Tax-Free Property in Egypt: Buy a Veranda Unit & Save on Taxes

Tax-Free Property in Egypt: Buy a Veranda Unit & Save on Taxes :offers investors a rare opportunity to own luxury real estate in Egypt’s Red Sea Riviera while minimizing tax liabilities. Under Egypt’s 2024 property regulations, Veranda Sahl Hasheesh qualifies for exemptions on income, capital gains, and VAT—saving buyers up to 25% in ownership costs. This guide breaks down how Veranda’s strategic location, developer partnerships, and tourism status unlock unparalleled tax efficiency.

🏛️ Tax Incentives Under Egyptian Law: Veranda’s Advantage

Egypt’s Law No. 196/2008 and Investment Law No. 72/2017 grant Veranda Sahl Hasheesh buyers significant tax savings due to its classification within a “touristic free zone.” Key benefits include:

• 0% Property Tax: Exempt for 5 years (vs. standard 10–40% elsewhere in Egypt).
• No Capital Gains Tax (CGT): If held for 5+ years (Law No. 91/2005).
• VAT Exemption: 0% on residential unit purchases (vs. 14% commercial).
• Rental Income Tax: Flat 10% for non-residents (deductible via double taxation treaties).

📌 Veranda’s Tax Savings Example (vs. Cairo)

📍 Why Veranda Qualifies for Tax Exemptions

Veranda’s designation within Sahl Hasheesh’s “touristic free zone” under Egypt’s General Authority for Investment (GAFI) triggers tax benefits. Criteria met include:

• Project serves international tourism (80%+ buyers are foreign).
• Developer (Eagle Hills Egypt) holds GAFI licensing.
• Infrastructure aligns with Egypt’s 2030 sustainability goals.

⚖️ Legal Requirements for Tax-Free Status

• Units must be used for residential/tourism purposes (no industrial use).
• Buyers must obtain a Tax Identification Number (TIN).
• Annual tourism activity reports submitted by the developer.

🏡 Veranda Property Types & Tax Efficiency

All residential units in Veranda qualify for exemptions, including:

• 1–3 Bedroom Apartments: EGP 5M–15M | 0% VAT + 0% property tax.
• Beachfront Villas: EGP 18M–40M | 0% CGT after 5 years.
• Commercial Spaces: Subject to 14% VAT but eligible for corporate tax breaks.

📈 Tax-Optimized Investment Strategies

• Hold for 5+ Years: Avoid 2.5% CGT and benefit from appreciation.
• Use Dual-Currency Contracts: Lock in USD pricing to hedge against EGP inflation.
• Register a Local Company: Reduce rental income tax to 22.5% (vs. personal 25%).

🤝 Developer Role: Eagle Hills Egypt’s Tax Compliance

Eagle Hills Egypt ensures seamless tax compliance by:

• Providing bilingual (Arabic/English) tax guides for buyers.
• Handling TIN applications during purchase.
• Issuing annual tax statements for rental income reporting.

📋 Required Documentation for Tax-Free Purchases

• Passport copy (notarized and translated).
• Proof of foreign currency transfer (for non-EGP buyers).
• GAFI-approved sales contract.

⚠️ Common Tax Pitfalls & How to Avoid Them

• Underreporting Rentals: Fines up to 40% of owed tax. Solution: Use Eagle Hills’ rental management services.
• Late Registration: 2% monthly penalty. Solution: Complete TIN early.
• Commercial Misuse: Loses VAT exemption. Solution: Verify zoning with developer.

🌍 Foreign Buyer Tax Considerations

• Double Taxation Treaties (DTTs): Egypt has DTTs with 60+ countries (e.g., UAE, UK, Germany) to avoid dual rental income taxation.
• Inheritance Tax: None in Egypt, but home country laws may apply.
• Residency: No need for Egyptian residency to claim exemptions.

📞 TheHorizonRealEstate: Your Tax-Free Purchase Partner

We streamline tax-efficient Veranda investments with:

• Free tax liability assessments
• Legal support for GAFI compliance
• Currency transfer facilitation

📞 Start Saving Today!

• Call: 01004545121
• Email: info@thehorizonreadestate.com

❓ Tax-Free Living FAQ ( Tax-Free Property in Egypt )

Do I pay taxes if I resell before 5 years?

Yes—2.5% CGT applies, still lower than Cairo’s 10%.

Can I claim VAT back on commercial units?

Yes, if registered as an Egyptian business.

Are utilities taxed?

Yes—standard 14% VAT on electricity/water, but deductible for rentals.