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Simulator for rental income in Israel

Rental income in Israel

Simulate the tax on your rental income in Israel

Use this simulator to calculate the best package for declaring your rental income in Israel.

Indeed, as we explain in this articleIn Israel, there are several packages for declare your rental income.

Use this simulator to find out which package is best for your situation.

Rental income in Israel: Claim a refund on previous years!

If you are accustomed to paying tax on rental income in Israel using the 10% flat rate, you should know that it is possible to make a claim and opt for the real flat rate. This option allows you to go back up to 6 years to adjust your tax returns.

Opting for the actual package offers a number of advantages, including the ability to deduct actual property-related expenses, such as maintenance costs, repairs and mortgage interest. This can potentially reduce your tax burden and increase your long-term savings.

The use of book depreciation and bank interest.

Accounting depreciation and the deduction of bank loan interest are essential aspects to consider when you want to optimize your rental income.

Book depreciation concerns the distribution of the cost of an asset (your apartment) over its lifetime.

In Israel, the lifespan is 25 years, so you can claim 4% of deduction (except on the land portion). In real estate terms, this translates into the possibility of spreading the deduction of costs related to the acquisition or improvement of a property over several years, which can significantly reduce taxable income.

It's crucial to understand the significant impact of book depreciation, even when opting for the 10% flat rate when declaring rental income.
If the property is resold, the book depreciation will be deducted from the purchase value, resulting in an increase in the taxable capital gain, even if you choose to file a fixed-rate tax return with 10% (which does not give you the right to use depreciation).
 
This consideration underlines the strategic importance of choosing the actual flat-rate declaration.

At the same time, the deduction of bank loan interest is a crucial measure for maximizing the profitability of your investments. Interest paid on property loans can be deducted from taxable income, helping to reduce the tax burden.

This deduction is particularly relevant in a context where bank lending rates have risen enormously in Israel.

Get tailor-made tax optimization.

Our tax consultancy is at your disposal to assist you in this process. We can guide you through the necessary steps to make this claim and maximize your tax benefits in Israel.

Please contact us to schedule a personalized consultation to assess how this opportunity can be optimized for your specific financial situation.

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Kanfei Nesharim 68. Merkaz Oranim.

Tel Aviv

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CONTACT US

Phone : 02 631 9000
Fax: 02 631 9005
Email : office@cpa-dray.com

Boruch Levenson - CPA

A native English speaker qualified in both Israel and the UK, Boruch cares for the English speaking clients.

If you've got questions, don't hesitate to reach out.

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Our offices in Israel

Our firm specializes in Israeli accounting and taxation, with in-depth expertise in Olim Hadashim benefits and tax optimization.

Our consultants in Tel Aviv

English speaking accountants in Israel
Address: 31 boulevard Rothschild, Tel-Aviv (Israel)
Phone number: 03-9446635
Fax: 03-9494682
Email: office@cpa-dray.com

Our consultants in Jerusalem

English speaking accountants in Israel
Address: Kanfei Nesharim 68. Merkaz Oranim
Phone number: 02 631 9000
Fax: 02 631 9005
Email: office@cpa-dray.com