From Globes Real Estate
Accounting firm Baker Tilly reports that Israelis pay lower taxes on real estate deals compared with other countries.
The taxes examined are purchase tax paid on purchase of a property, tax on rental (by maximum tax bracket), and capital gains tax on the sale of a property. Israel was compared with Canada, Australia, Spain, Russia, the US, France and Japan.
Landlords can draw encouragement from the fact that Israel has the lowest tax of any country examined. Israel is somewhere in the middle on capital gains tax; tax rates (on second hand apartments) are higher than in Spain, the US and France but lower than the tax paid on the same apartment in Canada, Australia, Russia and Japan.
Baker Tilly Israel partner and tax manager Guy Reshtick said, “Tax in Israel is not as high as people think. Taxes are high in Israel but in matters relating to real estate tax, our situation is improving. There have been changes over the years that have lowered the sums required from apartment sellers and buyers. For example, betterment tax that in the past amounted to 50% of capital gains fell to 20% a decade ago – and that is a direct profit for apartment sellers.”
He added, “And here too apartment sellers are given a complete exemption from betterment tax on the sale of an apartment once in every four years.
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