Egypt payroll guide (2026): tax, social insurance and labour law

Income tax on salaries

Egypt taxes employment income through monthly withholding, calculated on an annualised basis under Income Tax Law 91 of 2005, as amended by Law 7 of 2024. Employee social insurance and the EGP 20,000 personal exemption are deducted first.

Annual taxable income (EGP)	Rate
0 – 40,000	0%
40,000 – 55,000	10%
55,000 – 70,000	15%
70,000 – 200,000	20%
200,000 – 400,000	22.5%
400,000 – 1,200,000	25%
Above 1,200,000	27.5%

Bracket elimination. Above EGP 600,000 of annual taxable income the lower bands fall away tier by tier. Between 600,000 and 700,000 the 0% band no longer applies; above 1.2 million, everything up to 1.2 million is taxed at 25%. A simple progressive calculation understates tax for senior staff. Our net salary calculator applies the tiers.

Under Social Insurance and Pensions Law 148 of 2019, contributions are calculated on the insurable wage: the total monthly wage, clamped between a minimum and a maximum that rise every 1 January.

	Employer	Employee
Total contribution	18.75%	11%
Insurable wage 2026	EGP 2,700 – 16,700 a month

Contributions apply to the minimum even if the actual wage is lower. Foreign employees are covered too, unless a totalisation agreement applies. Universal Health Insurance contributions apply only in governorates where the scheme has been rolled out, so check the work location.

Labour Law 14 of 2025

The new Labour Law took effect on 1 September 2025, replacing Law 12 of 2003. Some executive regulations were still being issued in late 2025, so review contracts and handbooks drafted under the old law. Key points:

Working time: 8 hours a day, 48 a week maximum. Five-day, 40-hour weeks are common by contract.
Overtime: reported as a 35% premium for daytime and 70% for night work. Rest-day work earns double pay plus a compensatory day off.
Annual leave: 15 days in the first year after six months’ service, 21 days from the second year, and 30 days after ten years’ service or from age 50.
Maternity leave: four months fully paid, up to three times during employment, with no minimum service.
Annual increment: at least 3% of the insurable wage each year.
Resignation must now be certified to be valid.

Minimum wage

The private-sector minimum wage is EGP 7,000 a month (National Wages Council, March 2025). The EGP 8,000 figure announced for July 2026 applies to the public sector. Recheck the National Wages Council before each budget cycle.

Gotchas for foreign employers

High earners hit tax “cliffs” at each tier boundary above EGP 600,000.
The insurable wage band moves every January, so payroll systems need an annual update.
EOR quotes that leave out foreign employees’ social insurance are wrong.
Unlawful termination costs at least two months’ wage per year of service, so budget for it.

Frequently asked questions

What is the personal tax exemption in Egypt?

EGP 20,000 a year, deducted before the brackets apply. The first EGP 40,000 of taxable income is also taxed at 0%.

Do foreigners pay social insurance in Egypt?

Yes. Since September 2021 foreign employees must be registered with NOSI unless a social security agreement with their home country applies.

Is there an end-of-service gratuity in Egypt?

Not for private-sector employees covered by social insurance; NOSI pays retirement benefits instead. Compensation applies on unlawful termination: at least two months' wage per year of service under Labour Law 14/2025.