The Israel Tax Authority reports that it has revised the brackets for purchase tax on residential real estate according to the increase in the Consumer Price Index. The tax-exempt threshold has been raised from NIS 1,696,750 to NIS 1,744,505. If the taxpayer owns another home, 8% tax was levied on the value in excess of NIS 5,194,225 in 2019 and in excess of NIS 5,340,425 in 2020.
As a result of the changes, purchasers of homes who do not own additional homes will be assessed as follows: zero tax up to a value of NIS 1,744,505, 3.5% on value between NIS 1,744,505 and NIS 2,069,205, 5% on value between NIS 2,069,205 and NIS 5,338,290, 8% on value between NIS 5,338,290 and NIS 17,794,305, and 10% on value above NIS 17,794,305.
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Purchasers of a home who own an additional home will be assessed 8% tax on value up to NIS 5,340,425 and 10% tax on value over NIS 5,340,425. For example, a person purchasing a single home for NIS 2.2 million will be assessed NIS 17,905 in tax, and a person purchasing an additional home for NIS 6 million will be assessed NIS 493,192 in tax.
There are a number of online calculators for calculating the purchase tax, but the reliability and updating to the new brackets of these websites should be verified.
Published by Globes, Israel business news – en.globes.co.il – on January 19, 2020
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