Income Tax in Lebanon: Salaries, Business Profits and Professions

Short answer: Income tax in Lebanon is schedular: Lebanon’s Income Tax Law taxes each type of income under its own chapter instead of adding everything into one global income. Business and professional profits, salaries and wages, and income from movable capital each have their own rates, deductions and filing rules. Companies pay a flat 17%, salaries are taxed progressively from 2% to 25%, and dividends and interest face a 10% withholding tax.

Lebanese amounts were rewritten several times after the currency collapse, so every figure below names its law or source.

Last updated: October 2026

How does income tax in Lebanon work?

Lebanon taxes income by source, not by person. Each of the three chapters has its own base, rates and return.

According to [Source: PwC Worldwide Tax Summaries, Lebanon individual income determination], the three chapters are:

• Chapter I: profits of industrial, commercial and non-commercial professions (companies, traders, and professionals such as doctors, lawyers and accountants).
• Chapter II: salaries, wages and pensions.
• Chapter III: income from movable capital, such as dividends, interest and directors’ fees.

The same PwC page notes that the law applies no global progressive tax on combined income. Someone with a salary and a side practice therefore deals with two separate taxes.

For accountants, the practical point is to classify the income first. Treating a consultant’s fees as salary, for example, changes the rate, the deductions and the deadline at once.

What are the main Lebanon income tax rates in 2026?

The headline rates are 17% for companies, 2% to 25% for salaries, 4% to 25% for sole proprietors and general partnerships, and 10% on movable capital income. The table below collects the figures from PwC’s Lebanon summaries, all last reviewed on 1 July 2026.

Sources: [Source: PwC, Lebanon corporate taxes on income] and [Source: PwC, Lebanon individual taxes on personal income]. VAT is a separate tax on consumption and is not part of income tax; we cover it in our guide to VAT in Lebanon.

How is salary tax calculated in Lebanon?

Salary tax is withheld by the employer and charged progressively, from 2% on the lowest band to 25% on the highest, after family deductions are subtracted from annual taxable pay. Pensions and similar benefits are taxed at half the normal rates.

The bands are the part that keeps moving. PwC’s personal income summary says the 2022 Budget Law replaced the old annual band limits of LL 6 million and LL 225 million with LL 18 million and LL 675 million. Some payroll references publish much higher bands for 2024 and 2025, attributed to a later Ministry decision. We could not confirm those against Ministry text and they differ from PwC, so we leave them out: confirm the table in force before you run payroll.

Family deductions did change by law. Under [Source: PwC, Lebanon individual deductions], Article 49 of Budget Law 2024 (dated 15 February 2024) set family deductions at LL 450 million to LL 900 million a year depending on family status, up from LL 37.5 million to LL 62.5 million.

The same page lists items outside the taxable base within limits, including a private sector transportation allowance of LL 450,000 per day from 15 February 2024 (Decree 12966) and a schooling allowance of up to LL 6 million for a maximum of three children.

Social security is a separate charge on the same payslip. Our article on NSSF contributions in Lebanon covers it, and Payroll, Tax & Social Security Mastery works through both together.

How are business and professional profits taxed?

Companies pay a flat 17% on taxable profit, while sole proprietors and general partnerships pay progressive rates from 4% to 25%, on real profit or on a lump-sum basis.

The 17% rate comes from PwC’s corporate summary. For individuals running a business, PwC’s personal income page reports that the 2024 Budget Law raised the profits tax brackets to a range of LL 540 million to LL 13.5 billion.

PwC’s deductions page adds that sole proprietorships and general partnerships get no deductions, since tax is based on actual profit or a fixed percentage of revenue set by profession, while limited partnerships get the same deductions as corporations. Taxing real profit depends on sound books, which is where Lebanese Accounting Law in Practice fits.

How is income from movable capital taxed?

Income from movable capital generated in Lebanon is taxed by a 10% withholding at source.

[Source: PwC, Lebanon individual income determination] lists dividends, interest, directors’ fees, profit distributions and interest on corporate loans as covered. The same page states that individuals are exempt from capital gains tax on transferring shares, but that Decision No. 323 of 15 May 2023 applies the 10% movable capital tax to individuals who dispose of shares in limited liability companies when the sale is not a commercial transaction for the seller.

Who withholds income tax, and when are returns due?

Employers withhold and declare salary tax; businesses and professionals file their own profits tax returns once a year. The fiscal year is the calendar year, and payment deadlines match filing deadlines.

According to [Source: PwC, Lebanon individual tax administration] and [Source: PwC, Lebanon corporate tax administration], both last reviewed on 1 July 2026:

• Payroll tax: the employer declares quarterly, within the first 15 days of the month after the quarter ends, and files an annual declaration by 28 February of the following year.
• Professionals taxed on real profit: before 1 April of the following year.
• Professionals on the lump-sum basis: before 1 February of the following year.
• Capital companies: by 31 May of the following year.

Treat these as the standard dates and check the Ministry’s notices each year for any change. Submissions go through the Ministry’s online portal, the focus of our step-by-step MoF portal filing course.

Why did income tax figures in Lebanon change after the currency collapse?

Lebanese tax bands and deductions are fixed in lira, so the collapse of the currency emptied the old amounts of meaning and forced repeated revisions.

The scale of the problem is clear from the World Bank’s May 2023 Lebanon Economic Monitor release: the currency lost more than 98% of its pre-crisis value by February 2023, and inflation averaged 171.2% in 2022. Lawmakers responded in stages. The 2022 Budget Law tripled the salary band limits, and the 2024 Budget Law raised family deductions by twelve times or more, as the sections above show.

The IMF has linked these readjustments to higher revenue. Its September 2023 end-of-mission release, issued by the staff team led by Ernesto Ramirez Rigo, listed among the actions taken so far:

“Readjustment of tax schedules and fees to plausible values, which has resulted in notably higher revenues.”
IMF staff team led by Ernesto Ramirez Rigo (IMF team leader for Lebanon), IMF Press Release No. 23/315, September 2023

So never copy a Lebanese tax figure from an old textbook or last year’s spreadsheet: check which law or decision is in force for the year you file.

How Balance Brightness can help

Mahmoud Chehade brings 30 years in practice and has trained more than 500 professionals, with live coaching in Hamra, Beirut, or online.

• Master Lebanese Tax Filing: Income Tax & VAT covers the income tax chapters and their returns.
• File Taxes on the MoF Portal, Step by Step covers the online submission.
• Payroll, Tax & Social Security Mastery covers salaries, withholding and NSSF.
• Law and Taxation for the LACPA Exam suits exam candidates (see our exam study guide).

Teams can choose corporate finance training; individuals can book one-on-one finance coaching.

Frequently asked questions

Is income tax in Lebanon calculated on total income?

No. Lebanon does not add all your income together and apply one rate. The Income Tax Law taxes each source under its own chapter: business and professional profits, salaries and wages, and movable capital income such as dividends and interest. Someone who earns a salary and also runs a side practice faces two separate calculations and potentially two filing obligations. Dividends and interest are settled by a 10% withholding at source. Classifying each payment correctly therefore decides the rate, the deductions and the deadline.

Do employees in Lebanon file their own income tax return?

Usually not. The employer withholds salary tax, declares it every quarter and files an annual declaration by 28 February of the following year, according to PwC’s Lebanon summary. The employee mainly needs to give accurate family status information, because family deductions reduce taxable salary. Professional or business income on the side is different: it falls under another chapter and needs its own return, due before 1 February (lump-sum basis) or 1 April (real profit basis). Keep separate records for each source of income.

What is the corporate income tax rate in Lebanon?

Capital companies pay corporate income tax at 17% of taxable profit, according to PwC’s Lebanon summary last reviewed in July 2026. When those profits are later paid out, a separate 10% withholding tax applies to dividend distributions. Sole proprietors and general partnerships are not taxed at the flat 17%; they pay progressive rates from 4% to 25%. Capital companies file by 31 May of the year after the income year, and payment follows the same deadline. Budget laws can amend rates and dates, so confirm the current position before filing.

Why do Lebanese tax brackets keep changing?

Because they are written in Lebanese pounds, and the pound lost more than 98% of its pre-crisis value by February 2023, according to the World Bank. Amounts fixed before the crisis stopped reflecting real incomes. Parliament has responded through budget laws: the 2022 Budget Law raised the salary band limits, and the 2024 Budget Law raised family deductions and the profits tax brackets. Different sources sometimes publish different tables for the same year, so check the law or decision behind any figure before using it.

The bottom line

Income tax in Lebanon is three taxes in one law: profits, salaries and movable capital, each with its own rules. The headline rates are steady, but the lira amounts behind them keep being rewritten. To file with confidence, start with Master Lebanese Tax Filing or talk to us about the right course for your role.

This article is general information about Lebanese income tax and is not tax, legal or financial advice. Rates, brackets and deadlines change with budget laws and Ministry decisions; confirm current rules with the Ministry of Finance or a licensed adviser before acting.

Sources

1. World Bank: Lebanon, Normalization of Crisis is No Road to Stabilization (press release, May 2023)
2. IMF: Press Release No. 23/315, IMF Staff Concludes Visit to Lebanon (September 2023)
3. PwC Worldwide Tax Summaries: Lebanon, Individual, Taxes on personal income
4. PwC Worldwide Tax Summaries: Lebanon, Individual, Deductions
5. PwC Worldwide Tax Summaries: Lebanon, Individual, Income determination
6. PwC Worldwide Tax Summaries: Lebanon, Individual, Tax administration
7. PwC Worldwide Tax Summaries: Lebanon, Corporate, Taxes on corporate income
8. PwC Worldwide Tax Summaries: Lebanon, Corporate, Tax administration