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Israel Taxes 2013 (March 2013)

The new corporate income tax rate in Israel for 2013 is 25%, same as in 2012.
Personal income tax rates in 2013 range from 10% to 50% compared to 10%-48% in 2012.The V.A.T. rate in 2013 remains at 17% ,same as in 2012.

Israel Annual Income Tax Rates for Individuals (2013)

Tax %	Income (IS)
10%	1-63,360
14%	63,361-108,120
21%	108,121-168,000
31%	168,001-240,000
34%	240,001-501,960
48%	501,961 -811,560
50%	811,561 and over

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

Tax %	Income (IS)
31%	1-240,000
34%	240,001-501,960
48%	501,811,560
50%	811,561 and over

Israel Capital Gains

Capital gains of companies is taxed at the regular 25% 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-residents are:
Dividend – 25%
Royalties – 25%
Interest – 15%/20%/25%
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 42,435.
The social security rate are:
Employer – 6.5%
Employee – 12.0%

Israel Value Added Tax

The standard VAT rate in 2013 is17%.

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 76,884 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.