Tel-Aviv
EY
Certified Public Accountants
144 Menachem Begin Road
Tel-Aviv 6492102 Israel
Executive contacts
Hagit Korine-Frenkel
+972 (3) 623-2733
Fax: +972 (3) 562-1467 Email: korine.hagit@il.ey.com
Yehuda Avital +972 (3) 623-2543 Fax: +972 (3) 562-1467 Email: yehuda.avital@il.ey.com
Orit Daniel +972 (52) 874-8308 Fax: +972 (3) 562-1467 Email: orit.daniel@il.ey.com
Danny Zucker +972 (3) 568-1061 Fax: +972 (3) 562-1467 Email: danny.zucker@il.ey.com
Immigration contact
Hila Ozer
A. Income tax
+972 (73) 379-9987
Fax: +972 (3) 561-5977 Email: hila.ozer@il.ey.com
Who is liable. Resident individuals are subject to tax on their worldwide income and worldwide capital gains. Nonresident individuals are subject to tax on income from Israeli sources, which is income accrued or derived in Israel.
An Israeli resident is defined as an individual whose center of living is in Israel, taking into account the person’s family, eco nomic and social links, including the following considerations:
• Permanent home
• Place of residence of the individual and his or her family
• Habitual place of business or permanent place of employment
• Place where assets and investments are located
• Place of membership in organizations, associations and institu tions
Under the law, a rebuttable presumption of Israeli residency will apply in either of the following circumstances:
• The individual is present in Israel at least 183 days in a tax year ending 31 December.
• The individual is present in Israel at least 30 days in the current tax year and a cumulative total of 425 days in the current and two preceding tax years.
If an individual is relocating for more than four years, he or she may sever residency under a “foreign resident” definition. This definition states that if during the first two years the individual is not present in Israel for more than 183 days and if the individual
does not have a center of vital interest during the next two con secutive years, the individual is considered a nonresident during these four years (from date of departure).
New Immigrants (Oleh Hadash), First Time Residents or Senior Returning Residents (who were considered nonresident for a period of at least 10 consecutive years according to domestic law) are generally classified as residents for Israeli tax purposes since the earlier of the date of repatriation of the individual or the fam ily, a stay over 183 days or the date of classification as a New Immigrant by the Israeli government. They may enjoy significant income tax, capital gains tax and import tax exemptions or benefits for a 10-year period (that is, tax exemption on foreignsource income and exemption from reporting under certain circumstances). New Immigrants and Senior Returning Residents may be considered nonresident for tax purposes during the first 12 months of their stay in Israel if a special notice form is submit ted to the Israel Tax Authority (ITA) within 90 days after arrival. It is possible to approach the ITA and obtain a certificate of New Immigrant or Senior Returning Resident through the filing an official application. Such certificate may provide the taxpayer with some assurance regarding his or her tax status and whether he or she is eligible for the associated tax benefits.
A distinctive regime is available for returning residents who spent more than six years outside Israel. The regime includes tax benefits for these individuals on their return to Israel. The ITA is currently aiming to revise the residency definition regulations. As a result, readers should obtain updated information before taking actions.
Income subject to tax
Employment income. Taxable employment income broadly covers salary and virtually all cash and in-kind benefits and allowances provided directly or indirectly to employees or for their benefit. If benefits are provided on a net-of-tax basis, they must be grossed up for tax purposes.
Company vehicles at an employee’s disposal are taxable to the employee based on their prescribed usage value. The usage value for vehicles registered on or before 31 December 2009 depends on the price group of the model shown on the vehicle registration. The usage value for vehicles registered on or after 1 January 2010 equals a certain percentage of the vehicle’s cost as defined in detailed regulations. These values are set forth in tax tables published by the tax authorities.
The use of a cell phone provided by the employer is taxable (attrib uted income of a specific amount, which is ILS105 per month during 2021).
The usage value of a car or a motorcycle provided to the employ ee for personal use is taxable (usage value calculated as a percent age of the car’s value).
Educational allowances provided by employers to their employees are taxable for income tax and national insurance purposes.
For severance payments, a portion of the granted amount by employers to employees on termination of employment relation ships is exempt from tax, regardless of whether the payments are
required by law or are voluntary. The exempt portion is the lesser of one month’s salary or ILS12,340 (as of 2021) per year of service.
Israeli employers are required to provide social benefits through externally approved provident funds. The social benefits for employees typically include some or all of the benefits shown in the following table.
Common contribution as a percentage of salary Employee Employer
Benefit
Retirement policy
Comprehensive pension plan
Long-term savings plan
Severance pay funding
Disability insurance
Educational funds (b)
%
(a) 6.5 (a)
(a) 6.5 (a)
6 to 8.33
0 to 2.5
(c) 7.5 (c)
(a) Employers’ contributions up to ILS1,978 per month are exempt from tax. Contributions exceeding this amount are taxable as employment income. (b) These funds may be used after three years for training in Israel or, after six years, for any reason. Different rules apply to 5% or greater shareholders and to self-employed individuals. These funds are not compulsory funds by law. (c) These are the maximum rates. Employers’ contributions are exempt from tax if contributions are made on monthly salary not exceeding ILS15,712 (2021). Contributions exceeding this amount are taxable as employment income.
As a result of ongoing major amendments to the law, the calculations of the above tax credits and deductions have become very complicated. Readers should seek professional advice before making decisions.
Self-employment income. Residents and nonresidents generally are subject to Israeli income tax on income derived from a business conducted in Israel and on income from one-time commercial transactions. Residents are also subject to tax on overseas income.
Self-employed individuals are subject to tax on business profits at the rates set forth in Rates.
Directors’ fees. Directors’ fees and related expenses for participat ing in board meetings are taxable as income from self-employment. A 17% value-added tax (VAT) liability also arises, but if the director derives primarily employment income, the payer company may account for the VAT under a reverse-charge mechanism. The company may recover the VAT as input VAT if it is a VAT dealer. Directors’ remuneration for other managerial duties is taxable as employment income.
For private, closely held companies (controlled by five or fewer individuals or their relatives), additional rules apply to the deductibility of payments to employee-shareholders who directly or indirectly control 10% or more of such companies.
Investment income The following tax rates apply to investment income and gains derived by individuals.
Income Rate (%)
Real (inflation adjusted) capital gains derived from publicly traded and untraded securities General rate for individuals on gains accruing from 1 January 2012 25 Individuals who were 10%-or-greater shareholders (material shareholders) in the company concerned at any time within the 12 preceding months 30 General rate for individuals on linear portion of gains accruing during the period of 1 January 2003 through 31 December 2011 20 Gains accruing to material shareholders during the period of 1 January 2003 through 31 December 2011 25 Gains accruing before 1 January 2003; old rates that apply to the time-based linear portion of the gains
Capital gains from securities that are not linked to the consumer price index or foreign currency, such as bonds, short-term government bonds and commercial paper
Up to 50
General rate 15 Material shareholders 20
Interest
On “linked” (that is, linked to the consumer price index in Israel) or foreign instruments 25 On “unlinked” Israeli instruments 15 Material shareholders
Up to 50 Dividends
General rate for individuals 25 Material shareholders 30 Paid from the profits of an approved or privileged enterprise or approved property under the Law for the Encouragement of Capital Investments, 1959 0/4/20
Others
Real Estate Investment Trust (REIT), if conditions met Up to 50 Residential rental income derived by an individual landlord from individual tenants, not exceeding ILS5,070 per month (any excess reduces the exemption by the amount of the excess)
Exempt up to ceiling
Double tax relief provisions may apply in certain cases (see Section E).
Taxation of employee share option plans and share purchase plans. Detailed rules apply to employee share option plans and share purchase plans. Capital gains tax treatment is allowed for certain
qualified plans called Qualified Section 102 Capital Gain Plans, which are administered by a trustee, if, for options granted on or after 1 January 2006, at least two years have elapsed since the options were granted. Options granted according to the capital gains alternative (see below) before 1 January 2006 are subject to a minimum holding period of 24 months as of the end of the year in which the options were granted or 30 months from the grant date, depending on the election of the employee. Gains derived from nonqualified plans are treated as an ordinary income subject to income tax (up to 50%) and social security tax (12% tax up to a certain cap).
The tax authorities must approve the trustee and receive notice concerning a Section 102 beneficial plan at least 30 days before the implementation of the plan. Individuals who move to another country to work or reside may request tax rulings from the tax authorities to mitigate uncertainty or address double taxation or tax withholding.
Employers may choose between alternative rules for dividing gains between salary income (the employer deducts an option expense and the employee is subject to income tax at rates of up to 50% plus social security; see Section C) and capital gains (the employer receives no deduction and the employee is subject to capital gains tax at a rate of 25%).
Restricted Stock Units (RSU) plans may be qualified in the same manner as Section 102 beneficial plans by filing an application with the ITA and depositing the stock units in the hands of a qualified trustee for a period of at least two years.
Capital gains and losses. Residents and nonresidents are generally subject to Israeli tax on their capital gains relating directly or indirectly to assets in Israel, including Israeli securities, and to rights related to such assets. In certain circumstances, nonresi dents are exempt from tax on a sale of securities of an Israeli entity or a foreign entity if most of the entity’s assets are rights (directly or indirectly) in assets located in Israel. Under a relevant tax treaty, a resident of the other tax treaty country may be exempt from Israeli tax on capital gains, except for gains derived from transfers of real estate interests or business assets in Israel and transfers by material shareholders. Special rules apply to pub licly traded securities (see below). Resident individuals are also subject to capital gains tax on their capital gains derived abroad.
Exit tax. Persons who cease to be Israeli residents are generally liable for capital gains tax as if they sold their assets one day before they ceased to be residents. The tax is payable on departure or on sale of the assets concerned (including shares and options) based on the linear portion of the gain related to the portion of the holding period during which the person was con sidered an Israeli resident.
Calculation of taxable amount. Capital gains are divided into real and inflationary components. In general, real gains derived before 31 December 2002 are taxed at the regular personal tax rates (30% to 50%). However, real gains derived from foreign publicly traded securities before 31 December 2004 are generally taxed at a rate of 35%. Any capital gains derived after these dates until
2011 are taxed at a rate of 20%; after 2011, the rate was updated to 25% (or 30% if the person is a 10% or greater shareholder [material shareholder]). In certain circumstances, the inflationary component is exempt from tax.
Capital losses may be used to offset capital gains derived in the same tax year or in subsequent tax years. In some cases, they may be offset against interest or dividends from securities if the losses are derived in the same tax year.
Detailed rules relate to deferrals of capital gains tax in certain cases, including mergers, divisions and shares-for-assets exchanges.
Gains attributable to securities Israeli residents are taxed at a rate of 25% on the real (inflation adjusted) gains derived from sales of traded securities in Israel and abroad, or 15% on the nominal gain on the sale of certain bonds not linked to the consumer price index or a foreign currency (see above). A tax rate of 30% is applied if the individual claimed real interest deductions.
Gains derived from sales of bonds issued by a foreign country or foreign mutual funds are subject to tax at the rate of 25% (or 30% if a material shareholder). Nonresidents are exempt from Israeli tax on capital gains derived on the Tel-Aviv stock exchange or on Israeli securities on an overseas exchange. However, if an Israeli resident owns at least 25% of a nonresident investor company, such exemption does not apply.
Gains attributable to real estate Gains derived from sales of Israeli real estate or from sales of interests in real estate entities (entities whose primary assets relate to Israeli real estate) are subject to land appreciation tax at the regular rates of up to 50% for the portion of the gain that relates to the period before 7 November 2001. For the linear portion that relates to the period after that date, the applicable rate is 25% from 2007, with the exception of material shareholders who are taxed at a rate of 30%. Assets acquired in 2002 are eligible for a tax rebate of 20%. Assets acquired in 2003 are eligible for a 10% rebate. Various exemptions apply to residential homes. Also, see Real estate tax in Section B.
In addition, the purchaser of real estate must pay transfer fees (acquisition tax) at various rates ranging from 0% to 10%. For an interest acquired in a real estate entity, acquisition tax is imposed on the underlying real estate asset value without offsetting liabil ities or borrowings.
Deductions
Deductible expenses
Business-related expenses incurred by em ployees are deductible only in limited circumstances. For example, expenses incurred to update existing professional knowledge are deductible. However, to claim these deductions, employees generally must file annual personal Israeli tax returns, even if they are otherwise exempt from filing.
To complement the tax deductions available to employees for education, only self-employed individuals may deduct payments made to approved education funds that are used for training or education in Israel (or for any purpose after six years). The amount of the payment that may be deducted is limited to up to
4.5% of the taxable income. The annual income limit for 2021 is ILS188,544 (ILS263,000 for self-employed individuals). This limit is adjusted annually.
Personal deductions. In general, tax relief for individuals is in the form of tax credits rather than tax deductions. Consequently, relatively few items are deductible for tax purposes.
As a result of major amendments to the law, the calculation of personal deductions has become complicated. Readers should seek professional advice before making decisions.
Business deductions. Expenses are generally deductible if they are incurred wholly and exclusively in the production of taxable income. Additional rules apply to certain items, including car expenses, travel, entertainment, and research and development. The cash basis is acceptable for certain small businesses, and spe cial inflation-adjustment rules are prescribed for businesses. These adjustments include inflation relief relating to depreciation for certain small businesses.
Special rules for expatriates. If no treaty exemption applies, expa triate nonresidents working in Israel lawfully for an employer may enjoy certain benefits. For the first 12 months in Israel, a “foreign expert” is entitled to a deduction for accommodation expenses incurred and a living expense deduction of up to ILS330 (2021) per day. To be considered a “foreign expert” under the Israeli income tax regulations, the assignee needs to meet the following criteria:
• He or she is legally allowed to work in Israel.
• He or she is working in his or her field of expertise and was invited to work in Israel by a local entity.
• He or she earns a gross salary exceeding ILS13,400 (2021) per month.
Foreign journalists who are members of the Foreign Press Association in Israel and foreign athletes are entitled to a tax rate of 25% and the abovementioned expatriate deductions for the first 36 months of work in Israel for foreign journalists and the first 48 months of work for foreign athletes.
An employer levy at a rate of 20% (or 0% or 15%, depending on the employee’s field of employment; the exemption applies for the agriculture field) is imposed on foreign employees’ employment income unless the employees are journalists or athletes or unless the employment income exceeds twice the average salary, which equals ILS21,102 (as of January 2021) per month. The levy must be paid by the employer and is not deducted from the employment income.
Rates. The Israeli tax year is the calendar year. In principle, Israeli personal tax liability is computed annually. However, tax is typi cally withheld from salaries and reported each month. Monthly tax brackets used during a year for payroll and other purposes are updated annually for inflation and are totaled to produce the
annual tax brackets. The following table presents the annual tax able income brackets for 2021.
Taxable income Tax rate* Tax due Cumulative tax due ILS % ILS ILS
First 75,480 10 7,548 7,548
Next 32,880 14 4,603 12,151
Next 65,520 20 13,104 25,255
Next 67,800 31 21,018 46,273
Next 261,240 35 91,434 137,707
Next 144,720 47 68,018 205,725 Above 647,640 50
* These tax rates are restricted to income earned from employment and selfemployment and to income derived by persons over 60 years of age. In other cases, a minimum tax rate of 31% applies to the first ILS241,680, a tax rate of 35% applies to income between ILS241,681 and ILS502,920, a tax rate of 47% applies to income between ILS502,921 and ILS647,640, and a tax rate of 50% applies to income above ILS647,640.
Credits. Israeli resident individuals are entitled to personal tax credits, which are known as credit points. These credit points are deducted from the computed income tax liability of individuals. Each credit point is currently worth ILS218 (2021) per month.
The number of credit points granted to an individual reflects family circumstances. For example, an unmarried male resident generally receives 2.25 credit points, and an unmarried female resident generally receives 2.75 credit points. If, for example, both spouses work and opt for separate tax computations, the male receives 2.25 credit points and the female/spouse receives 2.75 points; the female/spouse also generally receives one credit point for each child under 18 years of age and one-half of a credit point for a child born or reaching 18 in the tax year. Effective from 2012, the male spouse is also eligible for certain credit points for infants up to the age of five years.
The following are other significant tax credits granted to individuals:
• Credits with respect to savings fund contributions (see Income subject to tax).
• Tax credit for 35% of charitable contributions to recognized institutions if a taxpayer’s annual contributions exceed ILS190. However, no credit is given for annual contributions exceeding 30% of taxable income or ILS9,294,000, whichever is lower.
• Additional credits in various other cases, including new immigrants, returning residents, one-parent families, divorcées, graduates of a higher education institute and residents living and working in various priority areas.
Relief for losses. In general, business losses may be offset against income from any source derived in the same tax year, including salary income. Unrelieved business losses may be carried forward for an unlimited number of years to offset business income or capital gains derived from business activities (see Capital gains and losses).
B. Other taxes
Net worth tax. Net worth tax is not levied in Israel.
Estate and gift taxes. Israel does not impose taxes on inheri tances or bona fide gifts. For transfers by inheritance or by gift of assets that would normally be subject to capital gains tax or land appreciation tax, the recipient’s tax cost base and date of purchase are generally deemed to be the same as those for the trans feror of the property.
Real estate tax. In general, sellers of real estate assets are subject to land appreciation tax on capital gains at a rate of 25% on any appreciation, based on the linear portion, before 7 November 2001, at a rate of 20% on any appreciation after that date until 31 December 2011, and at a rate of 25% after that date, with cer tain exceptions, including exemption provisions for homes owned by an individual.
Purchasers of real estate interests in Israel pay an acquisition tax at rates ranging from 0% to 10%.
C. Social security Contributions. National insurance contributions are generally pay able on taxable income as calculated for income tax purposes. The table below sets out the rates of national insurance contributions. For residents, these rates include a supplementary health levy. Foreign residents generally arrange comprehensive private health care.
Contribution as percentage of income (2021) Nonworking
Self- passive employed income persons recipients
Employer Employee (a) (a) Category % % % %
Israeli residents (b) Monthly income up to ILS6,331 3.55 3.5 5.97 9.61 Monthly income from ILS6,331 to ILS44,020 7.60 12 17.83 12
Nonresidents Monthly income up to ILS6,331 0.59 0.04 Monthly income from ILS6,331 to ILS44,020 2.65 0.87
Nonresidents from a social security treaty country Monthly income up to ILS6,331 3.55 0.4 Monthly income from ILS6,331 to ILS44,020 7.6 7
(a) Fifty-two percent of social security contributions paid during a tax year on unemployment income is deductible for income tax purposes during the year of payment.
(b) Lower contributions may apply to Israeli residents who work abroad as selfemployed persons for continuous periods exceeding six months or for non resident employers, unless they were hired in Israel.
Totalization agreements. Israel has entered into social security totalization agreements with the following jurisdictions.
Austria Finland Russian Belgium France Federation
Bulgaria Germany Slovak Republic
Canada Italy Sweden (limited) Netherlands Switzerland
Czech Republic Norway United Kingdom Denmark Romania Uruguay
D. Tax filing and payment procedures
In principle, Israeli and foreign employers with personnel in Israel must maintain an Israeli payroll withholding tax file. Income tax and national insurance contributions relating to monthly employment income and benefits must generally be reported and remitted by the 15th day of each following month. Various other monthly or bimonthly filings may also be required from the employer, including company tax advances determined by the tax authorities and supplementary company tax advances of 45% for nondeductible expenses incurred, including car maintenance and depreciation, travel and entertainment.
Capital transactions. Capital gains transactions generally are reportable within 30 days after the transaction date. Land appre ciation tax transactions are generally reportable within 30 days. Tax must be settled or paid on account within 60 days.
Annual tax returns. A general obligation to file an annual tax return exists. Nevertheless, as a result of the withholding tax system, individuals may be exempt from filing annual personal tax returns in Israel. If income was not fully and correctly withheld at source, a return should be filed to reflect full salary, income and benefits in kind.
Resident individuals over 18 years of age at the beginning of the tax year are required to file a personal income tax return. However, an exemption from filing may apply if all of the follow ing conditions are satisfied:
• The salary does not exceed the annual ceiling of ILS649,000 per individual.
• Interest in Israel does not exceed the annual ceiling of ILS643,000.
• The amount of each type of other income (rent and foreign income) earned by the individual is less than ILS337,000 for each type of income.
Notwithstanding the above, the following individuals must file annual income tax returns:
• Ten percent or greater shareholders
• Spouses who work together
• Individuals (or their spouses) who receive severance pay or a commuted pension allowed to be spread over several tax years
• Trust settlors for the year in which they settle the trust
• Recipients of a distribution or other transfer of assets from a trust
• Professional athletes and their spouses
• Individuals (or their spouses or children) who had either a law ful right in a non-publicly traded foreign company or other foreign assets worth more than ILS1,872,000 at any time during the tax year or a foreign bank account with a balance exceeding ILS1,872,000 at any time during the tax year
• Individuals required to file returns for the previous year, unless a specific exemption is granted
• Any other person or entity instructed to file a return by a tax assessor
Individuals must also pay half-year advances for capital gains, which must also be reported, if the full amount of the tax was not withheld at source. The payments and reports are due on 31 January and 31 July.
Online filing. Online filing is required for those who have to file a tax return. Failure to file an online tax return by the due date results in a penalty of ILS500 for each full month of delay.
As of the 2017 tax year, Israeli individuals who do not meet the numerical presumptions mentioned above and would like to claim severance of Israeli residency are required to file a return and fill out a residency declaration as an appendix to the return.
Due dates for tax returns. For those who do not have to file an online tax return, the due date is 30 April following the year-end. Taxpayers who are required to file an online tax return must file it by 31 May following the year-end. The tax authorities may grant filing extensions. Individuals represented by an Israeli certified public accountant (CPA) may receive an automatic extension based on the number of tax returns that the CPA must file with the tax authorities. As a result of the COVID-19 pan demic, extensions for filing are available. A tax professional should be consulted regarding the changes.
Assessment. The Israeli tax system is based on the principle of self-assessment. An annual tax return must be accompanied by payment of any balance of tax due computed by the taxpayer for the relevant tax year.
Married persons. Married persons, or the tax assessor, may elect one spouse to be the registered spouse in whose name the couple is assessed. For the election to be binding, the registered spouse’s income should be at least 25% of the other spouse’s income in the year before the election and in the next five years. If the couple does not elect otherwise, the tax assessor nominates the spouse with the higher taxable income over the two years preceding the assessment as the registered taxpayer. Joint tax computa tions are allowed. However, if the spouses derive employment or self-employment income from unrelated sources, many couples may benefit by opting to compute tax separately on the second spouse’s income.
E. Double tax relief and tax treaties
Unilateral relief. If no double tax treaty applies, Israeli residents may claim relief from double taxation (foreign tax credit) on foreign-source income.
Under Israeli domestic law or applicable tax treaties, foreign cap ital gains tax on dispositions of foreign assets may be credited by Israeli residents against Israeli capital gains tax on such disposi tions. Any excess foreign tax credit may be carried forward for up to five tax years.
Foreign residents who receive little or no relief for Israeli taxes in their home countries may be granted a reduced Israeli tax rate by the Minister of Finance. In practice, the reduced rate is usually at least 25% and applies to capital gains only.
Tax treaties. Israel has entered into double tax treaties with the following jurisdictions.
Armenia Hungary Romania
Australia India Russian
Austria Ireland Federation Azerbaijan Italy Serbia
Belarus Jamaica Singapore Belgium Japan Slovak Republic
Brazil Korea (South) Slovenia Bulgaria Latvia South Africa Canada Lithuania Spain China Mainland Luxembourg Sweden Croatia Malta Switzerland
Czech Republic Mexico Taiwan Denmark Moldova Thailand Estonia Netherlands Turkey Ethiopia North Macedonia Ukraine Finland Norway United Arab Emirates France Panama United Kingdom Georgia Philippines United States Germany Poland Uzbekistan Greece Portugal Vietnam
Israel is negotiating tax treaties with several jurisdictions.
F. Visitor visas for tourism or business purposes
All foreign nationals, except those from waiver jurisdictions that do not require entry visas, must obtain valid entry visas to enter Israel. Citizens of certain waiver jurisdictions may obtain visas at the port of entry. Foreign nationals may enter Israel under visitor visas, temporary residence visas or permanent residence visas.
Visitor visas are divided into the following categories:
• B1: For foreign nationals who wish to work in Israel on a tem porary basis.
• B2: For foreign nationals who wish to visit Israel, typically for tourism or business purposes.
• B3: For foreign nationals whose entry status is not clear. This visa is of limited duration (one month) until the entry status is clarified and the entry visa is reclassified. The duty of reclassifying the entry status rests on the foreign national granted the B3 visitor visa.
• B4: For foreign nationals who wish to volunteer (work without earnings) in Israel.
Israel has visa exemption agreements with many jurisdictions. Tourist visa exemption applies to national and official passports only, and not to other travel documents. Citizens of the following jurisdictions are exempt from obtaining transit and class B2 visi tor visas.
Albania Greece
Palau
Andorra Grenada Panama Argentina Guatemala Papua New Australia Haiti Guinea
Austria Honduras Paraguay
Bahamas Hong Kong Peru
Barbados Hungary Philippines
Belarus Iceland Poland Belgium Ireland Portugal
Belize Isle of Man and Romania
Botswana the Channel Islands Russian
Brazil Italy Federation Bulgaria Jamaica St. Kitts and Nevis
Canada Japan St. Lucia
Central African Korea (South) St. Vincent and Republic Latvia the Grenadines
Chile Lesotho San Marino Colombia Liechtenstein Serbia
Cook Islands Lithuania Singapore
Costa Rica Luxembourg Slovak Republic
Croatia Macau Slovenia
Cyprus Malawi Solomon Islands
Czech Malta South Africa Republic Mauritius Spain Denmark Mexico Suriname
Dominica Micronesia Sweden Dominican Moldova* Switzerland Republic Monaco Taiwan Ecuador Mongolia Tonga
El Salvador Montenegro Trinidad and Estonia Nauru Tobago Fiji Netherlands Ukraine Finland New Zealand United Kingdom
France Niue United States
Georgia North Macedonia Uruguay Germany Norway Vanuatu
* The exemption applies only to citizens of Moldova who hold biometric pass ports.
In general, all visitor visas, with the exception of B1 and B3 type visas, are valid between 30 and 90 days and may be renewed up to 180 days.
The application takes place at an Israeli consulate or at the local Ministry of Interior.
Each jurisdiction has a unique filing procedure for obtaining a visitor visa.
Both B1 and B4 class visas may be applied for by the employer. A B1 visa may be renewed annually for up to 63 months. A B1 visa may be extended beyond 63 months under very limited cir cumstances.
Indian and Chinese nationals, under certain circumstances, may be eligible for a B2 visitor visa for business purposes for five years or one year, respectively, if each visit will not exceed 90 days in Israel.
For the period of the COVID-19 pandemic, new immigration restrictions were introduced regarding the entrance of foreign nationals to Israel. Therefore, individuals should consult in advance before making any arrangements to arrive.
G. Work permits
A foreign national may work in Israel only if he or she enters the country with a permanent residence visa or a temporary resi dence visa or holds a B1 or B4 visa.
An applicant and his or her employer can apply for a work permit valid for 2 years, 1 year, 90 days or 45 days. An applicant and his or her employer must file certain items to obtain a work permit and a B1 work visa. The B1 work visa is always issued for a maximum period of one year and may be renewed annually, assuming that the employer and employee comply with the terms of the work permit.
The following are examples of the items that must be filed (other forms or submissions may be required):
• Employee’s certificate of valid medical insurance.
• Salary letter with verification of the expert’s salary threshold (twice the average monthly salary in the Israeli market, ILS20,856; amount is subject to annual changes). This salary amount should be met and/or exceeded to avoid the 20% for eign expert levy.
• Evidence of expertise held by the employee, such as academic degree, diploma and training.
• An employer’s undertaking that assures the employee’s depar ture on termination of the employment contract.
• The employee’s accurate personal data, including his or her passport number, curriculum vitae (CV), diploma, police clear ance and medical checks.
• Letter from an Israeli employer or other Israeli party, explaining the reasons why the employee’s presence is needed.
• Affidavit on a specified form concerning the above items.
The following can apply for a B1 visa:
• An Israeli-based employer
• A foreign employer that has business ties or has entered into a service agreement with an Israeli-based entity
Detailed rules apply to employers and employees regarding, among other matters, pre-arrival medical examinations, as well as housing and medical care. As of January 2021, the amount of government registration fees for a work permit and B1 work visa application (per principal applicant for one year) is ILS11,150.
For the B1 work visa for non-academic experts, the regulations distinguish between experts whose work activities require aca demic certification and experts whose work activities do not require academic certification. Requirements for experts whose work activities do not require academic certification, include,
among others, payment of the expert’s salary to a bank account in Israel and providing proof of salary payments.
B1 visas for 90 days can be utilized continuously or intermit tently in the same calendar year, provided that the total number of days in a calendar year does not exceed 90 days. Each visit to Israel will require a new work permit and visa application and a consular process for the applicant to follow in the overseas Israeli consulate. Multiple applications submitted under this visa type, to utilize remaining days, is at the sole discretion of the Israeli immigration authorities. The salary requirement for the B1 visa for 90 days is currently ILS5,300 (subject to annual adjustment), which represents the minimum wage in Israel.
In addition, an alternative option exists for employees who arrive in Israel for a work purpose for a time period not exceeding 45 days. Under this option, the foreign expert can stay and work in Israel for up to 45 days in a calendar year, continuously or inter mittently. The counting of the days starts with the first day of arrival in Israel. The procedure is only available for citizens from visa-exempt jurisdictions (see Section F). It applies only to for eign experts who are needed in Israel to perform a temporary expertise assignment, such as advising, supervising, repairing equipment, training or making presentations.
The B1 High Tech work visa allows Israeli companies, which are recognized as “High-Tech Companies” for immigration purposes, to employ foreign experts. This visa is valid for up to 12 months with a possibility for renewal, and offers a streamlined visa process. The expert’s salary threshold mentioned above applies. Spouses of the primary visa applicant are granted a B1 work visa and are able to work for an employer of their choice while the visa is valid.
H. Residence visas
Temporary residence visas are divided into the following cate gories:
• A1: For Jewish foreign nationals only who wish to obtain Israeli citizenship and are eligible under the Law of Return. The A1 class visa is valid for one year and may be renewed twice, for a total of five years.
• A2: For foreign nationals who wish to study in Israel.
• A3: For members of the clergy who are invited to Israel by a religious institute. The institute must apply for the visa.
• A4: For the spouse or children (under 18 years of age) of an A2 or A3 class visa holder.
• A5: For foreign nationals wishing to stay in Israel for any rea son other than those listed above.
Unless the individual is staying in Israel for the reasons mentioned in categories A1 to A4 above, a permanent residence visa is granted for an unlimited duration of stay. Applications are consid ered by the Ministry of the Interior on a case-by-case basis. An application may be filed after several years of temporary resi dence.
I. Family and personal considerations
Family members. In certain circumstances, a B2 visa may be granted to the spouse and dependent children of a foreign nation al who receives a B1 visa. In these cases, the duration of the B2 visa corresponds to that of the B1 visa.
Common law partners. No official regulation specifies the requirements for spouse status. Each case needs to be examined separately. However, proof of the sincerity of the relationship must be supported by documents, including, among others, an affidavit from an attorney declaring that the couple is living together and joint bank account documents.
Driver’s permits. Foreign visitors who hold valid foreign or inter national driver’s licenses may drive a car legally in Israel for up to 12 months per visit to Israel. If a visit exceeds 12 months, the visitor must pass a short vehicle control test and receive an Israeli driver’s license. Different rules apply to commercial vehicles.