Instruction No. 46 of 2025 allows registered taxpayers to offset credit balances, including VAT, against outstanding taxes without formal refund procedures. The instructions respond to demands from the business community and align with directives from the Minister of Finance to simplify tax compliance and support investment.
The Egyptian Tax Authority (ETA) issued Instruction No. 46 of 2025, on Tuesday, 2 December 2025, establishing a formal procedure for registered taxpayers to offset credit balances, including VAT credits, against their outstanding tax liabilities.
This announcement was made on 3 December 2025.
The instructions, issued under Article 50 of Law No. 206 of 2020, respond to demands from the business community and align with directives from the Minister of Finance to simplify tax compliance and support investment.
Under the new rules, taxpayers can submit an offset request using Form No. 1 Offset, specifying the credit balance, relevant tax periods, and the liabilities to be offset. For audited cases, the ETA will review and respond within 20 working days. For unaudited cases, the process will be completed within two months, including any required audit procedures.
The offset applies only to final and undisputed credit balances as documented in Form 15 (Audit). If the credit exceeds the tax liability, the excess can be claimed through a standard refund request. The ETA confirmed that no additional taxes or penalties will apply if the credit balance was valid and sufficient at the time the liability arose.
Rosha Abdel Aal, Head of the ETA, emphasised that the new instructions simplify the offset process and allow it to be carried out without engaging in the formal tax refund procedures, helping investors preserve liquidity and reinvest in their operations.
