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Setting up and managing payroll in Egypt
Egypt’s economy is one of the strongest in Africa, and the country attracts a large amount of foreign investment.
If you are planning an expansion into Egypt, it is important to understand that the process of hiring and setting up payroll can be difficult for foreign organizations. Language barriers, complex regulations, and unexpected delays often stall progress and cut into revenues.
A popular way to bypass the complexity of Egyptian employment is to outsource your payroll setup and management. At Horizons, we will work with you to build and run a compliant, fully functional Egyptian payroll to help you kickstart your expansion, whether or not you already have a registered entity in the country.
Why choose the Horizons payroll solution?
If you have an entity
For businesses that have already registered an official entity in Egypt, we offer a comprehensive and tailored payroll outsourcing service. Our expert team will set up and manage your payroll, also handling all of your associated administration, HR, and compliance with local laws.
This level of outsourcing is ideally suited to larger organizations and those expanding into Egypt in the long-term.
If you don’t have an entity
If you have not registered a legal entity in Egypt, then our comprehensive outsourcing services can cover your payroll setup and management, making use of our established Egyptian subsidiary to act as employer of record.
This option is ideal for any organization aiming for a rapid, low-risk, and scalable route into Egyptian hiring and expansion.
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Egypt payroll guide
What are the tax and withholding rules in Egypt?
In Egypt, both employees and employers must contribute to social security, and the contributions vary depending on salary. For employers, the contribution is either 24% or 26% of salary, and for employees, it is either 11% or 14%.
Income tax in Egypt is progressive, and the rates are between 0% and 25%, depending on income level.
Corporate tax in Egypt is 22.5%.
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Social Security (capped at 1,670 EGP)
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26.00%
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Social Security variable (capped at 4,040 EGP)
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24.00%
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Unemployment
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1.00%
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Total Employment Cost
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27% |
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Social Security contribution on the fixed salary
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14.00%
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Social security contribution on variables
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11.00%
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Total Employee Cost
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14.00% |
Terminations and severance in Egypt
When terminating employees in Egypt, the case must be taken to the Ministry of Manpower and Migration, which has 15 days to make a decision. The decision can also be contested by the employee.
Employees are also entitled to a notice period prior to termination, which varies depending on their length of service. For those with under ten years of experience, there is a mandatory 60-day notice period. For those with more than ten years of service, the minimum is 90 days.
Probation periods in Egypt are limited to three months.
How to establish payroll in Egypt
To establish and run payroll yourself, your organization will need to follow a complex set of laws and procedures that are unique to Egypt, as well as operate and negotiate in the Egyptian language. You will usually have to register a legal entity, sign up with the relevant authorities, open bank accounts, and hire a workforce.
Alternatively, Horizons’ outsourcing can streamline your entire hiring and payroll process, facilitating your Egyptian expansion and ensuring you are fully prepared to grow your business successfully. Our employer or record service means that you can even benefit from our solutions if you have not registered a legal entity in Egypt, utilizing our Egyptian subsidiary to act as employer of record for your employees.
Manage payroll in Egypt
Whether it’s EOR service or just payroll management, Horizons’ employment experts can help you get started in 24h.
