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UK Egypt Dual Tax treaty

mosdiq

Is anyone using the dual tax treaty arrangements between UK and Egypt in relation to  tax on  pension payments from a UK Defined Benefits  Pension Scheme ?

See also

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Aelashkar

That's a very complicated one, while to help you, you mean taxes on money received in Egypt from the plan or your payment to the plan from Egypt?

mosdiq

There are two separate matters

I may be employed by an Egyptian consultancy registered in Egypt to do some work.There will be  tax implications for any income for work done in Egypt.

Separately I will be receiving a pension that I contributed to for 30 years when I worked for  a British company of 30 years. Rather than the pension being taxed in the UK I was enquiring if this pension being paid from a British fund instead of being taxed in the UK can it be subject to Egyptian tax legislation as I am residing in Egypt. It is because my understanding is that pension income is not subject to any tax in Egypt.

Kindly confirm/ advise ?

Aelashkar

Dear Sir,

Will advise now only on the first matter and will check for you on the second late today ins!

Firstly, if you are engaging here with the Egyptian company as a consultant and your work done here in Egypt for more than six (6) months, according to the Egyptian tax law you have made a "Premenant Establishment" that should be taxed for corporate tax at a nominal rate of 22.5%. additionally, your consulting my be subject to VAT (newly passed on September 7th) at a nominal rate of 13%. It's recommended to check this advise with the company's CFO/CPA.

Finally, any taxes paid here in Egypt according to the treaty will be as tax credit in U.K. 

Disclaim: please this is a general commentary and should be adjusted if needed by any needed details.

Best of luck.

Aelashkar

Adding to first point that, VAT would be imposed by you in your invoice to the consulting firm at 10% (in case you are a professional e.g. CPA, doctor, lawyer, etc) 13% is the general tax price for the VAT. if you would be an employee, your employer would deduct a range of 10, 15, 20, 22.5% according to your tax bracket and remit this to the tax authority.

The permanent establishment Period according to the treaty is even lesser (120) days.

Second question: your pension instalments received from U.K. In Egypt would likely not subject to tax as its against services not introduced in Egypt, so it's tax free.

Hope that would help.  if you are now in Egypt u can call me if you wanna to elaborate more.

Ali Kittermaster

@Aelashkar hoping you get this. Trying to establish if cashing in my pension while I am a resident of Egypt is the right thing to do. I have been told Egypt do not see pension income as taxable. Thank you

Ali Kittermaster

@mosdiq did you ever get a response on this. Wanting to cash a provate pension but don't want to be taxed