock Company or a Company Limited by Shares whose shares are not listed on the EGX.
Please note that for the payroll tax there are no losses.