United States-Egypt Tax Treaty

Egypt International Tax Compliance Rules

US – Egypt Tax Treaty Quick Summary.  Situated in North Africa, Egypt is a transcontinental country bordering the Mediterranean Sea, the Gaza Strip, Israel, and the Red Sea, as well as Sudan and Libya.  Egypt is home to iconic historical monuments such as the pyramids, and ruins of Memphis and the Valley of the Kings.  Egypt obtained sovereignty in 1952.

The Egyptian constitution provides for a democratic republic with a legislature consisting of a House of Representatives (Magles en Nowwáb) and Consultative Council (Maglis El-Shura). Egypt is comprised of 27 governorates.

U.S.-Egypt Tax Treaty

Egypt is a member of the United Nations (UN), the Arab League, the African Union, and the Organization of Islamic Cooperation.

Egypt Tax Treaty.

• Convention between the Government of the United States of America and the Government of the Arab Republic of Egypt for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income signed at Cairo on August 24, 1980.
• Technical Explanation of the Convention between the United States and Egypt, signed on August 24, 1980

Currency.  Egyptian Pound (EGP.

Common Legal Entities.  Joint stock company, limited liability company, partnership limited by shares, limited and unlimited partnership, branch and representative office of a foreign company, and the single owner limited liability company.

Tax Authorities. Egyptian Tax Authority (ETA).

Tax Treaties.  South Africa is party to more than 57 tax treaties.  It is a signatory to the OECD’s MLI.

Corporate Income Tax Rate.  22.5%

Individual Tax Rate. 22.5%

Corporate Capital Gains Tax Rate.  10% / 22.5%.

Individual Capital Gains Tax Rate.  10% / progressive rates up to 22.5%.

Residence.  Individuals are resident if they are present in Egypt for more than 183 days in a fiscal year; are deemed to have a permanent abode in Egypt; or are Egyptian nationals performing their work duties abroad but being paid for these duties from an Egyptian source.

Withholding Tax.

            Dividends.  5%/ 10% (resident and nonresident company or individual).

            Interest.  0% / 20% (resident and nonresident company or individual).

            Royalties.  3% (resident company or individual) / 20% (nonresident company or individual).

Transfer Pricing.  Follow arm’s tenth principles.

CFC Rules.  Income from investments in nonresident companies is recognized under the equity method of revenue recognition

Hybrid Treatment.  No.

Inheritance/Estate Tax.  No.

Solidarity Contribution.  Government agencies, partnerships and companies are required to pay a solidarity contribution (to fund the state health insurance scheme) of 0.25% of annual revenue to the tax authorities when filing the corporate income tax return.  The contribution is not considered a deductible cost when calculating taxable profits for corporate income tax purposes.

Tax Treaty Network – International Tax Attorneys

Our international tax expertise allows us to guide clients through tax planning and compliance so that they can focus on what matters most. At Freeman Law, our clients are engaged in an interconnected business environment that spans across the globe.  From supply chains to markets, cross-country taxation impacts every global business.

Do you have questions about Egypt’s Tax Treaties? Schedule a consultation with one of Freeman Laws International Tax Experts Today!