The real estate disposal tax is part of the income tax and is payable by the taxpayer if he disposes of real estate and is paid once when the real estate is disposed of.
The amendment submitted by the Egyptian government to Parliament on real estate disposal tax provides for the imposition of a lump-sum tax according to the value of the disposal, on contracts that were made before Law No. 11 of 2013 came into effect on May 19, 2013, so that the last seller pays it only, regardless of the number of ownership chain contracts. If the value of the contract is up to 250 thousand pounds (15.8 thousand dollars), the value of the tax will be 1500 pounds, and if the value of the contract is more than 250 thousand pounds up to 500 thousand pounds, the value of the tax will be 2000 pounds, while if the value of the contract is more than 500 thousand pounds Up to one million pounds, the value of the tax is 3,000 pounds, and if the value of the contract is more than one million pounds, the tax will be 4,000 pounds, without delay penalties.
Said Fouad, advisor to the head of the Egyptian Tax Authority, explained that the draft real estate tax law imposes a lump-sum tax according to the value of the disposal, on contracts that were made before Law No. property, without delay fines. However, he confirmed the continuation of the real estate disposal tax at a rate of 2.5% without a maximum value of the real estate transactions that took place during the law’s period of operation after May 19, 2013 without any change to it, whether this was in the real estate shown or land for construction.
According to the Ministry of Finance, the Egyptian Tax Authority follows up on the collection of real estate tax from the seller without referring to the buyer, unless the latter voluntarily applies to pay the tax, and the real estate tax is due within 30 days from the date of disposal.
Fouad added, in exclusive statements to CNN in Arabic, that the Egyptian Ministry of Finance does not have a limit on the number of units that the tax will be applied to, but it allows citizens who wish to reconcile the situation before the application of the income tax law on May 19, 2013, to pay the tax to facilitate real estate registration procedures, Noting that the law has been approved by the government and is awaiting its turn for discussion and approval by the House of Representatives, and once approved and approved, it will be implemented.
At the beginning of last March, President Abdel Fattah El-Sisi postponed the implementation of the amendment of the real estate registration law, for a transitional period of no less than two years, in order to provide the opportunity and time for a societal dialogue, and during that transitional period to collect a fixed, reduced and clear value when registering property. According to the area and type of ownership, instead of the tax imposed in this regard on real estate transactions.
The advisor to the head of the Egyptian Tax Authority identified the units that are exempt from paying the real estate tax, which are the residential units in villages that are exempt from the real estate tax, as well as the actions of the heir until July 25, 2018, in the real estate that passed to him from his bequeather in its condition upon inheritance, in addition to the property presented as a share in kind. In the capital of joint stock companies, provided that the corresponding shares are not disposed of for a period of five years, as well as all social housing units, noting that real estate investment and real estate development companies do not pay real estate transaction tax as they are subject to commercial profits tax.
Regarding the target outcome of amending the Income Tax Law, Saeed Fouad said that it is difficult to estimate an expected outcome from a draft law that has not yet been approved, but he pointed out that the proceeds of the real estate transaction tax amounted to more than 8 billion pounds (509.2 million dollars) during the fiscal year. Previous.
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