Search for the Egypt income tax rate and you will often see 22.5%. That is the corporate rate on company profit, and only one of the bands for individuals. As of October 2026, Law 7/2024 taxes an individual's annual net income in seven bands, from 0% on the first EGP 40,000 to 27.5% on income above EGP 1.2 million, and employees first deduct an exemption of EGP 20,000 a year from their salary.
This guide sets out the 2026 brackets, what they mean at four salary levels, the EGP 600,000 line above which the 0% band is lost, and the questions foreign employees and employers in Sharm El Sheikh ask us about. If you employ staff, our payroll and social insurance service applies these rules every month.
Egypt income tax rate 2026: the seven brackets
Personal income tax in Egypt is progressive. Each rate applies only to the slice of income that falls inside its band, never to the whole amount. These are the bands of Law 7/2024, unchanged as of October 2026:
| Annual net taxable income (EGP) | Rate on that slice | Total tax at the top of the band (EGP) |
|---|---|---|
| Up to 40,000 | 0% | 0 |
| Over 40,000 up to 55,000 | 10% | 1,500 |
| Over 55,000 up to 70,000 | 15% | 3,750 |
| Over 70,000 up to 200,000 | 20% | 29,750 |
| Over 200,000 up to 400,000 | 22.5% | 74,750 |
| Over 400,000 up to 1,200,000 | 25% | 124,750 at 600,000; above that line the lower bands are withdrawn |
| Over 1,200,000 | 27.5% | Lower bands withdrawn |
Read the table with three points in mind.
Net taxable income is not gross pay. For an employee, the brackets start after the EGP 20,000 exemption and any deductions the payslip is allowed. For a landlord, they start after the 50% deduction on rent.
The top rate is narrow. 27.5% applies only to the part of net income above EGP 1.2 million. Someone with EGP 1.3 million of net income pays 27.5% on the last EGP 100,000, not on the whole amount.
The 0% band has a ceiling. Above EGP 600,000 of annual net income, the 0% band is lost and the lower bands are withdrawn under the law's schedule. The section on the EGP 600,000 rule below explains what that does to your tax.
Companies are taxed separately. A company pays 22.5% corporate income tax on its profit (40.55% in oil and gas), and dividends paid to resident individuals carry a further 10%, or 5% for listed companies. A shareholder's dividend does not go through the personal brackets.
How does the EGP 20,000 salary exemption work?
Employees get an exemption of EGP 20,000 a year on their salary income. Law 7/2024 applied it to salaries from 1 March 2024, and it is unchanged as of October 2026. The exemption comes off the taxable salary first; the brackets apply to what remains.
Combined with the 0% band, it gives a simple threshold. An employee whose only income is a taxable salary of up to EGP 60,000 a year, or EGP 5,000 a month, pays no salary tax.
The exemption is set for salaries. Rent, a freelance professional's fees or a sole trader's profit go through the same brackets on their own rules, without it.
How much tax will I pay on my salary in Egypt? Four examples
The examples start from annual taxable salary: what is left after any deductions the law allows on the payslip, before the EGP 20,000 exemption. They assume one employer, no other income and the rates in force in October 2026.
| Taxable salary per month (EGP) | Per year | After the EGP 20,000 exemption | Salary tax per year | Per month | Share of the salary |
|---|---|---|---|---|---|
| 5,000 | 60,000 | 40,000 | 0 | 0 | 0% |
| 10,000 | 120,000 | 100,000 | 9,750 | 812.50 | 8.1% |
| 20,000 | 240,000 | 220,000 | 34,250 | about 2,854 | 14.3% |
| 40,000 | 480,000 | 460,000 | 89,750 | about 7,479 | 18.7% |
Take the EGP 20,000 a month line step by step. The annual taxable salary is EGP 240,000, and the exemption leaves EGP 220,000. The first EGP 40,000 is taxed at 0%. The next EGP 15,000 at 10% is EGP 1,500, and the following EGP 15,000 at 15% is EGP 2,250. The slice from EGP 70,000 to 200,000 at 20% is EGP 26,000, and the last EGP 20,000 at 22.5% is EGP 4,500. Total: EGP 34,250 a year.
The highest band reached is 22.5%, yet the tax is 14.3% of the salary: the band you reach and the share you pay are different numbers.
A real payslip will not match this table exactly. Bonuses paid in a single month, allowances, social and health insurance, a second employer and rent from a flat all change the figure, and the employer's deductions during the year are settled in the annual payroll settlement each January.
The EGP 600,000 rule: when the 0% band disappears
Law 7/2024 withdraws the lower bands once annual net income passes EGP 600,000. Above that line the 0% band is lost, so the first EGP 40,000 is no longer tax-free, and the lower bands are withdrawn under the law's schedule. Which bands still apply at a given income above the line is the detail we work through case by case.
What this means in practice:
- Up to EGP 600,000, the table above holds. At exactly EGP 600,000 of net income, the tax is EGP 124,750, about 20.8% of that income.
- Just above the line, a raise costs more than its own band rate. A bonus that lifts net income from just under to just over EGP 600,000 is taxed at 25% on the extra amount, and it also removes the 0% band, so the tax on income earned below the line rises as well.
- The test is annual. A large one-off bonus can take one year over the line while the years either side stay below it.
Do foreigners pay income tax in Egypt?
Nationality is not the test; tax residence and the source of the income are. As of October 2026, you are tax resident in Egypt if you have a permanent home here or spend more than 183 days in Egypt in a 12-month period (PwC). Residents are taxed on their Egyptian income, and on foreign income only if their centre of activity is in Egypt.
In practice, for a foreign employee in Sharm El Sheikh:
- A salary from an Egyptian employer goes through the brackets above, after the EGP 20,000 exemption, and the employer deducts the tax through payroll.
- Income earned abroad, such as remote work for a foreign client, is taxed in Egypt only if your centre of activity is here. Whether it is turns on your own facts, and we answer it in a personal review.
- Pensions and end-of-service bonuses are exempt from Egyptian income tax, according to PwC. How that applies to a pension paid from abroad is a question we answer case by case.
- Egypt has no inheritance, gift or net-wealth tax.
Egypt also has double tax treaties with Italy, Russia, the United Kingdom, Germany, Ukraine and Poland, among other countries, and a treaty can decide which country taxes a given income. Our page on tax for expats and retirees in Egypt covers residence, pensions and treaties in more depth, and our guide Is Egypt tax-free? What foreign residents actually pay looks at salary, pension, rent and remote income side by side.
How is a second job taxed in Egypt?
A chef employed by two restaurants, or a receptionist with a second contract at another hotel, has two salaries and one tax position. Under Law 30/2023 (Article 72 bis), the secondary employer withholds 10% on account, and the main employer recomputes the tax at the progressive rates.
The 10% is therefore a payment towards the tax, not the final rate. Once both salaries are counted, the brackets decide what you owe, and the result can be higher or lower than what the second employer withheld. Tell your main employer about the second salary, so the recomputation uses the right figures, and keep the payslips from both jobs.
What else comes off a payslip in South Sinai?
Salary tax is only one line. As of October 2026, an employee in South Sinai sees these deductions, and the employer pays its own share on top:
| Item | Employee | Employer | Basis (as of October 2026) |
|---|---|---|---|
| Salary tax | Brackets, after the EGP 20,000 exemption | Deducts it and files the returns | Law 7/2024 |
| Social insurance | 11% | 18.75% | Insurable wage between EGP 2,700 and EGP 16,700 a month in 2026 |
| Universal Health Insurance | 1% | 4% | Live in South Sinai |
For employers, the filing rhythm is set: quarterly payroll returns (Form 4) in January, April, July and October, and the annual payroll settlement in January. Businesses in the Law 6/2025 simplified regime file the annual payroll settlement only. Our guide to the real cost of an employee in Egypt works through the employer's side for a hotel employee in Sharm.
Which income goes through the brackets, and which does not?
Not every kind of income goes through the brackets. As of October 2026:
| Income | How it is taxed |
|---|---|
| Salary | Brackets, after the EGP 20,000 employee exemption; deducted by the employer |
| Rent from built property or furnished units | Actual rent minus 50%, then the brackets; built-property tax paid on the unit is credited against this tax |
| Fees of a freelance professional | Brackets on net income, or, with turnover up to EGP 20 million, the Law 6/2025 regime at 0.4% to 1.5% of turnover |
| Dividends from an Egyptian company | 10% (5% for listed companies), outside the brackets |
| Private sale of built property or building land | 2.5% real-estate disposal tax on the gross value, outside the brackets |
| Pensions and end-of-service bonuses | Exempt from Egyptian income tax (PwC); foreign pensions are a case-by-case question |
Individuals with rental, business or professional income file an annual return between 1 January and 31 March for the previous year. If that is you, our tax return service prepares and files it.
Who can check your salary tax or run your payroll in Sharm?
We calculate salary tax for employees and run monthly payroll for businesses in Sharm El Sheikh, Dahab and the rest of South Sinai: salary tax, social and health insurance, the quarterly Form 4 returns and the January settlement. For individuals, we check whether the 0% band still applies to you, how a bonus, a second job or rent changes the result, and whether you are tax resident in Egypt at all. Consultations are available in Arabic, English, Italian and Russian, and we reply the same day during office hours.
