For every employee on an Egyptian payroll, the employer pays social insurance of 18.75% over and above the wage, and deducts a further 11% from the employee. That is the short answer to what social insurance in Egypt costs an employer in 2026. Both percentages apply to the insurable wage, which runs from EGP 2,700 to EGP 16,700 a month this year. In Sharm El Sheikh and the rest of South Sinai, Universal Health Insurance (UHI) is live, so the employer adds another 4% and the employee 1%.
This guide works through one hotel employee in Sharm, line by line: what the hotel pays, what the employee receives before salary tax, how salary tax is worked out, and what the hotel files during the year. All figures are as of October 2026. The wages used are illustrations, not market rates and not a statutory minimum.
Social insurance in Egypt: what the employer pays in 2026
Two contributions sit on every payroll in South Sinai, and each has an employer share and an employee share.
| Contribution (as of October 2026) | Employer pays | Employee pays | Calculated on |
|---|---|---|---|
| Social insurance | 18.75% | 11% | Insurable wage, EGP 2,700 to 16,700 a month |
| Universal Health Insurance (live in South Sinai) | 4% | 1% | The wage (see the note on the base below) |
Two further items belong to the business rather than to each employee. UHI also carries a solidarity contribution of 0.25% of revenue, which is now deductible. A Martyrs' Fund contribution of 0.05% also appears on Egyptian payrolls; at that rate it barely moves the figures, so the examples below leave it out.
The insurable wage is the figure social insurance is calculated on. For 2026 it has a floor of EGP 2,700 and a ceiling of EGP 16,700 a month. Which elements of a pay package count toward it is a question for each contract, so in the examples here we assume the whole monthly wage counts. For UHI we apply the 4% and 1% to the same monthly wage. That keeps the arithmetic readable; the exact base for each contribution is one of the first things we confirm when we set up a payroll.
How the 2026 floor and cap change the employer's share
The floor and the ceiling matter more than they look. Here is the social insurance on four monthly wages:
| Monthly wage (EGP) | Insurable wage (EGP) | Employer, 18.75% (EGP) | Employee, 11% (EGP) | Employer share as % of wage |
|---|---|---|---|---|
| 2,700 (the floor) | 2,700 | 506.25 | 297.00 | 18.75% |
| 10,000 | 10,000 | 1,875.00 | 1,100.00 | 18.75% |
| 16,700 (the cap) | 16,700 | 3,131.25 | 1,837.00 | 18.75% |
| 25,000 | 16,700 | 3,131.25 | 1,837.00 | about 12.5% |
Up to EGP 16,700, the employer's share grows in step with the wage. Above it, the share stops. A front-office manager on EGP 25,000 costs the hotel the same EGP 3,131.25 a month in social insurance as a colleague on EGP 16,700, which is about 12.5% of the higher wage. The floor works the other way: social insurance is calculated on at least EGP 2,700 a month.
For budgeting, this means a flat "plus 18.75%" overstates the cost of senior staff. Budget the employer's contributions per head, not as one percentage of the total wage bill.
Worked example: what a hotel employee in Sharm El Sheikh costs each month
Take a hotel employee in Sharm El Sheikh on a gross wage of EGP 10,000 a month. The assumptions: the whole wage counts as insurable wage, this is the employee's only job, and UHI is applied to the same EGP 10,000.
What the hotel pays
| Item | Rate | Per month (EGP) | Per year (EGP) |
|---|---|---|---|
| Gross wage | 10,000 | 120,000 | |
| Social insurance, employer share | 18.75% | 1,875 | 22,500 |
| Universal Health Insurance, employer share | 4% | 400 | 4,800 |
| Total cost to the hotel | 122.75% of the wage | 12,275 | 147,300 |
What the employee receives
| Item | Rate | Per month (EGP) |
|---|---|---|
| Gross wage | 10,000 | |
| Social insurance, employee share | 11% | −1,100 |
| Universal Health Insurance, employee share | 1% | −100 |
| Pay before salary tax | 8,800 | |
| Salary tax withheld | The brackets below | Depends on the taxable salary |
The gap between what the hotel spends (EGP 12,275) and what reaches the employee before salary tax (EGP 8,800) is EGP 3,475 a month, all of it social and health insurance. The employer's own part of that is EGP 2,275 a month, or EGP 27,300 a year, for each employee at this wage.
Multiply that by a full roster, add the seasonal staff who join for the high months, and payroll becomes a monthly piece of work in its own right. Running it for every employee, every month, is what our payroll, salary tax and social insurance service does.
How salary tax is calculated for a hotel employee in 2026
Salary tax is the employee's tax, not a cost to the hotel. The employer calculates it, withholds it from each payment and pays it over, so getting it right is still part of running payroll.
The annual brackets under Law 7/2024, as of October 2026:
| Annual taxable salary (EGP) | Rate |
|---|---|
| Up to 40,000 | 0% |
| 40,000 to 55,000 | 10% |
| 55,000 to 70,000 | 15% |
| 70,000 to 200,000 | 20% |
| 200,000 to 400,000 | 22.5% |
| 400,000 to 1,200,000 | 25% |
| Above 1,200,000 | 27.5% |
Two rules sit beside the table. Employees get an exemption of EGP 20,000 a year (on salaries from 1 March 2024), which comes off before the brackets apply. And the lower bands are withdrawn once net income goes above EGP 600,000, which matters for senior managers' packages.
Suppose a hotel supervisor's taxable salary for 2026, after the EGP 20,000 exemption and any other deductions the law allows, comes to EGP 90,000.
| Slice of taxable salary (EGP) | Rate | Tax (EGP) |
|---|---|---|
| First 40,000 | 0% | 0 |
| Next 15,000 (to 55,000) | 10% | 1,500 |
| Next 15,000 (to 70,000) | 15% | 2,250 |
| Next 20,000 (to 90,000) | 20% | 4,000 |
| Total for the year | 7,750 |
That is about EGP 646 a month withheld from the supervisor's pay. We start the example from the taxable salary on purpose. What goes into it for a given employee (which allowances count, which deductions apply) differs from one contract to the next, and it is the part we check first when we take over a payroll.
If an employee also works for a second employer, the secondary employer withholds 10% on account, and the main employer recomputes the tax at the progressive rates. The brackets, the exemption and the EGP 600,000 rule are set out in more detail in our guide to Egypt's income tax brackets for 2026.
What does an employer file for payroll during the year?
| When | What the employer does |
|---|---|
| Every pay run | Withholds salary tax; deducts the employee's 11% social insurance and 1% UHI; records the employer's 18.75% and 4% |
| January, April, July, October | Files the quarterly payroll return (Form 4) |
| January | Files the annual payroll settlement |
| Businesses in the simplified regime (Law 6/2025) | Annual payroll settlement only |
The simplified regime lightens the filing, not the contributions. Its exemptions cover items such as stamp tax, the development fee and dividend tax; social insurance and health insurance are not on the list. A small supplier or café that pays tax on turnover still pays 18.75% and 4% on its staff. How the regime works is in our guide to the simplified tax regime in numbers.
Contracts are worth a look too. Labour Law 14/2025 has governed employment since 1 September 2025, replacing Law 12/2003, so contracts and internal rules still written under the old law should be brought up to date.
What else adds to the cost of hotel staff in Egypt?
Social and health insurance are the fixed percentages. Other items depend on the business and on the employee.
- Profit share. Under Law 159/1981, when a company distributes profits, employees receive at least 10% of the distributed amount, capped at the employees' annual wages. Budget it in any year you plan a distribution.
- Work permits for foreign staff. Labour Law 14/2025 (Art. 71) leaves permit fees to ministerial decision. Foreigners who are exempt from a permit must still be notified within 7 days of starting work and of ending it.
- Tourism approval. Hotels need the Ministry of Tourism's own approval for foreign staff, in addition to the labour permit.
- Foreign-staff ratios. Investment Law 72/2017 (Art. 8) lets projects employ foreigners up to 10% of the workforce, or 20% where qualified Egyptians are not available.
- Repatriation. Under Art. 74 of Labour Law 14/2025, sending a foreign employee home is at the employer's cost unless agreed otherwise.
We check the social insurance position of each foreign employee separately, before the first payslip. The permit route itself is covered on our work permits page, and the licences and staffing approvals a hotel needs are on our hotels page.
Payroll in a hotel is a monthly routine with a few fixed percentages and many contract-level details. Get the base right once, per employee, and the rest follows. If you would rather go through your staff list in person, our office in Sharm El Sheikh is in Al Azizia Mall.
