Egypt Property Disposal Tax, Selling Costs and Foreign Repatriation Rules

Real Estate Disposal Tax and Capital Gains Rules

Under Egyptian tax law, disposals of property by individual sellers are not subject to standard corporate or progressive personal capital gains tax. Instead, transfers of built real estate or land designated for construction in Cairo fall under the Real Estate Disposal Tax regime pursuant to Law No. 91 of 2005 (Income Tax Law), as amended by Law No. 151 of 2026.

The tax rate is set at a flat 2.5% of the gross contract sale price or the official valuation established by the Egyptian Tax Authority (ETA), whichever is higher. There is no holding-period relief or tapered discount based on how long the asset has been held; the 2.5% rate applies identically to a sale completed after six months or twenty years. The seller is legally mandated to settle this tax within 30 to 60 days of executing the sale agreement. Payments must be remitted electronically directly to the ETA. Late payments incur an interest penalty calculated according to rates published by the Central Bank of Egypt (CBE).

Specific statutory exemptions apply. Disposals arising from compulsory sales, expropriation for public utility, transfers between direct linear relatives (spouses, parents, children) and property donated to state entities or public bodies are exempt from the 2.5% levy. Properties located in rural villages also fall outside the scope of this tax.

Non-Resident Seller Status and Withholding

Non-resident property owners are subject to the same 2.5% Real Estate Disposal Tax rate as Egyptian citizens and resident individuals. Non-resident status does not trigger higher transactional tax brackets.

Egypt does not enforce an automatic buyer-side tax withholding regime for standard real estate transactions executed between private individuals. The legal burden to calculate, report and pay the 2.5% tax remains with the seller. However, if the seller fails to remit the tax, the buyer will face administrative freezes when registering ownership documents. Under Egyptian law, the Real Estate Registration and Notarisation Authority (known locally as the *Shahr El-Aqari*) and utility providers are legally prohibited from transferring property title or connecting services until a clearance receipt from the ETA confirms full settlement of the disposal tax.

Where the seller is a foreign legal entity (a company selling corporate real estate), profits on disposal are classified as corporate capital gains subject to the standard 22.5% Corporate Income Tax rate on net gains, rather than the flat 2.5% gross disposal tax.

Agency and Legal Fees on the Sell Side

Brokerage fees in the Cairo market are typically negotiated between 1.5% and 2.5% of the total purchase price. Value-Added Tax (VAT) of 14% applies to commercial brokerage services rendered by registered real estate agencies in Egypt.

Legal fees for representation on the sell side generally cost between 1% and 2% of the total property value, or are charged as a fixed fee for standard residential sales. The seller's lawyer is responsible for checking the title deed history at the *Shahr El-Aqari*, drafting the definitive Sale Agreement (*Ekteda’a*), filing the disposal tax declaration with the ETA, and representing the seller at the Notary Public Office during final signature execution.

Additional minor seller outlays include municipal certificate costs, clearance letters from the developer or homeowners' association (HOA) confirming zero outstanding maintenance debts, and notary authentication fees. Sellers of primary market or master-developer units (such as those in New Cairo or 6th of October City) are often required to pay a developer transfer fee, which ranges from 1% to 10% of the original unit price depending on the developer's contractual terms.

Repatriation of Proceeds for Foreign Sellers

Repatriating the proceeds of a Cairo property sale abroad is governed by Central Bank of Egypt (CBE) regulations under Banking Law No. 194 of 2020 and Investment Law No. 72 of 2017. Foreign sellers have the legal right to convert Egyptian Pounds (EGP) into foreign currency and transfer funds abroad, provided strict compliance standards are met at closing.

Under regulations implemented by the Real Estate Registration and Notarisation Authority and the CBE, foreign buyers purchasing property in Egypt must transfer funds from abroad in convertible foreign currency into an accredited Egyptian commercial bank account. For a foreign owner subsequently selling property, establishing that the original purchase funds entered Egypt via official bank transfers (supported by Form 4 / Bank Import Certificates) is essential for clearing outward foreign exchange transfers with local banking compliance departments.

To process the repatriation transfer, Egyptian commercial banks require: 1. Proof of tax clearance issued by the Egyptian Tax Authority showing full settlement of the 2.5% disposal tax. 2. The notarised, registered final sale contract from the *Shahr El-Aqari*. 3. Proof of origin of initial investment funds (swift advice of the original inward transfer).

Provided all tax clearance documents and banking certificates match, commercial banks execute the outward foreign currency transfer. If funds cannot be validated through initial inbound banking records, conversion delays occur due to local foreign currency liquidity constraints.

Regulatory Framework

Real estate transactions in Egypt operate under the supervision of the Ministry of Finance and the Ministry of Justice. Compliance with the Real Estate Disposal Tax, title verification at the Real Estate Registration and Notarisation Authority (*Shahr El-Aqari*), and foreign exchange adherence with CBE-licensed commercial banks are mandatory requirements for securing a legal property sale.