Consumption taxes

Nature of the tax

VAT - (MA'AM in Hewbrew)

Tax rate

16%

Reduced tax rate

Export of products and certain services is not subjected to VAT.

Other consumption taxes

Tax on Capital gains from real-estate is applicable on the sale of the real estate.
Purchase tax is deducted on some imports or local industrial production. For additional information, consult the Finance Ministry.

Corporate taxes

Tax rate

Tax rate for foreign companies

The resident companies are taxed on their total income, while the non-resident companies are taxed on incomes from activities in Israel.

Capital gains taxation

The standard rate is 25%

Main allowable deductions and tax credit

Deduction are granted when the company invests in scientific research in the fields of industry, agriculture, transport or energy. A deduction is possible at the time of investments in oil companies. For additional information, consult the Deloitte Tax Guide.

Other corporate taxes

Access the 2009 PKF Tax Guide on Israel.

Individual taxes

Tax rate

Allowable deductions and tax credit

Tax deductions are granted to residents of priority areas and far from the center of the country.

Special expatriate tax regime

Certain expatriates are subjected to a special system with a maximum rate of 25%, other follow the normal system. Foreign residents are exempted from taxes on capital gains resulting from share investments in the Tel-Aviv Stock Exchange.

Pour aller plus loin dans vos recherches nous vous proposons de connaître les taxes locales qui s'appliquent à votre produit.

Double taxation treaties

Countries with whom a double taxation treaty have been signed

Israel has signed financial agreements with several countries in the world.

Withholding taxes

Withholding tax rates are: 20/25% for dividends, 15/20 for interest and 15-25% for royalties.

Bilateral agreement

Israel and the United Kingdom are bound by a double taxation treaty: Yes

For more information

All information on Double Taxation Agreements on the website of the HMRC

HM Revenue & Customs website

We can find you the local taxes that apply to your product for you.

Accounting Rules

Tax year

The financial year starts from 1 January and ends on 31 December of the same year.

Accounting standards

Accounting in Israel started with the help of the "The American Institute of Certified Public Accountants "(AICPA). The accounting practices in these countries are similar to American practices. IFRS are extensively used.

Accounting regulation bodies

IASB

Accounting reports

The financial accounts include a balance sheet, an income statement, a cash flow account and an owner's equity account.

Publication requirements

Accounts have to be published annually.

Professional accountancy bodies

ICPA
IFAC

Certification and auditing

Audit is carried out by external auditors in the company. KPMG, Pricewaterhouse Coopers, Deloitte. Ernst and Young : http://www.ey.com/Home

Accounting news

EIN Middle East accounting news.