Frequently asked questions about Egypt VAT

What is VAT?

VAT is the abbreviation of Value Added Tax. VAT is in general due when goods and/or services are sold. It applies to most goods and services supplied for use or consumption in Egypt. VAT is a consumption tax because it is ultimately borne by the final consumer.

Who must pay VAT?

Generally, VAT is invoiced by the supplier that is selling taxable goods or services and collected from the customer. Subsequently, the supplier declares the VAT collected on sales and remits the VAT to the tax authorities on a monthly basis.

Zoom is registered for VAT in Egypt as a non-resident supplier of digital services. As such, Zoom is required to collect VAT on supplies to customers that are not registered for tax purposes in Egypt, such as non-registered persons, and remit the VAT to the Egyptian Tax Authority (“ETA”).

If you are a resident registered taxpayer in Egypt, you should provide your Tax Registration Number (“TRN”) to Zoom. If the TRN is valid, then no VAT will be charged on the supplies made to you by Zoom. If you do not provide a valid TRN to Zoom, then VAT will be charged on the supplies made to you by Zoom.

Why am I being charged VAT?

Video conferencing services supplied by Zoom fall under the category of digital services as they are services where, at the time of the performance of the service, there is no necessary connection between the physical location of the recipient and the place of physical performance. Therefore, Zoom (as a non-resident supplier of digital services) is required to charge VAT on such supplies to non-registered persons in Egypt at the standard rate of VAT with effect from June 22, 2023.

What is a Tax Registration Number (“TRN”)?

A Tax Registration Number (“TRN”) is a unique number assigned to businesses by the Egyptian Tax Authority (ETA) for tax purposes. A TRN identifies a customer as a resident registered taxpayer in Egypt.

How do I enter my Tax Registration Number (“TRN”)?

To provide your TRN, follow the steps below depending on where your billing portal is located in the left navigation menu of the Zoom web portal. Not sure how to identify where your billing portal is located? Learn how to locate your billing settings.

Zoom performs periodic validation checks of customer TRNs to ensure that the TRN remains valid. If, during these periodic validations, it is identified that your TRN is no longer valid, Zoom may automatically update your account so that future invoices are subject to VAT. Where this happens, VAT will be charged on all future invoices until such time that a valid TRN is provided.

You are required to notify us if there is a change to your tax registration status.

Does Zoom have a Tax Registration Number (“TRN”)?

Yes, Zoom is registered for VAT in Egypt as a non-resident supplier of digital services and Zoom’s registration number will be shown on the invoice it issues to you.

How is Zoom determining which customers VAT applies to?

If a customer's Sold To location is in Egypt, and the customer has not provided a valid TRN, Zoom will charge VAT on its invoices issued to you. This information is subject to cross-referencing against other data to verify that the ‘Sold To’ country is accurate.

It is your responsibility as a customer to ensure that your ‘Sold To’-address is accurate

Are there any special exemptions or zero-rating applicable for charities or other business organizations under which VAT may not be charged?

There are no VAT exemptions applicable in respect of digital services to non-profit organizations or international agencies in Egypt. Accordingly, Zoom is required to charge VAT to all customers that are not resident registered taxpayers in Egypt.

Are there any VAT obligations for me as a customer?

If you have provided a valid TRN to Zoom, no VAT will be charged on the supplies made to you. However, as a resident registered taxpayer, you may be obligated to self-account for VAT on supplies received via the reverse charge mechanism.

There is no VAT reporting obligation for a customer who is not a resident registered taxpayer in Egypt as Zoom will charge VAT on its supplies to you and remit such VAT to the tax authorities.

Will Zoom provide e-invoices?

As a non-resident supplier of digital services, Zoom is exempted from the provisions of the electronic tax invoice system in Egypt. Instead, non-resident suppliers providing taxable services to non-registered persons in Egypt are subject to specific invoicing rules. The invoice/receipt must contain the following data:

• A description of the service supplied, its amount, and the rate and the amount of VAT.
• The name and registration number of the non-resident supplier (Zoom).
• Invoice/receipt issuing date.
• Invoice/receipt number.

Zoom will issue invoices to customers in Egypt in accordance with the above-mentioned requirements.

What if I have a Tax Registration Number (“TRN”) and forget to enter it?

The TRN can be entered at any time. If a valid TRN is entered before the issuance of the next invoice, Zoom will not charge VAT on the next invoice or future invoices issued to you. If a valid TRN is not entered at the time of issuance of the next invoice, VAT will be charged until a valid TRN is entered. No retrospective adjustments will be made to invoices where you did not provide a valid TRN to Zoom on the basis that a resident registered taxpayer is required to provide its TRN to the non-resident vendor (Zoom) when the non-resident vendor (Zoom) renders services.

My Sold To address is Egypt; will I be charged VAT?

Disclaimer

Every customer is unique and so are their specific tax circumstances. The above-stated information should not be considered as tax advice, but as a general overview of relevant VAT rules in Egypt. Zoom cannot provide you with tax advice for your individual situation, and therefore we strongly recommend speaking with a professional tax advisor for tailored advice.