A. Update

The Ministry of Finance has issued Decision No. 959 on September 05, 2024 with respect to the payroll tax calculation for salaries denominated in foreign currencies, tax brackets and family exemptions which are to be applied for the tax year 2025 (for January to December 2025) as under:

A. Amended annual taxable brackets for salaries and wages:

B. Statutory Compliance Release Date: September 05, 2024

C. Effective Date: January 01, 2025

A. Update

The Ministry of Finance has issued Decision No. 959 on September 05, 2024 with respect to the payroll tax calculation for salaries denominated in foreign currencies, tax brackets and family exemptions which are to be applied for the tax year 2024 as under:

A. Amended annual taxable brackets for salaries and wages:

B. Revised family exemption limits:

The family exemptions, as per the budget law 2022, are applicable from January 01 till February 15 2024, and new family exemptions, as per the budget law 2024, are applicable from February 16 till December 31 2024.

C. Conversion rate in 2024

In accordance with the MOF issued decision, it is stipulated that the actual value of salaries denominated in USD is converted to LBP as follows:

For the period from January 01, 2024 till March 31, 2024:

1. Salaries paid in cash - according to the rate of USD 1 = LBP 15,000.

2. Salaries paid by check or by a bank transfer inside of Lebanon, the rates are as follows:

• USD 1 = LBP 8,000 for monthly salaries not exceeding USD 3,000.
• USD 1 = LBP 1,507.5 for the remaining monthly salary amounts exceeding USD 3,000.

For the period starting April 01, 2024:

According to Decision no. 302 (and its amendments) dated April 03, 2024, conversion rate of USD 1 = LBP 89,500 is to be used.

B. Statutory Compliance Release Date: September 05, 2024

C. Effective Date: January 01, 2024

A. Update

The Ministry of Finance has recently issued decision no. 791 with respect to the application of Articles 17 & 54 of Law no. 324 (Budget Law of year 2024.

This decision stipulates that effective from April 01, 2024, the taxable amounts earned by non-residents are set at 50% if it is related to rendering of service, and 20% if it is related to others.

The withholding tax is accordingly calculated at the rate of 17% of the taxable amounts increasing from the previous rate of 15% on the taxable amount.

The flat tax rate for non-residents is now 8.5% instead of 7.5%, and 3.4% instead of 2.25%, respectively, for rendering of service and other activities. For payroll, 8.5% will be considered for wages pa

The decision also stipulates that effective from April 01, 2024, the withholding tax should be filed and paid in USD or Euro if the taxable amounts were paid according to these two currencies; by adopting new forms which are to be circulated by the Ministry of Finance. Other currencies are to be converted to USD according to their market exchange rates for the purpose of filing and paying the relative withholding tax.

B. Statutory Compliance Release Date: July 24, 2024

C. Effective Date: April 01, 2024

A. Update

The National Social Security (NSSF) has issued memorandum no. 754, effecting an increase in the maximum salary subject to NSSF Maternity and Sickness contributions.

The said increase is in response to the minimum salary rising from the current LBP 9,000,000 to LBP 18,000,000, as declared via Decree No. 13164.

Consequently, the maximum salary subject to NSSF Maternity and Sickness contributions has been revised upward to LBP 90,000,000 from its previous limit of LBP 45,000,000.

B. Statutory Compliance Release Date: April 24, 2024

C. Effective Date: April 01, 2024

A. Update

The Lebanese Government has issued Decree no. 13225, and accordingly following changes have been introduced in the schooling allowances provided to employees for academic year 2023 - 2024:

The schooling allowances to employees has increased as follows:

• Allowance has been increased to LBP 4,000,000 from LBP 3,000,000 for each student in public or free schools, free institution for those with special needs, or the Lebanese university, thus maximum capping LBP 12,000,000 from LBP 9,000,000 in total.
• Allowance has been increased to LBP 12,000,000 from LBP 6,000,000 for each student who is enrolled in a private school or a private university, thus maximum capping increased to LBP 36,000,000 from LBP 18,000,000 in total.

B. Statutory Compliance Release Date: April 18, 2024

C. Effective Date: April 18, 2024

A. Update

The newly introduced Decree No. 12962, by the Lebanese Government (referred to as 'the Decree'), has amended the maximum salary subject to the Maternity and Sickness branches of NSSF contribution.

Pursuant to this Decree, the maximum salary subject to NSSF Maternity and Sickness contribution has been elevated to LBP 45,000,000, marking an increase from the previous monthly limit of LBP 18,000,000.

B. Statutory Release Date: February 15, 2024

C. Effective Date: March 01, 2024

A. Update

The Lebanese Government has enacted Decree No. 12966 (referred to as 'the Decree'), which brings about a modification to the daily transportation allowance applicable to employees in the private sector.

Consequently, the daily transportation allowance has been raised from the existing LBP 250,000 per working day to LBP 450,000

B. Statutory Compliance Release Date: February 15, 2024

C. Effective Date: February 15, 2024

A. Update

The National Social Security Fund (NSSF) issued Memorandum no. 740, In accordance with the said memorandum, it is stipulated that contributions to the NSSF for salaries denominated in foreign currency must be calculated and settled based on the highest official foreign exchange rate established by the Central Bank of Lebanon.

Presently, this rate stands at USD 1 = LBP 89,500.

B. Statutory Release Date: February 01, 2024

C. Effective Date: February 01, 2024

A. Update

The Lebanese Government has approved the Budget for the year 2024. Subsequently, modifications have been implemented in the salary brackets outlined in the tax table (Article 58) and the family exemption (Article 31) of the income tax law.

Comprehensive details can be referenced in the tables presented below:

Updated annual tax table:

Updated annual family exemption:

Disclaimer: The Ministry of Finance (MOF) has not provided clarification regarding the implementation of the aforementioned changes. Currently, these adjustments are tentatively being applied from February 2024, with pending clarification from the MOF

B. Statutory Compliance Release Date: February 15, 2024

C. Effective Date: February 01, 2024

A. Update

The Lebanese Government has enacted Decree No. 12772, hereby amending Article 68 (paragraph 2) of the National Social Security Fund (NSSF) Law. These modifications pertain to the adjustment of the maximum salary eligible for deduction under the NSSF family allowance branch.

The decree specifically raises the monthly salary ceiling to LBP 12,000,000, marking an increase from the existing ceiling of LBP 2,825,000.

B. Statutory Release Date: December 28, 2023

C. Effective Date: January 01,2024

A. Update

The Lebanese Government has issued Decree no. 12599 (‘the Decree’) introducing amendments to the family allowances provided by the National Social Security Fund (NSSF).

The revised allowances are as follows:

• LBP 600,000 designated for the wife.
• LBP 330,000 allocated for each child, with consideration for up to 5 children.

The total family allowances shall be capped at LBP 2,250,000.

The Lebanese govt has released decree no. 12772, and accordingly the above changes are now effective starting the month following its publication in the Official Gazette i.e., 1st Jan 2024

B. Statutory Release Date: November 30, 2023

C. Effective Date: January 01, 2024

A. Update

The Lebanese Government has issued Decree no. 11928 (‘the Decree’) amending Article 68 (paragraph 2) of the National Social Security Fund Law in respect of adjusting the maximum earnings subject to the NSSF Maternity & Sickness contribution.

As per the Decree the maximum earning subject to NSSF Maternity & Sickness contribution has been increased to LBP 216,000,000 annually. As a result, the corresponding updated monthly threshold now stands at LBP 18,000,000, a notable increase from the previous monthly limit of LBP 5,600,000.

B. Statutory Compliance Release Date: August 24, 2023

C. Effective Date: September 01,2023

A. Update

The Lebanese Government has introduced Decree no. 11343 which aims to amend Decree no. 11226 dated 18/04/2023 related to adjustment of cost-of-living allowance.

An additional amount of LBP 6,400,000 to be increased instead of LBP 4,500,000 for monthly salaries as an adjustment of cost-of-living allowance. The remaining text of Decree 11226 remains with no amendment.

The National Social Security Fund (NSSF) also issued memorandum no. 711 regarding the amendment of the treatment in NSSF Memorandum no. 710 dated 11/05/2023, for the adjustment of cost-of-living allowance and minimum salary, as per Decree no. 11226 dated 18/04/2023 which states:

• Additional LBP 6,400,000 increase on monthly salaries as an adjustment of cost-of-living allowance instead of LBP 4,500,000.
• An additional LBP 246,000 increase on daily salaries to reach the daily minimum salary set as LBP 410,000.
• Contributions paid to NSSF as per Memorandum no. 710 for April and May 2023 are to be deducted, and the new adjusted contributions balance shall be paid via another two schedules for April and May separately.

The remainder of the memorandum remains with no amendment.

B. Statutory Compliance Release Date: June 08, 2023 & June 13, 2023

C. Effective Date: June 08,2023 & April 26, 2023

A. Update

Lebanese Government has released the following Decrees to increase the daily transportation allowance, adjustment of cost-of-living allowance & minimum monthly and daily salaries and schooling allowance.

1. Increase in daily transportation allowance.

Vide Decree no. 11224, daily transportation allowance has been increased from the current LBP 95,000 per day to LBP 250,000 applicable to all employees in private sector.

2. Increase in adjustment of cost-of-living allowance & minimum monthly and daily salaries.

Vide Decree no. 11226, the following has been updated:

1. The cost-of-living adjustment of LBP 4,500,000 to be provided to all employees subject to labour law.
2. The monthly & daily minimum salary is set to be LBP 9,000,000 and LBP 410,000 respectively.

3. Increase in schooling allowance to the education year of 2022-2023

Vide Decree no. 11228, schooling allowance for the Education Year of 2022-2023 has been increased as follows:

1. Students who are enrolled in public schools, free schools, free organizations for those with special needs or the Lebanese university, an increase in schooling allowance from LBP to LBP 3,000,000 per child with maximum capping of LBP 9,000,000.
2. Students who are enrolled in a private school or a private university, an increase in schooling allowance from to LBP 6,000,000 for each child with maximum capping of LBP 18,000,000.

B. Statutory Release Date: April 26, 2023

C. Effective Date: April 26,2023

A. Update

For the application of Article 35 of the Government Budget Law 2022, the Ministry of Finance and Central Bank of Lebanon has issued Decision no. 2 and 3, in respect to the payment of salaries in foreign currencies and withholding and settling of the payroll tax for the year 2022 and onwards.

1. If salaries/wages are denominated in foreign currency and paid in cash the following exchange rate will be applicable:

• Before 15/11/2022, according to exchange rate USD 1= LBP 8,000.
• After 15/11/2022, according to exchange rare USD 1= LBP 15,000.

2. If salaries/wages are paid by cheque or by a bank transfer inside of Lebanon, the exchange rates are as follows:

• USD 1= LBP 8,000 for monthly salaries not exceeding USD 3,000.
• USD 1 = LBP 1,507.5 for the remaining monthly salary amounts exceeding USD 3,000.

3. If salaries and wages are paid in foreign currency other than the US dollar, the currency is converted into the US dollar at the average exchange rate between foreign currencies against the US dollar, and these salaries and wages are then remitted to the Lebanese pound according as mentioned above.

4. Salaries paid in USD, or any foreign currency are to be recorded as an expense at their actual value.

5. Employers who kept paying salaries in LBP are to apply for a refund while filing the payroll tax returns after conducting a tax review by the tax authorities.

6. MOF Decision number 687 dated 23/11/2022 is to be cancelled.

B. Statutory Compliance Release Date: January 09, 2023

C. Effective Date: November 15,2022

A. Update:

The Lebanese government issued Decree no. 10598 in respect of the minimum monthly and daily salaries, whereby salaries are increased for cost-of-living as provided below:

1. The cost-of-living adjustment of 600,000 LBP is to be done for employees receiving monthly salaries and 28,000 LBP for those employees receiving daily salaries.
2. The additional adjustment of cost of living shall be subject to National Social Security Fund contributions according to Article 68 of the NSSF Law.

To accommodate the above changes, the National Social Security Fund (NSSF) also issued Memorandum no. 694 regarding applying Decree no. 10598 which states that:

1. The monthly salary and daily salary to be increased by 600,000 LBP and 28,000 LBP respectively

2 .There is an increase of LBP 600,000 in the sickness & maternity ceiling and family allowance ceiling.

• For Sickness & Maternity: now the ceiling will be LBP 5,600,000 from earlier limit of LBP 5,000,000.
• For the family allowance: now the ceiling will be 3,425,000 LBP instead of LBP 2,825,000.

B. Statutory Release Date: October 20, 2022 & October 25, 2022

C. Effective Date: October 01,2022

Lebanese Government released Budget 2022 in the official Gazette on November 15, 2022, the relevant amendments affecting payroll are summarized below:

A. Article 31: Family exemption limits has been revised

Annual Family exemption limit has been revised and the new limits are:

1. For taxpayer self: 37,500,000 Lebanese Pound (LBP)
2. For Spouse (non-working): 12,500,000 LBP
3. For each child: 2,500,000 LBP (up to 5 children)

The condition to avail the above exemption is same as required previously.

B. Article No. 33: New Progressive tax rate table applicable to resident employee:

Lebanese Government has raised the salary bracket for resident Individuals in the Budget 2022, the amended tax table is as below:

C. Article 34: Exemption for Daily/hourly workers

All daily and hourly paid workers, an exemption of LBP 125,000 per day can be claimed from their basic pay, irrespective of their family status.

D. Article 35: Tax payment on its actual value

For employees getting the salary is foreign currency, the employers are required to withhold and settle tax on salaries in LBP at its actual value, which needs to be determined by a decision issued by the Ministry of Finance and the Central Bank of Lebanon.

E. Article 36: Exceptional rules applied to employment termination benefits

Termination and resignation allowances granted in the period from 1/7/2019 till 30/09/2022 were exempt from withholding tax. From 01/10/2022, such allowances are taxable in the hands of the employee.

F. Article 37: Cash and In-kind support granted during year 2022

Cash and in-kind support are considered as deductible expenses in the calculation of the taxable profit of the employer. However, they are not subject to social security contributions.

G. Article 49: Modification in the definition of taxable income

The gross income earlier included the total of salaries, wages, allowances, compensations, awards, gratuities, cash, and in-kind benefits. Moreover, now the definition has been extended to include a scenario where in case of a reduction on the said salaries and benefits due to a legal justification or reduction of work hours, taxes should be computed and settled based on the reduced amounts.

H. Exemption from tax for employees permanently disabled because of the Beirut Port Blast

Employees who have been permanently disabled because of the Beirut Port blast, are exempt from income tax on their salaries.

B. Statutory Release Date: November 15, 2022

C. Effective Date: January 01,2022

A. Update

The Lebanese government issued Decree no. 10598 in respect of the minimum monthly and daily salaries, whereby salaries are increased for cost-of-living as provided below:

1. The cost-of-living adjustment of 600,000 LBP is to be done for employees receiving monthly salaries and 28,000 LBP for those employees receiving daily salaries.
2. The additional adjustment of cost of living shall be subject to National Social Security Fund contributions according to Article 68 of the NSSF Law.

To accommodate the above changes, the National Social Security Fund (NSSF) also issued Memorandum no. 694 regarding applying Decree no. 10598 which states that:

1. The monthly salary and daily salary to be increased by 600,000 LBP and 28,000 LBP respectively
2. There is an increase of LBP 600,000 in the sickness & maternity ceiling and family allowance ceiling.
• For Sickness & Maternity: now the ceiling will be LBP 5,600,000 from earlier limit of LBP 5,000,000.
• For the family allowance: now the ceiling will be 3,425,000 LBP instead of LBP 2,825,000.

B. Statutory Compliance Release Date: October 20, 2022 & October 25, 2022

C. Effective Date: October 01,2022

A. Update

The Lebanese government issued Decree no. 9849 amending the daily transportation allowance for private sector employees. The said allowance has been increased from LBP 65,000 to LBP 95,000

B. Statutory Compliance Release Date: August 18, 2022

C. Effective Date: August 18,2022

A. Update

As per the Decree no. 9415 issued by Lebanese government, article 68 (paragraph 2) of the National Social Security Fund law stands amend in respect of adjusting the maximum earnings subject to deductions for the NSSF Maternity & Sickness.

Accordingly, maximum earning limit for calculating Maternity & Sickness Contribution is now LBP 5,000,000 instead of LBP 3,825,000.

B. Statutory Compliance Release Date: June 23,2022

C. Effective Date: July 01,2022

A. Update

The Lebanese government issued Decree no. 9129 amending Decree no. 7426/2012 in respect of the minimum monthly salaries, whereby salaries are increased for cost-of-living as provided below:

• The cost-of-living adjustment of 1,325,000 LBP is to be done for those employees whose salaries are less than 4,000,000 LBP as of March 2022.
• As for the salaries above LBP 4,000,000, the increase is to be determined based on collective agreements and International Labour Organization conventions concluded with Lebanon especially Agreement no. 131 concluded under decree no. 70 dated 25/6/1977.

To accommodate the above changes, the National Social Security Fund (NSSF) also issued Memorandum no. 686 regarding applying Decree no. 9129 which states that:

• The minimum monthly salary currently at 675,000 LBP is to be increased by 1,325,000 to reach new monthly minimum of 2,000,000 LBP
• For monthly NSSF paying entity, increase of April’s contributions, resulting from the above adjustment would be paid in a separate contributions schedule (code 33), where its penalties would apply starting July 01, 2022
• There is an increase of LBP 1,325,000 in the sickness & maternity ceiling and family allowance ceiling.
  - For Sickness & Maternity: now the ceiling will be LBP 3,825,000 from earlier limit of LBP 2,500,000,
  - For the family allowance: now the ceiling will be LBP 2,825,000 instead of LBP 1,500,000.

B. Statutory Compliance Release Date: May 19, 2022 & June 06, 2022

C. Effective Date: April 01,2022

A. Update

A per Decree no. 8740, the daily transportation allowance has been increased to 65,000 LBP from 24,000 LBP earlier.

B. Statutory Compliance Release Date: February 03, 2022

C. Effective Date: February 03, 2022

A. Update

As per Decree no. 8738, released on February 3, following changes have been made in the schooling allowances provided to employees for academic year 2021-2022:

• Allowances has been increased to 1,000,000 Lebanese Pounds (LBP) for each student in public or free schools, free institution for those with special needs, or the Lebanese university from earlier limit of 300,000 or 450,000 LBP, as may be applicable.
• Allowances has been increased to 2,000,000 LBP for each student in a private school or universities from 750,000 LBP earlier.
• The number of benefiting children is limited to 3 children only, and the schooling allowances must not exceed 4,000,000 LBP in total. The earlier total limit was 1,500,000 LBP.

To be eligible for the above allowance, employees need to satisfy the following conditions:

• The student(s) should have completed the age of three before January 31 of the school year and should not have reached the age of twenty-five.
• Students shall be enrolled in a university or formal school. Night schools shall not be considered regular schools.
• With respect to female employee, allowance shall only be granted if she bears the responsibility of their children and is paid family allowance or if her husband does not receive an education grant for her children.
• Allowance is granted only if one year of employment has been completed with the current employer before the start of the school.
• Irrespective of the grant amount provided by the employer, allowances are to be capped at maximum limit.
• The allowance shall not be considered a remuneration element, nor shall any fee or subscription tax be paid to the National Social Security Fund or be included in the calculation of end-of-service compensation.

B. Statutory Compliance Release Date: February 03, 2022

C. Effective Date: February 03, 2022

A. Update

The Ministry of Labour issued Decree no. 8318 in the official Gazette to amend Article 4 of Decree no. 6263 dated January 18, 1995 in respect of the daily transportation allowance due to employees and workers in the private sector. The daily allowable transportation has been increased to LBP 24,000 from LBP 8,000. The rest of the Decree dated January 18, 1995 remains unchanged.

B. Statutory Compliance Release Date: September 16, 2021

C. Effective Date: October 01, 2021

A. Update

The Ministry of labor has extended the deadlines for submitting the National Social Security Fund (NSSF) contributions related to the first half of the year 2020 for six months (i.e. January which deadline is in February as been extended till July 2020) in addition to extending the deadline for the annual NSSF declaration of the year 2019 till September 30, 2020.

Further please find below some details for better clarity:

• The deferral of NSSF contribution is related to only remittance and declaration (reporting).
• There is no impact on calculation and deduction of NSSF contribution from salary of the employee. Also, there is no impact on calculation of Income Tax.
• The due dates for remittance and reporting has been changed to the end of sixth month. For instance, end of July for Jan contribution, end of Aug for Feb contribution, end of Sep for March contribution and likewise for other months.
• There is no change in reports of NSSF. The reporting is as usual with the change in due dates for remittance and filing.

B. Statutory Compliance Release Date: April 08, 2020

C. Effective Date: January 01, 2020

A. Update

In order to further support stable employment and ensure employment, and reduce the tax burden of the new recruits' personal income tax withholding, the following is an announcement¹ regarding the improvement and adjustment of the personal income tax withholding for those who obtain wages and salary income for the first time in the middle of the year:

• For a resident individual who obtains income from wages and salaries for the first time in a tax year, the withholding agent can calculate the cumulative standard deduction by multiplying 5000 Yuan per month by the number of months ending in the taxpayer's current year. This means that in the first month of employment of such first-time earners, cumulative standard deduction shall be granted starting from January till the month of tax withholding in a tax year.
  For example, for a fresh graduate who commences employment on July 01, 2020 and receives the first salary for July, the deduction for that month will be the standard monthly amount of CNY 5,000 plus the accumulated deductions of CNY 30,000 for 6 months, from January to June, prior to the commencement of the first employment, i.e. CNY 35,000 in total.
• If a student receiving full-time academic education obtains labor remuneration for internship, the withholding agent should withhold personal income tax in the erstwhile cumulative manner, without giving effect to this announcement. In short, this announcement is not applicable to interns.
• Employees who comply with the provisions of this announcement should promptly declare to the withholding agent/employer and truthfully provide the relevant supporting materials or undertakings. Such supporting materials or undertakings should be kept for future reference.

B. Statutory Compliance Release Date: July 28, 2020

C. Effective Date: July 01, 2020