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Each case is different, but we explain everything in this article...
During the first 10 years of your aliyah
First of all, you should know that during the first 10 years of your Aliyah, the sale of an apartment in France is considered passive income. This means that you do not have to file a declaration in Israel, and therefore no tax payable either.
After 10 years...
After 10 years, the situation is different. The sale of an apartment in this case is considered a capital gain, and you must declare the capital gain on this sale.
How is this capital gain calculated? You benefit from a linear calculation based on the number of years you have owned the apartment.
In addition, it should be noted that only the portion beyond 10 years is taxable in Israel.
At what tax rate?
The answer is simple: 25% (on the taxable portion).
Can deductions be made?
Yesin part. In accordance with the tax treaty between France and Israel, tax paid in France is fully deductible.
On the other hand, social security contributions are not considered a tax credit. They are deductible as an expense.
What are the risks of not declaring?
You should be aware that failure to declare your income in Israel is an offence punishable by law. The consequences can be dramatic, and we strongly advise against taking this route.
How long does it take to declare a sale?
There is a time limit: generally, within during the fiscal year of sale. An annual tax return must be submitted to the tax authorities.
In conclusion...
As you can see, sometimes waiting a few months or years can make a property that wasn't taxable taxable.
We therefore advise you to sell during the first 10 years of your aliyah to benefit from the exemption..
As each case is different, we advise you to consult a professional if you have any questions.
If you need support for your tax return to the Israeli tax authorities, you know who to contact!
