Israel

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Country Knowledge

Our local member provided the following preliminary information about doing business in this country.
Please contact the firm for more information and obtain professional advice in each country concerned.
Our local member will be happy to help you proceed with your business!

General information

Languages :

  • Hebrew
  • English

Population : Nearly 10 millions

Currency: New Israel Shekel (NIS or ILS)

Current Exchange Rate to USD: USD 1 = NIS 3.4

Standard corporate income tax rate:

23 %

Main tax incentives:

7.5%-16% corporate income tax for industrial, tech preferred enterprises. Tax breals also in agriculture and for certain approved rental buildings

Other incentives:

50% R&D grants typically, free trade agreements and R&D grant collaboration with various countries including the USA, UK and EU.

Standard dividend withholding tax rates:

25%-33%, subject to applicable tax incentives and/or tax treaty.

Branch taxation:

Generally no branch remitttance tax

Standard Interest withholding tax:

Generally 25% subject to tax treaty

Interest expense deduction rules:

Wholly and exclusively for generating income, not capital purposes.

Standard royalty withholding tax rate:

Generally 25% subject to tax treaty

Laws and government

Common law: Based on UK legal and tax principles.

Federal / national only?: Yes

State / provincial too?: No

Data privacy rules?:

Yes

Data security rules?:

Yes

Standards & Tax treaties

Number of tax treaties: With 60 countries

OECD MLI treaty signatory?: YES

Type of tax: VAT

Taxes on foreign services?: 25% withholding tax unless reduced by tax treaty, or tax circular

Typical time and cost to incorporate a local private company: 1 - 4 weeks typically, NIS 5 - 6,000

Typical time and cost to register a branch of a foreign company: 1 - 4 weeks typically, NIS 5 - 6,000. But bank account and VAT registration may take additional time.

Typical business/tax/other issues in the country:

Obtaining incentives, permanent establishment issues, withholding tax, VAT, bank AML procedures. Israel is an OECD member adopting US FATCA and OECD initiatives e.g. Pillar 1&2, CRS.

The information provided on this website is intended for general informational purposes only and should not be construed as professional advice. While our members make every effort to ensure the accuracy and reliability of the information presented, we cannot guarantee its completeness, timeliness, or suitability for any particular purpose.

We strongly recommend that you seek professional advice from a qualified expert in the relevant field before making any decisions or taking any actions based on the information provided on this website. Your reliance on any information presented on this website is at your own risk.

Please note that the information on this website is subject to change without notice, and we assume no responsibility or liability for any errors or omissions in the content. By accessing and using this website, you agree to release us from any and all claims, liabilities, and damages arising from your use of the information provided herein.

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