A comprehensive guide to setting up a company in Egypt
From choosing the legal form and trade name to the commercial register, the tax card and the accounting system: the main steps set out in plain language.
Setting up a company is not just a matter of obtaining papers; it is a set of decisions that affect liability, tax and finance for years. This guide sets out the main steps in plain language. Note: procedures, fees, time limits and requirements change from time to time, so no figures are given here; the rules currently in force should be confirmed with the office, the authority responsible for incorporation and the tax authority.
1. Define the activity and the partners clearly
Before any procedure, write an accurate description of the activity you will carry out: it is what will appear in the commercial register, and licences and tax treatment are built on it. Agree with your partners in writing on each partner’s share, who manages and who signs, how profits are distributed and what happens if one of you wants to leave.
2. Choose the right legal form
A sole proprietorship is owned by one person and is simpler to set up, but the owner is liable for its obligations with personal assets. Partnerships (such as general and limited partnerships) rest on trust between the partners, and a general partner is liable for the company’s debts. A limited liability company and a one-person company separate the company’s money from the partner’s, so liability is limited to the share. A joint stock company suits larger projects and many shareholders, and has more regulatory requirements. The choice depends on the level of risk, the number of partners and the plans for finance and expansion, and each form has different accounting and tax requirements.
3. Trade name and premises
Choose a trade name and make sure it is available and not already in use, and prepare the document for the premises (ownership or lease contract) in the form the competent bodies accept, because the premises are part of the commercial register and tax file details.
4. The partnership contract or articles of association
This is the document that governs the relationship between the partners: purpose, capital and partners’ shares, management and signing powers, distribution of profits and losses, and the rules for a partner joining or leaving. Drafting it carefully with a legal adviser avoids costly disputes later, and reviewing it with your accountant makes sure its clauses can be applied in the accounts.
5. Capital and the bank account
Set a capital that is enough to run the business in its first months, not merely to satisfy the form, and ask about the requirements for depositing and evidencing it for the legal form you chose. Open a bank account in the company’s name from the start so that its money is not mixed with the partners’ money.
6. Commercial register and tax card
Once the formation documents are complete, the business is entered in the commercial register, then the tax file is opened and the tax card is issued. At this stage ask which taxes you will be subject to, whether you must register for value added tax, and what applies to your activity regarding electronic invoices or receipts.
7. Licences and social insurance
Some activities need special licences or approvals before starting. When you hire employees, obligations arise towards social insurance and the labour office. Listing these requirements early prevents the business from being held up after it opens.
8. Set up the accounting system from day one
A suitable chart of accounts, a clear document flow for sales, purchases and expenses, and accounting software that fits your size. Recording the formation expenses themselves, with their documents, is part of this system. An organised start is far easier than correcting a whole year later.
9. After formation: periodic obligations
Forming the company is the beginning of the obligations, not the end: periodic and annual tax returns, orderly books and financial statements, and an audit may be required depending on the legal form. Keep their dates in one calendar, and confirm the dates currently in force with the office or the tax authority.
In short: the most important decision is the legal form, and the most important habit is being organised from day one. One session with your accountant and legal adviser before signing saves you costly amendments afterwards.
Note: this article is general accounting and tax information for awareness and is not professional advice on a specific case. Tax rates, thresholds and dates change, so confirm the rules currently in force with the office or the tax authority.
