When do you graduate from an EOR to your own Egypt entity?

The calculation below uses USD as the comparison currency because Teamed charges in USD. Entity costs for a foreign-owned Egyptian entity are typically quoted in USD by professional services firms serving international clients. All entity figures are illustrative ranges only.

All entity cost figures in this table are typical ranges. They cover outsourced payroll, bookkeeping, statutory filings, and HR admin. They are illustrative, not law figures. Actual costs vary with entity type, the complexity of your benefit programme, and the professional services provider you use.

Employer social insurance at 18.75% applies on the insurable wage, which is capped at EGP 16,700 per month from January 2026. Above that cap, the rate still applies but only to the capped base. At high EGP salaries, the effective social insurance cost per employee is lower than at lower salaries as a percentage of total payroll. This compresses the crossover slightly at higher salary bands. Run the Crossover Calculator with your own headcount and salary band.

1. Calculate the EOR cost

   Multiply the Teamed fee (from $599 USD) by your planned Egypt headcount. This is the fixed variable cost. It grows linearly as you hire.

2. Estimate the entity fixed overhead

   Typically USD 2,500 to 4,000 per month for a small Egyptian entity. This covers outsourced payroll, bookkeeping, Arabic-language filings, NOSI administration, and first-point HR. This cost does not grow much until headcount exceeds 15.

3. Find the crossover headcount

   The crossover is where EOR monthly cost equals entity monthly overhead. For most Egypt salary bands, this is around 6 to 10 employees. Use the Crossover Calculator for your own numbers.

4. Factor in non-financial triggers

   The maths gives you a headcount threshold. Government contract eligibility, Arabic-language compliance capability, and market-validation reversibility are separate questions that may override the cost crossover in either direction.

5. Plan the graduation date

   Allow 8 to 12 weeks for entity formation before the first payroll on your own entity. Factor in 4 to 8 weeks extra for bank account opening. Start the GEMO process while EOR continues running.

These are typical ranges. They are not law figures. The Egyptian company registry fees are low but the professional services layer is not. The range reflects real market rates and varies with entity type, whether you use a wholly foreign-owned branch, a Shareholding Company (S.A.E.), or a Limited Liability Company (W.L.L.).

Why banking and Ministry registration are the bottlenecks

Egyptian banks have significantly tightened account-opening requirements for foreign-parented entities since 2023. Expect 4 to 8 weeks from application to an opened business account, depending on the bank and the origin country of the parent entity. Ministry of Investment registration and Tax Authority registration together add another 3 to 5 weeks. Plan for 8 to 12 weeks total before the first payroll date. Do not set a first payroll date before you start the bank account application.

These figures are typical market ranges for a small foreign-owned Egyptian entity with 1 to 15 employees. They are illustrative. They are not law figures. Actual costs depend on whether you outsource or hire in-house, and on the complexity of your payroll, benefits, and Arabic-language filing requirements.

Above 15 employees, dedicated Egyptian HR capacity and an in-house finance function typically become necessary. The cost band widens at that point. Arabic-language legal and tax requirements also increase complexity at scale.

Most cost comparisons skip the manager-liability dimension because it is hard to put a number on. It is worth naming explicitly before you decide.

Personal manager duties

Under Egyptian Companies Law No. 159 of 1981 and Labour Law No. 14 of 2025, the manager of a local entity must maintain a labour file for every employee, register each employee with the National Organisation for Social Insurance (NOSI) before their first working day, and remit social insurance contributions by the 15th of the following month. A manager who fails to register an employee is personally liable for back contributions plus penalties. These are personal obligations. They cannot be outsourced.

The compliance treadmill

• Social insurance registration: every new hire must be registered with NOSI before day one. Late registration results in personal fines and back contribution liability.
• Monthly payroll tax remittance: due within 15 days of the following month. Late remittance attracts penalty additions from the Egyptian Tax Authority.
• Annual corporate tax return: within 4 months of year-end. Late filing penalties apply.
• Ministry of Manpower labour file: must be kept current. Inspections are periodic. Violations result in fines and potential business suspension.
• Collective redundancy notification: any headcount reduction beyond individual terminations requires advance Ministry of Manpower notification. Timeline is subject to negotiation and not automatically short.
• Arabisation of documents: employment contracts, policies, and filings must be in Arabic or accompanied by certified Arabic translations.

Each filing is individually manageable. Stacked across a year, they consume real management attention and require an Arabic-language compliance capability. An EOR carries all of these on its own entity.

• Under 6 Egypt employees at average salaries: EOR is cheaper every month. The entity overhead has nothing to amortise against.
• Market validation phase: you are hiring 1 or 2 people to test commercial fit. Entity setup commits capital and management attention before you know whether the Egypt market will deliver.
• Project-based hires: 6 to 12 month engagements where the formation cost will not amortise before the project ends. Under Labour Law No. 14 of 2025, fixed-term contracts are permitted and the 3-month notice obligation does not apply at natural expiry.
• No Arabic-language compliance capability in-house: statutory filings, labour files, and employment contracts must be in Arabic. If your team cannot manage this, the EOR absorbs it.
• Acquired team you may divest: post-acquisition holding patterns where adding a local entity creates wind-up complexity and a formal dissolution process that you may not want to own.
• High severance exposure: employees on indefinite contracts accrue severance at half a month per year for the first 5 years. Early entity dissolution crystallises all of that at once.

• Sustained headcount above 10 Egypt employees at average salaries: the entity overhead amortises across enough people that per-head cost falls below the EOR fee.
• Government and public sector contracts: Egyptian public procurement rules typically require a locally incorporated or registered supplier. This is the single biggest structural reason for companies with a B2G revenue stream to incorporate.
• Tax residency and treaty access: some cross-border structures benefit from Egypt having a network of double tax treaties. Accessing those treaties typically requires an Egyptian-resident entity rather than employment via EOR.
• Cairo or Alexandria office and physical presence: if you are opening a physical office, client-facing showroom, or data centre, operating under EOR creates a misalignment between the employer of record and the physical presence. An entity resolves this cleanly.
• Multi-year commitment with growing headcount: the EOR crossover in Egypt sits around 6 to 10 employees. Past that point, the running cost of your own entity is lower every month. A 3-year growth plan that reaches 15 employees should begin the entity formation process at around 8 employees, not at 15.

The technical mechanic is contract novation: the employment contract transfers from the Teamed partner entity to your new Egyptian company on a specified date. All terms carry across. Salary, social insurance registration, leave entitlement, and continuous service date all remain unchanged. The employee sees a different employer name on their payslip. Nothing else changes.

What we do operationally:

• Stand up your Egyptian entity through GEMO, typically 8 to 12 weeks, while EOR continues running in parallel.
• Manage GAFI registration, Tax Authority registration, NOSI registration, and bank account opening as a single coordinated workstream.
• Novate every active employment contract on a single effective date.
• Transfer NOSI social insurance records to the new entity without any gap in coverage.
• File the final EOR-period payroll returns and open new Tax Authority and NOSI registrations on the entity from the novation date.
• Provide the same People Ops specialist as the post-graduation primary contact.

The Egyptian bank account timeline of 4 to 8 weeks is the most common reason graduation slips past the target date. We start the bank application at the same time as the company registration, not after it.

Real HR and legal experts handle your Egypt hires from the first offer letter through every NOSI submission and Tax Authority remittance. An actual person, not a chatbot or a pooled queue. There is no setup fee and no exit fee. Every employer cost passes through at cost, itemised on every invoice. You see the social insurance line at 18.75%, the annual leave entitlement for 15 days, and every other statutory cost. Nothing is hidden inside the management fee.

EOR payroll, contractor onboarding, and entity setup all live on one platform. Run the Crossover Calculator to see the month the model flips. Start from the Egypt hiring overview. Key sources: GAFI (General Authority for Investment) and Ministry of Manpower Egypt.