Four Types of Property Taxes in Israel
This article addresses the four types of property taxes in Israel including arnona.
Types of Property Taxes in Israel
There are four primary types of property taxes in Israel. The first type of tax is a purchase tax (mas rechisha), which the person who purchases the property is required to pay when purchasing a residential property. The second type of tax is a capital gains tax (mas shevach), which the seller must pay for the property they sold, unless the property is residential and meets specific criteria. The third type of tax is income tax (mas hachnasa), which an individual must pay when receiving money from renters so long as the rental income exceeds a certain amount. While this amount can vary, it is approximately 5,500 NIS. The fourth type of property tax is municipal tax (arnona), which applies to buildings according to their location in municipal boundaries and based on their size in net square meters.
In this series of articles we are concerned with arnona in particular, as many clients ask us to assist them with arnona-related issues. There are discounts or exemptions in a variety of cases. The particular rate is adjusted from year to year, but the rate per square meter is generally a lower rate for properties that are smaller than 120 square meters, and higher for properties that are larger than 120 square meters. See our Arnona article series where we address numerous issues related to discounts, exemptions, rates, and more.
This Series of Articles
Our law firm has several legal foci, including real estate and property law. This includes issues dealing with Arnona, which is one of the four types of property taxes in Israel that we discuss in this article. Issues related to Arnona are under the auspices of the Israeli Ministry of Interior (Misrad HaPanim) and the local municipal authority. In order to assist our local and foreign clients with arnona-related issues as well as other property-related issues in Israel, we have written a short series of articles on Arnona.
If you have any questions about Arnona or property taxes in Israel, feel free to contact us.
Advocate Michael Decker specializes in assisting numerous local and foreign clients with Arnona issues in Israel, and he would be happy to discuss this with you.