Net to gross in Egypt: how to price a job offer when the candidate asks for a net salary

When a candidate says "I want EGP 15,000 net", the gross you write in the offer is not EGP 15,000 plus the tax on EGP 15,000. Tax and insurance are charged on the gross, and the gross is the number you are looking for, so the calculation goes in circles. The practical answer is to search for the gross whose net lands on the target. In 2026 a net of EGP 15,000 needs a gross of about EGP 19,114, and costs the employer about EGP 22,413 a month.

Why net → gross is not "net + tax"

Three things make a simple add-back wrong:

• Deductions are percentages of the gross, not of the net. Adding the tax on EGP 15,000 to EGP 15,000 gives a gross on which a higher tax is due.
• Tax is progressive. Each extra pound of gross may fall into a higher band than the last one, so the marginal rate climbs as you add.
• Insurance has a cap. Employee insurance is 11% of the insurable wage up to EGP 16,700 a month. Below the cap it moves with gross; above it, it is fixed at EGP 1,837.

Here is what the naive method produces, using the 2026 rules:

Target net	Deductions on a gross equal to the target	Naive gross (target + those deductions)	Net that gross actually pays	Shortfall
8,000	1,139.50	9,139.50	7,690.41	309.59
15,000	3,140.00	18,132.50	14,214.93	785.07
40,000	8,876.79	48,876.79	37,776.39	2,223.61

The shortfall grows with salary. At EGP 40,000 net the candidate would receive more than EGP 2,200 a month less than promised.

The iteration idea

There is no clean formula, so payroll software (SalaryEG included) does what a careful accountant would do by hand, only faster:

1. Guess a gross.
2. Run the full gross-to-net calculation: insurable wage, 11% insurance, annual taxable income (gross × 12 − insurance × 12 − EGP 20,000, rounded down to EGP 10), progressive tax ÷ 12, 0.05% martyrs' fund.
3. If the net is below the target, raise the guess; if above, lower it.
4. Repeat until the net is within a few piastres of the target.

The engine uses a bisection search: it starts with a range that certainly contains the answer and halves it about 80 times, which is why the gross comes back to the piastre. The result also carries an exact flag, explained below.

1. Gross salary
2. − Employee social insurance (11% of insurable wage)
3. − Personal exemption (20,000 ÷ 12)
4. = Taxable income (rounded down to EGP 10 a year)
5. × Brackets → salary tax
6. − Tax − Martyrs' Fund 0.05% − other deductions
7. = Net pay

Example 1: candidate wants EGP 8,000 net

Try it in the calculator

Every pound of extra gross here is partly eaten by insurance, so the gross is about 20% above the net.

Example 2: candidate wants EGP 15,000 net

Try it in the calculator

The gross is 27% above the net. Insurance has hit the cap, so from here on only tax grows.

Example 3: candidate wants EGP 40,000 net

Try it in the calculator

The gross is now 30% above the net, almost all of it tax. Note that the annual taxable income (EGP 580,070) sits just under the EGP 600,000 tier boundary. A slightly higher net demand would push the offer across it; see below.

How employer cost compares

Target net	Gross	Employee deductions	Employer insurance + emergency fund	Employer cost	Cost ÷ net
8,000	9,574.67	1,574.67	1,891.00	11,465.67	1.43
15,000	19,114.39	4,114.39	3,298.25	22,412.64	1.49
40,000	51,843.55	11,843.55	3,298.25	55,141.80	1.38

Employer contributions are flat at EGP 3,298.25 for anyone above the insurance cap, so the cost-to-net ratio peaks in the middle and then eases as salaries rise. For budgeting, a rule of thumb for 2026 is: total cost ≈ 1.4–1.5 × the promised net for salaries between EGP 8,000 and 40,000 net.

With the common 30% allowances structure (insurance on the basic wage only), the picture at the lower end changes: net EGP 8,000 needs a gross of EGP 9,309 (cost EGP 10,723.25) and net EGP 15,000 needs EGP 18,874.33 (cost EGP 21,741.78). At EGP 40,000 net nothing changes, because the basic wage is already above the cap.

The tier-boundary gap, explained simply

Egypt's salary tax removes the lower bands in steps as annual taxable income passes EGP 600,000, 700,000, 800,000, 900,000 and 1,200,000. At each of those points, tax jumps up for the whole income, not just for the extra pound. Net pay therefore dips:

Gross	Annual taxable income	Annual tax	Net pay
53,500	599,950	124,737.50	41,241.46
53,510	600,070	128,767.50	40,915.61

Ten pounds more gross, EGP 325.85 less net. The same net of about EGP 41,000 can therefore be produced by two different gross figures, one just below the boundary and one well above it. Asking the engine for a net of EGP 41,190 returns a gross of EGP 53,431.43; asking for EGP 41,200 returns EGP 53,889.57, a jump of almost EGP 458 for ten pounds of net.

This is where the exact flag comes in. The engine reports exact: true when the gross it found pays the target net to within EGP 1. If a target cannot be hit that closely, it reports exact: false and the nearest achievable net, so you can decide whether to round the offer up. In practice the dips are small and short, so most targets are reachable, but a net demand that lands near a boundary deserves a second look: a few hundred pounds more gross may cost the employer less than you expect, or more.

Common mistakes

• Promising "net" without defining it. Agree in writing that net means after social insurance, salary tax and the martyrs' fund, and before any voluntary deductions.
• Fixing the net in the contract. Egyptian contracts and insurance forms state the gross. If the contract guarantees a net, every change in tax law or insurance limits silently changes the employer's cost.
• Forgetting the January reset. Insurance limits rise each January (15% until 2027). An employee above the cap sees a slightly lower net in January unless the gross is adjusted.
• Ignoring bonuses. A bonus month raises that month's tax; the net-to-gross figure covers the regular salary only.
• Using last year's rules. The 2026 cap is EGP 16,700; using 2025's EGP 14,500 understates insurance and overstates net.

FAQ

Can I write the net salary in the offer letter?

You can state the expected net as information, but the contract and insurance registration should carry the gross. State that the net is calculated under the rules in force at the date of the offer.

Why does the gross change in January even though nothing was agreed?

Because the insurance cap and minimum move on 1 January. For an employee above the cap, insurance rises (EGP 1,595 → 1,837 between 2025 and 2026), taxable income falls slightly, and net moves by a few pounds.

Does the 30% allowances option always reduce the gross I need?

Only while the basic wage is below the insurance cap. Above it, the option makes no difference to net or cost.

What if the engine says exact: false?

Round the gross up to the next figure that pays at least the target net. The calculator shows the nearest achievable net so you can see the size of the gap.

Sources

• Income Tax Law 91/2005 as amended by Law 30/2023 and Law 7/2024 (brackets, EGP 20,000 exemption, tiered removal of lower bands, 27.5% above EGP 1.2m).
• Social Insurance and Pensions Law 148/2019 (11% employee, 18.75% employer; insurable wage limits).
• Law 156/2002 (Emergency Fund) and Law 16/2018 (Martyrs' and Victims' Fund).
• Egyptian Tax Authority, eta.gov.eg; National Organisation for Social Insurance, nosi.gov.eg.
• PwC Tax Summaries, Egypt — Individual: taxsummaries.pwc.com/egypt/individual/taxes-on-personal-income.