{"id":1093,"date":"2015-09-30T09:38:36","date_gmt":"2015-09-30T09:38:36","guid":{"rendered":"http:\/\/hcat.co\/?p=1093"},"modified":"2015-09-30T09:38:36","modified_gmt":"2015-09-30T09:38:36","slug":"your-taxes-busy-week-for-real-estate-and-trusts","status":"publish","type":"post","link":"https:\/\/hcat.co\/your-taxes-busy-week-for-real-estate-and-trusts\/","title":{"rendered":"Your Taxes: Busy Week for Real Estate and Trusts"},"content":{"rendered":"<p><strong>Leon Harris<\/strong><\/p>\n<p>It&#8217;s been a busy week in the tax world. Greece is teetering on the brink of default caused in part by a dislike of paying Greek taxes.<\/p>\n<p>On this side of the Mediterranean, the Israeli government seems keen to sort out gas production problems. That will mean more energy for Israelis and allow the government to tax gas profits for many years to come, once an investment payback formula is satisfied.<\/p>\n<p><strong>Real Estate<\/strong><\/p>\n<p>On <span data-term=\"goog_1554415317\">June 24<\/span>, the Knesset passed an amendment which increased acquisition tax on Israeli home with immediate effect. This came as a big surprise as changes were expected only a week later on <span data-term=\"goog_1554415318\">July 1<\/span>. The main change is an increase in the acquisition tax on homes in Israel which are not the only home owned by the purchaser, from 5%-7% to the following rates:<\/p>\n<ul>\n<li>8% on the first NIS 4,800,605<\/li>\n<li>10% above this value.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>Previously, these rates stood at 5% &#8211; 7%.<\/p>\n<p>Also, the Knesset took the opportunity to fix some typos in the law regarding acquisition tax on only homes in Israel. Unfortunately, other typos apparently remain in the ITA&#8217;s website \u2013 we hope they will be fixed soon. Subject to this, it seems that home purchasers can expect the following acquisition tax rates if applicable conditions are met:<\/p>\n<ul>\n<li>0% on the first NIS 1,568,000<\/li>\n<li>3.5% on the next slice to NIS 1,860,790<\/li>\n<li>5% on the next slice to NIS 4,800,605<\/li>\n<li>8% on the next slice to NIS 16,002,015<\/li>\n<li>10% above that<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>As for Olim who buy a home from one year before their Aliya to seven years after it, the acquisition tax rates are expected to be:<\/p>\n<ul>\n<li>0.5% on the first NIS 1,700,220<\/li>\n<li>5% above that.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>Comment: It remains to be seen if these changes will take the edge of house price inflation.<\/p>\n<p><strong>Trusts:<\/strong><\/p>\n<p>On <span data-term=\"goog_1554415319\">June 29<\/span>, the Israeli Tax Authority \u00a0again extended the deadlines for certain trusts, this time <span data-term=\"goog_1554415320\">December 31, 2015<\/span>. The deadlines were due to expire a day later on <span data-term=\"goog_1554415321\">June 30<\/span>.<\/p>\n<p>&nbsp;<\/p>\n<p>This applies to:<\/p>\n<p>&nbsp;<\/p>\n<p>First, transitional &#8220;amnesty&#8221; arrangements &#8211; for the years 2006-2013 &#8211; for &#8220;foreign resident settlor trusts&#8221;. \u00a0This procedure is intended is to resolve doubts about beneficiary &#8220;control or influence&#8221; and\/or to get a step-up of the trust assets to their market value at the end of 2013. If the amnesty is elected, there is a choice between 6% of trust capital or regular income tax on trust income in 2006-2013 discounted by 1\/3 or more sometimes.<\/p>\n<p>&nbsp;<\/p>\n<p>Second, Relatives&#8217; Trusts &#8211; for 2014 onwards &#8211; notification and choice between Israeli tax of 25% of income when derived, or 30% on income when distributed;<\/p>\n<p>&nbsp;<\/p>\n<p>Although the time extension gives more time, we still recommend that action be taken soon given the summer vacations, High Holy Days and December holidays&#8230;.<\/p>\n<p>&nbsp;<\/p>\n<p><em>The writer is a certified public accountant and tax specialist at Harris Consulting &amp; Tax Ltd.<\/em><\/p>\n<p><em>As always, consult experienced tax advisors in each country at an early stage in specific cases.<\/em><\/p>\n<div class=\"my-newsletter\" style=\"border-top:1px solid #ebebeb\"><div class=\"my-inner-newsletter\" style=\"margin: 30px auto;\"><span style=\"font-size:30px;\">Join Our Newsletter<\/span><\/div><\/div> <script>(function() {\n\twindow.mc4wp = window.mc4wp || {\n\t\tlisteners: [],\n\t\tforms: {\n\t\t\ton: function(evt, cb) {\n\t\t\t\twindow.mc4wp.listeners.push(\n\t\t\t\t\t{\n\t\t\t\t\t\tevent   : evt,\n\t\t\t\t\t\tcallback: cb\n\t\t\t\t\t}\n\t\t\t\t);\n\t\t\t}\n\t\t}\n\t}\n})();\n<\/script><!-- Mailchimp for WordPress v4.8.7 - https:\/\/wordpress.org\/plugins\/mailchimp-for-wp\/ --><form id=\"mc4wp-form-1\" class=\"mc4wp-form mc4wp-form-1722\" method=\"post\" data-id=\"1722\" data-name=\"H2CAT - Form\" ><div class=\"mc4wp-form-fields\"><div class=\"my-newsletter\">\r\n  <div class=\"my-inner-newsletter\">\r\n       <p>\r\n          <span>Your name\r\n              <input type=\"text\" name=\"FNAME\" placeholder=\"Your name\"\r\n    required=\"\">\r\n          <\/span>\r\n\t      <span>Email address: \r\n\t\t      <input type=\"email\" name=\"EMAIL\" placeholder=\"Your email address\" required \/>\r\n          <\/span>\r\n          <span>\r\n\t          <input type=\"submit\" value=\"Sign up\" \/>\r\n          <\/span>\r\n       <\/p>\r\n  <\/div>\r\n<\/div><\/div><label style=\"display: none !important;\">Leave this field empty if you're human: <input type=\"text\" name=\"_mc4wp_honeypot\" value=\"\" tabindex=\"-1\" autocomplete=\"off\" \/><\/label><input type=\"hidden\" name=\"_mc4wp_timestamp\" value=\"1714341439\" \/><input type=\"hidden\" name=\"_mc4wp_form_id\" value=\"1722\" \/><input type=\"hidden\" name=\"_mc4wp_form_element_id\" value=\"mc4wp-form-1\" \/><div class=\"mc4wp-response\"><\/div><\/form><!-- \/ Mailchimp for WordPress Plugin -->","protected":false},"excerpt":{"rendered":"<p>Leon Harris It&#8217;s been a busy week in the tax world. Greece is teetering on the brink of default caused in part by a dislike of paying Greek taxes. On this side of the Mediterranean, the Israeli government seems keen to sort out gas production problems. That will mean more energy for Israelis and allow [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[12,7],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v19.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Your Taxes: Busy Week for Real Estate and Trusts - Harris Consulting @ Tax Ltd<\/title>\n<meta name=\"description\" content=\"We are an accountancy firm with over 20 years\u2019 experience in the area of accountancy, business and financial consulting, international taxation and estate\/trust planning. We are based in Ramat Gan, Israel. 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