Transfer Pricing Documentation in Egypt: The EGP 30 Million Threshold
Who needs a local or master file in Egypt? Anyone whose related-party dealings in the tax period exceed EGP 30 million, the limit since 18 December 2025. Disclosure is always due.
Executive summary
- Anyone whose total transactions with related persons in the tax period do not exceed EGP 30 million is exempt from the master file and the local file. The figure has applied since 18 December 2025 under Minister of Finance Decree 534 of 2025; it was EGP 15 million from 16 February 2024 and EGP 8 million before that.
- The threshold is tested company by company, on the gross value of related-party revenue and expenses, not the net.
- Disclosure of these transactions in the annual return is required whatever their size, and omitting it costs an amount equal to 1% of the value not disclosed.
- The country-by-country report is outside this exemption. The Egyptian Tax Authority's (ETA) guidelines set its threshold at EGP 3 billion of annual consolidated revenue for an Egyptian-parented group with a foreign subsidiary.
- Failing to file the local file or the master file costs an amount equal to 3% of the value of related-party transactions, and the report or notification 2%, capped at 3% where failures coincide.
The threshold in force and when it took effect
Article 12 of the Unified Tax Procedures Law, Law 206 of 2020, requires anyone with commercial or financial transactions with related persons to file three transfer pricing documents: the master file, the local file and the country-by-country report. Its fourth paragraph then exempts from the first two only:
"The person ... whose total value of dealings with related persons during the tax period does not exceed eight million pounds shall be exempt from the provisions of items (a, b) referred to, and the amount may be increased by decree of the Minister." (Article 12)
The Minister has used that power twice:
| Threshold | Instrument and publication | In force from |
|---|---|---|
| EGP 8 million | Article 12 of Law 206 of 2020, Official Gazette Issue 42 bis (c), 19 October 2020 | 20 October 2020 |
| EGP 15 million | Minister of Finance Decree 52 of 2024, Al-Waqa'i al-Misriya Issue 38 (continued) (h), 15 February 2024 | 16 February 2024 |
| EGP 30 million | Minister of Finance Decree 534 of 2025, Al-Waqa'i al-Misriya Issue 284 (continued) (a), 17 December 2025 | 18 December 2025 |
Neither decree names a tax period. Each provides that it comes into force "from the day following the date of its publication": Decree 52 of 2024 from 16 February 2024 and Decree 534 of 2025 from 18 December 2025. As at 9 October 2026 the ETA had published no instruction on which tax periods each threshold governs.
How the threshold is measured and who falls outside it
The text measures the person's "total value of dealings", so each group company is tested on its own transactions. Article 14 of the Executive Regulations, issued by Minister of Finance Decree 286 of 2021, requires the calculation "on the basis of the total value of transactions with related persons, of revenue and expenses, during the taxpayer's financial year, and not the net of those transactions". A company that sold EGP 18 million to a sister company and bought EGP 14 million from it has EGP 32 million of transactions and needs both files, although the net is EGP 4 million.
The same article lists, as examples, sales and purchases of goods, services and assets, recharged expenses, royalties, and loans and credit facilities. The ETA's Interpretive Instructions No. 78 of 2023 add that dividends "are not counted among the transactions with related persons".
The related person need not be non-resident: the ETA's guidelines "apply to transactions between associated enterprises resident in Egypt, as well as to transactions between enterprises resident in Egypt and their non-resident associated enterprises". Article 14 of the Regulations brings a non-resident legal person's permanent establishment within Articles 12 and 13. The definition of a related person is covered in Transfer Pricing in Egypt: Article 30 and the Executive Regulations.
Falling below the threshold exempts from the two files only. Disclosure in the return remains due, and the ETA keeps its power under Article 30 of the Income Tax Law to "determine the taxable profit on the basis of the arm's length price".
The country-by-country report and the notification
Neither the law nor the Regulations sets a figure for the report. The law allows the Minister, or a person the Minister delegates, to exempt from it "according to the circumstances of each company, and in line with international practice", and the Regulations refer to "the guide issued by the Minister". The thresholds are in the Egyptian Transfer Pricing Guidelines and have applied from the financial year ending 31 December 2018:
| Ultimate parent | Threshold and where the report is filed |
|---|---|
| Resident in Egypt | Consolidated revenue of EGP 3 billion or more; filed with the ETA if the group has a foreign subsidiary |
| Foreign | Consolidated revenue of EUR 750 million or more; filed in the ultimate parent's country, not with the ETA |
The law and the Regulations also refer to a country-by-country "notification". Article 14 of the Regulations requires all legal persons, "including companies operating under the free zones system and permanent establishments of non-resident legal persons", to submit a country-by-country "report/notification, as the case may be". Neither the published texts nor the guidelines set the content or the date of the notification.
Deadlines
| Document | Deadline | Source |
|---|---|---|
| Disclosure (Schedule 508 of the return) | With the annual return: for legal persons, before 1 May or within four months of the financial year-end | Articles 13 and 31 of the law; Instructions 78 |
| Local file | Within two months of the date the return is actually filed, or of an amended return filed within 30 days after the return deadline | Articles 13 and 33 of the law; Instructions 78 of 2023 |
| Master file | The filing date in the foreign parent's country; the local-file date where the parent is Egyptian, its country does not require one, or it is a free-zone company | Article 13; Article 15 of the Regulations; Instructions 78 |
| Country-by-country report | Within one year of the end of the tax year concerned | Article 13 |
A company whose financial year ends on 30 June 2026 files its return by 31 October 2026 and its local file within two months of filing. The 2025 report of an Egyptian-parented group with a calendar year is due by 31 December 2026.
Amounts due and penalties
The financial charge is in the last paragraph of Article 13 as replaced by Law 211 of 2020, in force from 4 December 2020:
"... to pay the Authority an amount equal to: (1%) of the value of the transactions with related persons not declared, in case of non-disclosure in the tax return ... (3%) ... in case of failure to submit the local file. (3%) ... in case of failure to submit the master file. (2%) ... in case of failure to submit the country-by-country report or notification. The said amount may not exceed the equivalent of (3%) of the value of the transactions with related persons where the above violations are multiple." (Article 13)
Article 18 of the Regulations computes the last three on the total value of related-party transactions, so a company with EGP 40 million of them that does not file its local file pays EGP 1.2 million. The ETA claims the amount once the taxpayer has passed the legal deadline for the file, the report or the notification (Article 17 of the Regulations). The 1% is not waived "even if the taxpayer has disclosed these transactions in the local or master file" (Article 16 of the Regulations); a file that does not meet the guide's requirements is "not recognised technically or legally" (Article 19 of the Regulations); and payment does not prevent any other fine or penalty (Article 20 of the Regulations). Under Instructions 78 of 2023, no late-payment charge runs on these amounts.
Article 69(d) of the law also punishes failure to comply with Articles 12 and 13 with a fine of EGP 3,000 to EGP 50,000, tripled at both limits for a repeat offence. Where documents are not filed, the ETA may set the pricing rules it considers appropriate, and a taxpayer who appeals bears the burden of proof (Article 14 of the Regulations).
What this requires
- Total each company's related-party transactions, revenue and expenses together, for each tax period, and compare the total with the threshold, EGP 30 million from 18 December 2025.
- Complete Schedule 508 of the return in every case, even below the threshold.
- Count the local-file deadline from the date the return is actually filed, and recount it if an amended return is filed within 30 days after the return deadline.
- Establish the master-file date in the parent's country, or use the local-file date where the rules require it.
- File the 2025 report by 31 December 2026 if the group's parent is Egyptian, its consolidated revenue is EGP 3 billion or more, it has a foreign subsidiary and its year is the calendar year.
- Confirm the content and date of the notification with the ETA, and check every file against the guide's sections before filing it.
The firm's Tax Department measures related-party transactions against the threshold, prepares and files local and master files on time, and reviews their disclosure in the return.
Mahmoud Nassef, Founder Partner
Chartered Accountant, Ministry of Finance, Egypt
Member, Egyptian Society of Accountants & Auditors
Member, Egyptian Tax Society
Member, Egyptian Society for Public Finance and Taxation
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Disclaimer: This bulletin is prepared for general information on the legislation in force at the date of its publication. It does not constitute a professional opinion or tax or legal advice on any particular matter, and it should not be relied upon in place of advice based on an examination of the circumstances of each case. Nassef & Partners International accepts no responsibility for any action taken, or refrained from, in reliance on its contents. The positions stated remain subject to subsequent legislation and decisions.