Tax🇪🇬EgyptUpdated 2026-10-25

How does the simplified tax regime under Law 6 of 2025 work?

Quick Answer

Businesses with annual turnover up to EGP 20 million can pay income tax as a percentage of turnover, from 0.4% up to 1.5%, instead of on profit.

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Detailed Explanation

## Who can join

Companies and establishments with annual turnover up to EGP 20 million. The ETA says the regime is permanent and applies from the 2025 tax period.

## The tax

A fixed percentage of turnover: 0.4% for turnover under EGP 500,000, rising to 1.5% for turnover under EGP 20 million. The middle bands are in the law; Finn points you to the text rather than quoting them from memory.

## The benefits

  • No full tax audit for five years from joining
  • Exemption from stamp tax, State development fees, dividend tax and capital gains tax
  • VAT returns quarterly instead of monthly
  • Payroll returns annually

## The conditions

Apply on the ETA website; the regime runs from the application date. Use the ETA e-invoice and e-receipt systems, or you are removed. Keep books.

## How AccountsOS helps

Finn tracks turnover against the EGP 20 million ceiling and switches your VAT reminders to quarterly. AccountsOS does not issue e-invoices or e-receipts, so you need an ETA-integrated tool for those.

Source: https://eta.gov.eg/ar/news/alnzam-aldryby-almbst-wfqa-llqanwn-rqm-6-lsnt-2025-frst-daymt-ldm-almnshat-alsghyrt-wthqyq

Real-World Examples

Small shop

A shop with EGP 400,000 turnover pays 0.4%, EGP 1,600, if it has joined.

Growing agency

An agency nearing EGP 20 million asks Finn to watch the ceiling.

Common Mistakes to Avoid

  • Assuming membership without applying
  • Dropping e-receipts and losing the regime

Frequently Asked Questions

Is it temporary?

No. The ETA describes it as a permanent law.

Do I still keep books?

Yes.

Practical Tips

  • Keep the application confirmation
  • Use both e-invoice and e-receipt systems

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