Payroll Tax in Egypt: Calculating and Settling It Correctly

Payroll tax is withheld at source, and the responsibility for calculating and remitting it sits with the employer, not the employee. Errors are claimed back from the employer, with a delay charge attached.

How it is calculated

1. Total monthly income: salary, allowances, and cash or in-kind benefits.

2. Deduct the employee share of social insurance contributions.

3. Apply the annual personal exemption and the general exemption threshold.

4. Apply the progressive tax brackets to the resulting base.

5. Remit the tax due within the prescribed monthly deadlines.

Items people often miss

• In-kind benefits such as a company car or housing form part of the taxable base.

• Non-recurring bonuses and incentives are added in the month they accrue.

• Temporary and piece-rate workers follow different treatment and need a separate review.

Annual settlement

At year end you reconcile what was actually withheld against what was due, and file the settlement form with the tax office. Review payroll monthly so small differences never compound into one large year-end adjustment.