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The Israeli identity card - Teoudat Zehout
An Israeli citizen who lives permanently abroad has asked the Supreme Court to oblige the Ministry of the Interior to issue him with a new identity card in place of his lost one.
The Supreme Court has ruled that the right to an identity card is granted:
- to an Israeli resident in Israel.
- or whose center of life is in Israel.
An Israeli whose center of life is abroad is not entitled to the issuance of an identity card (a new one or in place of a lost/stolen one).
This could be a major event for many Israeli citizens who don't necessarily live in Israel, especially when it comes to banking.
Let's take a tour together in this article.
The right to receive Teudat Zehout
A petition was submitted to the Supreme Court by an Israeli citizen who lives permanently in Norway, asking the following question: "Does an Israeli citizen, whose center of life is not in Israel, have the right to receive a new identity card in the event of loss?".
The applicant states that he often comes to Israel and that he needs his Israeli identity card to manage his assets and open a bank account in Israel.
The Ministry of the Interior, which is supposed to issue Teoudat Zehout, has stated that, in accordance with Section 24 of the Population Registration Law, which stipulates that every Israeli resident in Israel who is 16 years of age or older is entitled to receive an identity card.
It is not possible to issue an identity card to the applicant, as he is not "in Israel" according to the law. He does not meet the criteria for tax residence in Israel.ALSO READ: Who is considered an Israeli resident?
What about Israeli passport renewal?
A Jew interested in an Israeli passport must first obtain citizenship, make Israel the center of his life, and after about a year, he will be entitled to an Israeli passport.
During the first three months of immigration, the new immigrant will be able to enter and leave Israel with a passport from his or her country of origin, accompanied by a letter from the Ministry of the Interior indicating that he or she is in the final phase of the immigration procedure to Israel.ALSO READ: How do you calculate tax on property income in Israel?
What are the new risks?
Apart from the fact that we have a few more problems getting into Israel than an Israeli with a valid passport, some of us have much more serious problems.
Indeed, the main problem is Israeli banks. As a reminder, since Israel became a signatory to the FATCA/CRS international treatiesAs part of the Israeli tax system, every account holder in Israel must declare which country he or she is a tax resident in. This will enable the bank to inform the tax authorities in the account holder's country of tax residence about the account's balances and movements.
Several new immigrants were thus able to present their file as Israeli tax residents to the Israeli bank, showing them their teoudat Zehout and/or Israeli passport.
The problem is that bankers, knowing the new position of the Ministry of the Interior, are likely to ask to update their list of "certain clients" and to ask them for their new teoudat Zehout and/or Israeli passport.
If the account owner can't provide them with a new, updated ID, this will necessarily mean that the Ministry of the Interior has already done the work of finding out whether the person is an Israeli tax resident or not.
The bank will therefore need to know which country the account holder belongs to for tax purposes, in order to notify the tax authorities in that country.
Watch out!
If the bank puts you on the list of "foreign tax resident" customers, banking information will be exchanged automatically between Israel and your country of tax residence.
If you are concerned by this issue, please do not hesitate to contact us.
What can we expect?
If the account holder refuses to state his or her country of residence for tax purposes, the bank can simply freeze the assets in the account until it receives satisfaction.
Let's say that if the bank account is virtually empty, there would be almost no risk, but what about the age of the account? Can the bank send a report to Israel's anti-money-laundering ministry or to the Israeli tax authorities, who have further information on this person's potential other citizenship, and who will be able to notify the appropriate tax authorities if necessary?
What are the solutions?
As you can see, for some people, updating their status to obtain an Israeli passport is of the utmost importance!
But what about those who can't get a passport? What legal solutions are available to them?
In a nutshell:
To renew your Israeli passport or Teoudate Zeoute, you need to be physically present in the country.
In many cases, the Ministry of the Interior can be lenient and make an exception if the request is properly formulated.
What is the main risk in refusing to renew an Israeli passport / Teoudate zeoute?
The main risk concerns the exchange of banking information between Israel and your country of residence.
Your questions - our advice
- Is an Ole Hadash involved?
- Does this law apply to all the department's offices?
- Can my wife get the card and I can't?
- What should I tell the bank if it asks me to prove my tax residence?
- What information is automatically exchanged between France and Israel?
