What are the business tax submissions in Egypt and its deadlines?

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Any company in Egypt nowadays is under huge pressure of new and numerous tax regulations regardless the size of a company, especially that these new regulations have imposed a lot of heavy penalties on any disobeyed company.
Therefore, all companies must be aware of all deadlines of tax submissions to avoid being subject to any kind of penalties due to either delayed submissions or lack of information.

The first step would be registration (sign up) of the company at the electronic portal of the Egyptian Tax Authority, and there is a subscription fee for this portal of EGP 500 that shall be renewed and paid for annually.

As for the tax submissions of a company, they shall include the following:

  • Income tax return: which shall be submitted annually on April 30.
  • Payroll/earnings tax return: submitted every 3 months. Required documents include filled social insurance form No. 2 of the company, and the ID/passport copies of the partners and employees of the company.
  • Withholding tax return: submitted every 3 months.
  • Value-Added-Tax (VAT): The company will be required to register in the VAT only if:
  1. It starts with the importation activity under its name directly; or
  2. The total sales exceed the amount of EGP 500,000. The first EGP 500,000 will be tax exempted, and the tax assessment will start based on any amount exceeding this first EGP 500,000.
  • In all cases, once the company is registered in VAT, it shall collect 14% VAT on sales, and deduct 14% on inputs, then the difference between those amounts shall be paid.
  • The VAT tax returns are submitted monthly.

The company shall on a monthly basis provide two separate excel sheets; a) one for purchases detailing every item related to the company’s purchases during the previous month; and b) the other is for the sales to detail every item related to the company’s sales during the same month. Along with these excel sheets, the documents supporting these transactions will be required.

It is to be noted that all the tax returns are submitted through the Tax Authority’s electronic portal.

The records that the company shall currently authenticate are as follows (we shall purchase the records and authenticate them at the General Authority for Investment):

  • General daybook.
  • Inventory book.

About the author:

Mr. Al-Bedeawi is the founder of Al-Bedeawi and Partners LLP, and is a member of both the Egyptian Bar Association, as well as the International Bar Association in London. He has 13 years of experience in corporate law, international contracts, franchise, trademark registration, intellectual property rights, hotels management agreements and debt collection.

Before founding the law firm, Mr. Al-Bedeawi worked as a legal consultant for a number of high-ranking tourism and real estate investment companies in Egypt, including Misr-Italy Real Estate, and Sharm Dreams Group in which he was drafting, revising and negotiating its agreements including the management agreements for its five star Hilton and Marriott hotels. Additionally, Mr. Al-Bedeawi has made a 320 million EGP acquisition for a large ceramic factory in Ain Sokhna and he was representing the selling party and chosen to be as a mediator during the performance of the sale agreement made by Mr. Al-Bedeawi himself.

What Is the Registration Process of a Business at the Social Insurance Authority in Egypt

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Following our previous article regarding the required documents to open a Social Insurance file in Egypt for a company after its incorporation is completed, we must proceed with these following steps to finally have the file opened and ready to be used and start adding employees thereon;

a) First step of registration would be preparing the required documents as per our previous article, and as may be amended/required by the Social Insurance Authority pursuant to any new laws, regulations, or resolutions at the time of initiating the Social Insurance registration process. Also, the signature forms of the representative from the company who shall sign any Social Insurance form on behalf of the company shall be signed by this step.
This representative can be;

i) the signatory of the company as per the company’s commercial register,

ii) an authorized person by virtue of a delegation signed by the company’s manager, or

iii)an attorney by virtue of a POA signed by the manager.

b) Fill in the application of registration of the company at the Social Insurance Authority attaching thereto the Company’s documents as aforementioned, this is in addition to filling out the Social Insurance registration form(s) with the data (including the Social Insurance number) of the manager, or partner(s) of the company to submit with the application.

c) Afterwards, the application and the submitted documents are reviewed by the Social Insurance inspector who is assigned to the company’s file to make sure that all the documents and data are fulfilled before deciding a date for the inspection that will take place at the company’s headquarters.

 

d) Should the Social Insurance inspector not require any further documents or data to be provided by the company, the inspector shall consequently visit the company’s headquarters to undertake the inspection (to be noted that this inspection visit of the company’s headquarters normally takes place with no prior arrangements between the company and the Social Insurance inspector, and the company is not notified of the date thereof).

e) Following the inspection visit, the company’s file and documents are reviewed by the computerization department inside of the competent Social Insurance Office, so the reviewed and completed file is sent to the Main Office to which the competent SI Office is affiliated, for approval.

f) After the approval of the Main Office of the company’s Social Insurance file, it sends the file back to the competent Social Insurance Office to be reviewed for the last time by the computerization department in preparation for issuing the social insurance number of the company.

g) Keep following up until the registration on the system of the Social Insurance Authority is finalized, the Social Insurance Office shall then inform the company to pay any outstanding contribution/registration fees (if any), after which the company shall obtain its social insurance registration number marking the last step in the successful registration process of the company at the Social Insurance Authority and by which the company shall then be ready to register its employees in a whole new process and requirements.

Finally, you will need an experienced attorney to lead you and follow these steps to adequately register your company without any delay or overestimating your stuff number by the inspector. In order to avoid these practical problems you may need to communicate with out team to help you out on this issue.

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