1. Chapter 1-1 Tax Accounting

2. Chapter 1-2 6- What are the sources of income? The income results from the wealth that is owned by the person, which is divided into two kinds: a.Mobile wealth: b. Real estate wealth:

3. Chapter 1-3 6- What are the sources of income? a. Mobile wealth: Include all wealth resulted from: Work. Capital. Work and capital. b. Real estate wealth: Include all wealth resulted from: Building. Agricultural land.

4. Chapter 1-4 First: The income resulted from mobile wealth: 1- Income resulted from work: We have two kinds of work: Someone works in the favor of other one and under his supervision (Worker), so he receives salaries. These salaries are subject to tax on salaries. Someone works for his own interest (not under supervision of other one), it is called free profession. Like: Doctors, lawyers the return of these persons is subject to free profession tax.

5. Chapter 1-5 2- Income resulted from capital (investing money only): If you have money, you can realize income from it by depositing it into the bank and getting interest, or investing it in company and getting interest or dividends. This interests or dividends are considered as income and should be subject to mobile capital revenue tax. However, the legislator exempted it from tax with conditions as we will see later. First: The income resulted from mobile wealth:

6. Chapter 1-6 3- Income resulted from work + capital Use your work and your capital to practice commercial or industrial activity, and the profit resulted from it is subject to commercial and industrial tax. First: The income resulted from mobile wealth:

7. Chapter 1-7 Second: The income resulted from real estate wealth: Real estate ( Building and agricultural land) could be rented to any one, so this rent is subject to tax.

8. Chapter 1-8 Summary: There are five sources of income resulted from wealth: 1.Salary is subject to tax. 2.Free profession is subject to tax. 3.Commercial and industrial activity is subject to tax. 4.Real estate wealth revenue is subject to tax. 5.Capital revenues are exempted.

9. Chapter 1-9 Characteristics of unified income tax According to income tax law for year 2005:“ an annual tax shall be impose on the total net income of natural persons resident in Egypt and non resident From this article we can conclude the following characteristics. persons with regard to their income realized in Egypt“

10. Chapter 1-10 1- It is an annual tax: This tax shall be imposing on the final result of all transactions and activity performed by the natural person during specific period of time determined by 12 months. 2- It is a direct tax: It is imposed on the income when taxpayer earned this income. 3- It is impose on the natural persons. The natural persons include: Individuals. Sole company. “juridical person like all other companies will subject to corporation income tax”

11. Chapter 1-11 4- It is impose on resident and non resident natural person with regard to his income realized in Egypt. The natural person is considering resident in Egypt if one of the following three criteria has been satisfied: If his staying in Egypt is more than 183 days continued or separate during the year. If his staying period in Egypt is 183 days exactly he will not consider a resident person. If he has ordinary resident place in Egypt. (When a person purchased building to stay in it). If he receiving his salary from Egyptian treasury regardless the type of treasury (private or public).

12. Chapter 1-12 5- It is impose on the total net income. This means that this tax will be imposed on: Commercial and industrial profit. Non commercial profit. Real state wealth. Salaries and the like.

13. Chapter 1-13 6- It is impose at progressive rates: Bracket no.1 includes income from LE. 5000 to less than LE.30000, tax rate = 10% Bracket no.2 includes income from LE. 30000 to less than LE.45000, tax rate =15% Bracket no.3 includes income from LE. 45000 to less than LE.250000, tax rate =20%. Bracket no.4 includes income LE. 250000 and more, tax rate =25%.

14. Chapter 1-14 Note: There is no tax for income under LE.5000