Lebanon

Employment expenses

Reimbursements for expenses and representation allowances below 10% of the basic salaries of managerial staff may be deducted from taxable income.

The following expenses may also be deducted from taxable income:

• Payments to pension schemes.
• Scholarships or payments granted by an employer on the birth of a child, on marriage, or death, provided they are granted to all employees and have been approved by the Ministry of Labour.
• End-of-service indemnities paid in accordance with the relevant laws and regulations.
• Transportation allowances of LL 250,000 per day increased to LL 450,000 per day effective 15 February 2024 for the private sector (as per Decree no. 12966 dated 15 February 2024).
• Annual schooling allowance of a maximum total amount of LL 6 million and for a maximum of three children.

University tuition that teachers are exempt from on behalf of their children are not subject to tax within certain limits, with no need to obtain approval from the Ministry of Labor.

Article 47 of Budget Law 2019, which amended Article 47 of the Income Tax Law, defined the exempt benefits from payroll tax. Below are the amended exemptions:

• Pensions given to the military martyr’s heirs or the wounded as per Article 85 of the National Defense Law.
• Payroll benefits granted to midwives working at hospitals.

Article 38 of Budget Law 2022 provided exemption from payroll tax of salaries of the employees who have been permanently disabled as a result of the Beirut Port explosion are exempt from payroll tax.

Personal allowances

Individuals are entitled to family deductions ranging from LL 450 million to LL 900 million instead of LL 37.5 million to LL 62.5 million according to the taxpayer's family status (as per Article 49 of Budget Law 2024 dated 15 February 2024).

Business deductions

For sole proprietorships and general partnerships, tax is levied on real profits or profits on a fixed lump-sum basis (a specified percentage, depending on the type of profession, applied to annual revenues to determine taxable profits). Accordingly, no deductions are taken into consideration.

Limited partnerships are allowed the same deductions as those available to corporations. See the Deductions section in the Corporate tax summary for more information.