Israel Taxes 2012, Shpilberg CPAs Firm -Israeli CPA Accountant

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Updates:

July 1, 2009:
Our accounting firm moved to new premises at Shekel Towers, 168 Jabotinski st. Bnei-Brak.

December 20, 2008:
The new website of Shpilberg CPA is in the Internet

Israel Taxes 2018

The new corporate income tax rate in Israel for 2018 is 23% compared to 24% in 2017.
Companies defined as preferred companies pay 7.5%/16% while preferred technology companies pay 7.5%/12%.
The lower rates apply when the companies are located in area "A".
Personal income tax rates in 2018 range from 10% to 47%.
The V.A.T. rate in 2018 is 17%.

Israel Annual Income Tax Rates for Individuals (2018)

Tax % Income (IS)
10% 1-74,880
14% 74,881-107,400
20% 107,401-172,320
31% 172,521-239,520
35% 239,521-498,360
47% 498,361 and over

Note :The annual tax rates for passive income, e.g. business rental, are:

Tax % Income (IS)
31% 1-239,520
35% 239,521-498,360
47% 498,361 and over

Note: There is an additional 3% surtax for annual income exceeding IS 641,880.


Israel Capital Gains

Capital gains of companies is taxed at the regular 23% tax rate.
For individuals sale of assets other than shares bought after 1.1.2012 is taxed at 25%.
Sale of shares is taxed at 25% or 30% when the seller has control of 10% or more in the company.

Dividend income received by individuals is taxed at 25% /30% as in the case of sale of shares .


Israel Tax Withholding Rates

The tax withholding rates for payment to non-resident companies are:
Dividend – 4%/15%/20%/25%/30%
Royalties – 23%
Interest – 23%
Note: withholding rate are subject to double tax treaties between Israel and other countries.


Israel Social Security

Social security in Israel is paid up to a monthly ceiling of IS 43,370.
The social security rate are:
Employer – 6.86%
Employee – 9.86%
Self employed pay 5.97%-17.83%.


Israel Value Added Tax

The standard VAT rate in 2018 is 17%.

The reporting period is monthly/bi- monthly depending on the annual turnover.
VAT has to be paid up to 15 days following the reporting period.

In case of annual turnover of less than IS 98,707 businesses can in many cases register as "exempt dealers" with the VAT office.

An exempt dealer does not pay VAT on the business's income and is not allowed to deduct input VAT on expenses.


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