Mohamed Maait, Minister of Finance, has issued Resolution No. 491 for 2021 to amend some provisions of the executive regulations of the Income Tax Law promulgated by Law No. 91 of 2005.
Reda Abdel Qader, Chairperson of the Egyptian Tax Authority (ETA), said Monday that the first paragraph of Article 51 of the executive regulations will be replaced by the following text:
“In the application of the provisions of Article 42, the competent tax authority shall be notified of the taxpayer to pay the tax on the form (8 real estate), and the taxpayer is obligated to notify the competent tax office of the taxable real estate disposals through the electronic portal of the Egyptian Tax Authority or by any electronic means on the form (16 bis).”
Abdel Qader added that in order to facilitate procedures and to complement the electronic services provided by ETA, a 16-bis form (notification of the disposal of built real estate or land to be built on) has been made available electronically on both the electronic declaration system and the automated tax procedures system, and therefore the financier is obligated to submitting a form (16 bis) electronically from the date it was made available on the electronic system.
He pointed out that in accordance with Article 42 of the Income Tax Law, the real estate tax is imposed at a rate of (2.5%) of the value of the sold property, without any reduction in the total value of the disposal of built real estate or land to build on, as well as whether the contracts of these transactions are publicized or not.
He explained that all real estate and residential units in villages are exempted from the real estate tax, as well as the actions of the heir until the issuance of Law No. 158 of 2018 amending Law No. (91) of 2005, amending Article 42, in the real estate that devolved from bequeather in its condition upon inheritance, in addition to real estate presented as an in-kind share 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 endowment contracts between assets and branches, and also is not considered a taxable disposal of forced sales and expropriation for the public benefit or improvement.
He pointed out that the submission of evidence indicating the payment of real estate tax has been cancelled in the event of the real estate declaration or the provision of a service on the real estate being disposed of, by Law No. (5) of 2021.
He added that the property owner is obligated to pay the tax within 30 days from the date of the “real estate disposal” and it applies in return for the delay stipulated in the Income Tax Law as of the day following the end of the thirty days.
He added that in the case of the only act of a natural person with a tax file, the taxpayer is obliged to submit a form (16 bis) on the automated tax returns system, as well as pay the value of the real estate transaction tax on the system.
In the case of the only act of a natural person who does not have a tax file, Abdel Qader indicated that the financier is committed to several steps, which are to go to the competent tax office with a copy of the sale contract and the original contract for viewing, as well as a copy of the identity document, to open a tax file and obtain a tax registration number. Then, the taxpayer creates an account on the automated tax returns system under the tax registration number, to submit a form (16 bis) form on the automated tax returns system, as well as pay the value of the real estate transaction tax on the system.
Abdul Qader said that a form (16 bis inventory) is submitted electronically on the electronic declaration system www.incometax.gov.eg. and on the automated tax procedures system www.eta.gov.eg
He explained that the Integrated Communication Center receives all inquiries on hotline 16395 or via e-mail [email protected].