This document provides an overview of the Israeli tax system and tax benefits available for foreign residents. It discusses key aspects of the Israeli tax system including determining tax residency, tax rates, and international tax rules. It also outlines several tax benefits for foreign residents such as exemptions from capital gains tax, investment income tax, and participation in programs under the Law for Encouragement of Capital Investment.
סופי מצגות ג'נבה וציריך - 25-25 בנובמבר 2014artzihiba
This document summarizes the presentation "Regularization of Undeclared Israeli Assets" given by Hagi Elmekiesse. It discusses voluntary disclosure procedures and settlement options available through the Israeli Tax Authority for regularizing undeclared offshore bank accounts, trusts, and life insurance policies. Key points covered include the risks of non-disclosure, the two-step voluntary disclosure process, costs of settlement which typically range from 5-18% tax on assets, and temporary procedures available for smaller accounts and trusts.
כנס ציריך גילוי מרצון והסדרי נאמנויות 5 2 2014artzihiba
This document discusses voluntary tax disclosure and trust settlements with the Israeli Tax Authority. It provides background on the speaker's qualifications and experience in international taxation and settlements. It outlines the purposes and conditions for voluntary disclosure, including receiving immunity from criminal sanctions and disclosing previously unreported income and assets. It describes the two-step process for preparing an application, which involves gathering documents, analyzing tax exposure, and applying to settle both criminal and civil issues. It also covers considerations for settling foreign settlor trusts and typical tax rates applied in trust settlements based on past experience.
Trusts Tax Planning Risks and Opportunities artzihiba
- An Israeli resident settlor created a trust in a foreign treaty country, with Israeli resident beneficiaries.
- The trust income is taxed in Israel as income of an Israeli resident, however grants to the trust and distributions from it are not taxed.
- Israel can tax income earned in Israel by the foreign resident trust, and may have limited taxation rights on certain types of Israeli-source income based on the relevant tax treaty.
This document discusses tax planning opportunities and risks related to trusts. It describes risks such as trusts becoming taxable as Israeli trusts after the settlor returns to Israel as a resident. It also describes opportunities such as using trusts to inherit losses or take advantage of the Israeli tax status of trusts. The document provides examples and analysis of relevant sections of Israeli tax law.
This document discusses tax exemptions and reliefs for returning residents and new residents to Israel. It provides definitions for regular returning residents, long-term returning residents, and new residents. It summarizes the key exemptions and reliefs for long-term returning residents and new residents, including a 10-year exemption on income from outside Israel, not having to report foreign assets or income, and exemptions applying to new activities outside Israel. It also compares the exemptions for regular versus long-term returning residents. The document discusses two recent court cases that impacted the interpretation of residency and implications for splitting the family unit. It concludes with information on taxations that may apply to Israeli beneficiary trusts depending on the settlor's alive
The document summarizes key aspects of the Israeli tax system, including:
- Israeli residents are taxed on worldwide income, while foreign residents are taxed only on Israeli-source income. Tax treaties may reduce double taxation.
- Individual tax residency is based on a facts-and-circumstances "center of life" test, with presumptions around number of days present in Israel. Recent court cases provide further guidance.
- Corporate tax rate is 23%, with lower rates on some types of investment income. Controlled foreign corporations may be taxed to prevent deferral or avoidance of Israeli taxes on passive income.
The basics about international treaties designed to prevent fiscal evasion, avoid double taxation and more recently to demonstrate compliance with global standards on transparency and the exchange of confidential taxpayer information. Commonly referred to as 'double taxation agreements' there are over 2,000 of this bilateral agreements in existence. www.franhendy.com ; @franhendy; www.facebook.com/franhendy
CONFLICT OF SOURCE AND RESIDENCE PRINCIPLES OF TAXATIONksanu
This document discusses various types of conflicts that can arise in international taxation between the principles of residence and source. Residence/source conflicts occur when the same income is taxed by both the country of residence under residence principles and the country of source under source principles. Source/source conflicts happen when multiple countries claim income was sourced from their territory. Residence/residence conflicts arise when two countries consider a taxpayer resident under their domestic laws. Double tax agreements aim to resolve these conflicts through provisions regarding sole residence or source taxation, or tiebreaker rules to determine sole residency.
סופי מצגות ג'נבה וציריך - 25-25 בנובמבר 2014artzihiba
This document summarizes the presentation "Regularization of Undeclared Israeli Assets" given by Hagi Elmekiesse. It discusses voluntary disclosure procedures and settlement options available through the Israeli Tax Authority for regularizing undeclared offshore bank accounts, trusts, and life insurance policies. Key points covered include the risks of non-disclosure, the two-step voluntary disclosure process, costs of settlement which typically range from 5-18% tax on assets, and temporary procedures available for smaller accounts and trusts.
כנס ציריך גילוי מרצון והסדרי נאמנויות 5 2 2014artzihiba
This document discusses voluntary tax disclosure and trust settlements with the Israeli Tax Authority. It provides background on the speaker's qualifications and experience in international taxation and settlements. It outlines the purposes and conditions for voluntary disclosure, including receiving immunity from criminal sanctions and disclosing previously unreported income and assets. It describes the two-step process for preparing an application, which involves gathering documents, analyzing tax exposure, and applying to settle both criminal and civil issues. It also covers considerations for settling foreign settlor trusts and typical tax rates applied in trust settlements based on past experience.
Trusts Tax Planning Risks and Opportunities artzihiba
- An Israeli resident settlor created a trust in a foreign treaty country, with Israeli resident beneficiaries.
- The trust income is taxed in Israel as income of an Israeli resident, however grants to the trust and distributions from it are not taxed.
- Israel can tax income earned in Israel by the foreign resident trust, and may have limited taxation rights on certain types of Israeli-source income based on the relevant tax treaty.
This document discusses tax planning opportunities and risks related to trusts. It describes risks such as trusts becoming taxable as Israeli trusts after the settlor returns to Israel as a resident. It also describes opportunities such as using trusts to inherit losses or take advantage of the Israeli tax status of trusts. The document provides examples and analysis of relevant sections of Israeli tax law.
This document discusses tax exemptions and reliefs for returning residents and new residents to Israel. It provides definitions for regular returning residents, long-term returning residents, and new residents. It summarizes the key exemptions and reliefs for long-term returning residents and new residents, including a 10-year exemption on income from outside Israel, not having to report foreign assets or income, and exemptions applying to new activities outside Israel. It also compares the exemptions for regular versus long-term returning residents. The document discusses two recent court cases that impacted the interpretation of residency and implications for splitting the family unit. It concludes with information on taxations that may apply to Israeli beneficiary trusts depending on the settlor's alive
The document summarizes key aspects of the Israeli tax system, including:
- Israeli residents are taxed on worldwide income, while foreign residents are taxed only on Israeli-source income. Tax treaties may reduce double taxation.
- Individual tax residency is based on a facts-and-circumstances "center of life" test, with presumptions around number of days present in Israel. Recent court cases provide further guidance.
- Corporate tax rate is 23%, with lower rates on some types of investment income. Controlled foreign corporations may be taxed to prevent deferral or avoidance of Israeli taxes on passive income.
The basics about international treaties designed to prevent fiscal evasion, avoid double taxation and more recently to demonstrate compliance with global standards on transparency and the exchange of confidential taxpayer information. Commonly referred to as 'double taxation agreements' there are over 2,000 of this bilateral agreements in existence. www.franhendy.com ; @franhendy; www.facebook.com/franhendy
CONFLICT OF SOURCE AND RESIDENCE PRINCIPLES OF TAXATIONksanu
This document discusses various types of conflicts that can arise in international taxation between the principles of residence and source. Residence/source conflicts occur when the same income is taxed by both the country of residence under residence principles and the country of source under source principles. Source/source conflicts happen when multiple countries claim income was sourced from their territory. Residence/residence conflicts arise when two countries consider a taxpayer resident under their domestic laws. Double tax agreements aim to resolve these conflicts through provisions regarding sole residence or source taxation, or tiebreaker rules to determine sole residency.
Relevance of double taxation avoidance agreement and its impactAmudha Mony
This document discusses double taxation avoidance agreements and their impact in India. It begins by defining double taxation as the imposition of two or more taxes on the same income, assets, or financial transactions in different countries. It then outlines the basic rules of source taxation and residence taxation. The document discusses India's double taxation avoidance agreements (DTAAs) with over 85 countries, which agree on tax rates and jurisdiction to avoid double taxation. Sections 90 and 91 of the Indian Income Tax Act provide bilateral and unilateral relief from double taxation. Finally, it briefly outlines the exemption method, credit method, and tax sparing method for eliminating double taxation through these agreements.
Double Taxation Avoidance Agreements (DTAAs) are agreements between countries to mitigate double taxation, where the same income is taxed by two countries. India has comprehensive DTAAs with 88 countries, specifying tax rates and jurisdiction for different types of income earned abroad. Sections 90 and 91 of India's Income Tax Act provide tax relief for income taxed abroad for countries with and without a DTAA with India. Many foreign investors in Indian stock markets operate through Mauritius due to its favorable tax treaty with India, which does not tax capital gains made on selling Indian company shares.
Tax treaties are agreements between countries to reduce double taxation on income. They define which taxes are covered, who is a resident of each country, and circumstances for taxing income of residents in the other country. Tax treaties aim to reduce taxes of residents in one country for income from the other country to alleviate double taxation. They provide exemptions and limit taxation to income from permanent establishments in the other country. Bilateral treaties are between two countries while multilateral treaties involve more than two.
Basics of Double Taxation Avoidance AgreementsGagan Singh
Double taxation avoidance agreements (DTAAs) are bilateral agreements between countries to avoid double taxation of the same income in both countries. DTAAs allocate taxing rights between the source and residence country and provide relief from double taxation through exemption or tax credit methods. For example, interest earned by a non-resident Indian in their non-resident ordinary bank account in India may be taxed at a reduced rate according to the DTAA between India and the NRI's country of residence rather than the default 30.9% withholding tax rate. India currently has over 80 DTAAs to avoid double taxation.
Slides from IBSA Webinar - Double Tax Treaties: Asia & Europe which took place on 18 September 2014, presented by John Timpany of KPMG China and Roy Saunders of IFS Consultants. To view the webinar on demand, please visit our Bright Talk Channel at https://www.brighttalk.com/channel/11641
Double taxation avoidance agreement between india and canadarhejkrhfkBaivabiNayak
The document discusses the Double Taxation Avoidance Agreement (DTAA) between India and Canada. Some key points:
- The DTAA was signed in 1985 and came into effect in 1997 to help taxpayers avoid double taxation on the same income earned in both countries.
- It applies to taxes on income and capital imposed by India and Canada. This includes taxes on things like profits, dividends, interest, royalties.
- The DTAA defines terms like residence, permanent establishment, and outlines how different types of income like business profits, shipping/air transport income, capital gains, pensions are taxed under the agreement.
- The overall aim is to help residents of both countries avoid being tax
This document provides an introduction to international taxation and tax treaties. It begins with definitions of key concepts like globalization and international taxation. It then discusses tax treaties, including their objectives, evolution, models, and structure. The document outlines the prominent articles in tax treaties, including those related to definitions, distributive provisions, and anti-avoidance measures. It also discusses how tax treaties are interpreted and concepts like permanent establishment. Overall, the document aims to introduce fundamental aspects of international taxation and tax treaty frameworks.
Municipalities in Colombia have autonomy to establish regulations for land use and development through a Territorial Land Use Plan (POT). The POT guides physical development and classifies land as urban, rural, or expansion. Construction requires licenses that specify uses, sizes, and technical aspects in accordance with the POT. Real estate can be purchased by foreigners through the same process as Colombians, which involves due diligence, title review, purchase agreement, and registration.
Non-resident Indians can avoid double taxation by using Double Taxation Avoidance Agreements (DTAAs) between India and other countries. DTAAs provide relief from double taxation through exemption, deduction, or credit methods. To use a DTAA, an individual must submit documents like a tax residency certificate and PAN to claim exemptions or credits. Key steps include checking the applicable DTAA, submitting required documents, and considering details like applicable tax rates and ensuring PAN is updated with banks.
The document discusses international taxation issues arising from retrospective amendments made to tax laws. Some key points discussed include:
1. A person who had never deducted taxes on computer software in the past now has to go back and undo those mistakes due to retrospective amendments, even though he was not aware of them previously.
2. There are concerns about the validity and impact of retrospective amendments, including on reopening of assessments, revision of orders, and rectification.
3. The amendments have widened the tax base by expanding the definition of royalty to include computer software, databases, and satellite transmission retroactively. This could lead to more litigation.
4. Issues around tax residency certificates, general anti-
The document discusses international taxation issues arising from retrospective amendments made to tax laws. Some key points discussed include:
1. A person who had never deducted taxes on computer software in the past now has to go back and undo those mistakes due to retrospective amendments, even though he was not aware of them previously.
2. There are concerns about the validity of reopening past assessments and the impact on investors' views of India due to continuous litigation arising from retrospective amendments.
3. Definitions related to taxation of indirect transfers of Indian assets and concepts like royalty, software, and satellite transmissions have been expanded and applied retrospectively.
The document discusses recent changes to the Annual Tax on Enveloped Dwellings (ATED) in the UK. The ATED applies taxes to high-value residential properties owned by corporate entities and non-natural persons. Recent changes have lowered the threshold for properties subject to the tax and increased tax rates. This subjects more properties to the tax, including some held by property developers and letting businesses. Filing requirements and available reliefs are also discussed.
This document provides an overview of international taxation concepts. It discusses how residency is a key factor in determining tax jurisdiction, as countries either tax worldwide income for residents or only income from domestic sources for non-residents. There can be conflicts when countries define residency differently, such as based on place of incorporation versus management and control, which can lead to double taxation. Treaties aim to resolve such conflicts but different countries take different approaches in their treaties. The concepts of residency, jurisdiction, and relief from double taxation are important aspects of international tax.
The prevention of money laundering act, 2002 (2)Himanshu Goyal
The document summarizes key aspects of India's Prevention of Money Laundering Act of 2002. It defines money laundering and outlines the three main stages: placement, layering, and integration. It describes various criminal activities that can generate illicit funds and popular methods used to launder money. The summary also discusses important sections of the act related to definitions, objectives to prevent money laundering, punishment for offenses, attachment and confiscation of property, and search and seizure powers of authorities. The overall purpose of the act is to combat money laundering in India.
The document provides an overview of corporate insolvency processes in Colombia. It explains that corporate insolvency protects companies experiencing financial difficulties from creditors, with the goal of reorganizing viable companies or liquidating unviable ones. The key aspects covered include the types of insolvency processes, eligibility requirements, effects of each process, creditor priorities, fees involved, and the authorities that oversee insolvency cases.
This document discusses double taxation avoidance agreements between countries. It begins with an introduction that defines double taxation as the taxation of the same income by two or more countries. Double taxation creates barriers to international trade and investment. To reduce this, countries enter into double taxation avoidance agreements that coordinate tax jurisdictions and relieve double taxation.
The document then examines the concepts around double taxation avoidance agreements in more detail. It notes that the need for such agreements arises from conflicting tax rules and definitions in different countries. The agreements benefit citizens and help facilitate international economic relations by preventing double taxation. They can provide unilateral or bilateral/reciprocal relief from double taxation.
This document discusses various tax concepts related to multinational corporations (MNCs). It defines tax neutrality as tax provisions that conform to an ideal tax system without favoring certain economic activities. It also discusses tax equity incentives some governments provide for certain projects. It notes the US provides tax equity for solar power projects through tax credits and depreciation policies. It outlines the tax implications of dividend remittance from foreign affiliates to Indian companies. It defines controlled foreign corporations and explains they are commonly used structures for foreign operations, allowing profits to reinvest abroad without domestic tax until repatriated. It compares CFCs to foreign branches and their different tax and liability implications. Finally, it discusses transfer pricing and its role in
This document provides an overview of a presentation on double taxation treaties (DTCs) or double tax avoidance treaties. It discusses the types of treaties, the purpose and objectives of DTCs, the legal status of treaties and model tax conventions, the structure of tax treaties based on the OECD model, how tax treaties interact with domestic tax laws, the distributive rules for allocating taxing rights between source and resident states, and the application and interpretation of tax treaty provisions. Key articles of the OECD model relating to the allocation of taxing rights are also summarized.
This document outlines various national taxes imposed in the Philippines, including income tax, estate tax, value-added tax, excise taxes, customs duties, and other taxes. It provides details on income tax rates and calculations, defining terms like gross income, taxable income, deductions, exemptions, and who is required to file an income tax return.
The Legal 500: Bribery and Corruption Comparative Guide 2018Matheson Law Firm
Claire McLoughlin and Karen Reynolds, Partners in the Commercial Litigation and Dispute Resolution Department and Co-heads of the Regulatory and Investigations Group, co-author the Ireland chapter for The Legal 500: Bribery and Corruption Comparative Guide 2018.
The document summarizes key aspects of Israeli tax law, including:
- Israeli residents are subject to tax on worldwide income, while foreign residents are taxed on Israeli-source income. Individual residency is based on location of life centers or days present in Israel.
- Individual income tax rates range from 30-48% and corporate rates are 29% in 2007 gradually decreasing to 25% in 2010. Rental, capital gains, dividends and interest have separate tax rates.
- The Controlled Foreign Corporation rules tax Israeli residents on passive untaxed foreign company income. Foreign companies deriving most income from Israeli residents' vocations are treated as Israeli tax residents.
- Foreign tax credits offset Israeli tax
This document provides an overview of the Israeli tax system, including:
- Israeli residents are subject to tax on worldwide income, while foreign residents are taxed on Israeli-source income.
- Individual residency is determined by location of permanent home, economic connections, employment, and interests. Entities are residents if incorporated or managed in Israel.
- Income tax rates for individuals range from 30% to 48% depending on income level, gradually decreasing to 44% by 2010. Rental income is taxed at 10% of gross or progressive rates on net income.
- Companies are taxed at declining rates from 29% in 2007 to 25% in 2010 and thereafter. Capital gains are taxed at
Relevance of double taxation avoidance agreement and its impactAmudha Mony
This document discusses double taxation avoidance agreements and their impact in India. It begins by defining double taxation as the imposition of two or more taxes on the same income, assets, or financial transactions in different countries. It then outlines the basic rules of source taxation and residence taxation. The document discusses India's double taxation avoidance agreements (DTAAs) with over 85 countries, which agree on tax rates and jurisdiction to avoid double taxation. Sections 90 and 91 of the Indian Income Tax Act provide bilateral and unilateral relief from double taxation. Finally, it briefly outlines the exemption method, credit method, and tax sparing method for eliminating double taxation through these agreements.
Double Taxation Avoidance Agreements (DTAAs) are agreements between countries to mitigate double taxation, where the same income is taxed by two countries. India has comprehensive DTAAs with 88 countries, specifying tax rates and jurisdiction for different types of income earned abroad. Sections 90 and 91 of India's Income Tax Act provide tax relief for income taxed abroad for countries with and without a DTAA with India. Many foreign investors in Indian stock markets operate through Mauritius due to its favorable tax treaty with India, which does not tax capital gains made on selling Indian company shares.
Tax treaties are agreements between countries to reduce double taxation on income. They define which taxes are covered, who is a resident of each country, and circumstances for taxing income of residents in the other country. Tax treaties aim to reduce taxes of residents in one country for income from the other country to alleviate double taxation. They provide exemptions and limit taxation to income from permanent establishments in the other country. Bilateral treaties are between two countries while multilateral treaties involve more than two.
Basics of Double Taxation Avoidance AgreementsGagan Singh
Double taxation avoidance agreements (DTAAs) are bilateral agreements between countries to avoid double taxation of the same income in both countries. DTAAs allocate taxing rights between the source and residence country and provide relief from double taxation through exemption or tax credit methods. For example, interest earned by a non-resident Indian in their non-resident ordinary bank account in India may be taxed at a reduced rate according to the DTAA between India and the NRI's country of residence rather than the default 30.9% withholding tax rate. India currently has over 80 DTAAs to avoid double taxation.
Slides from IBSA Webinar - Double Tax Treaties: Asia & Europe which took place on 18 September 2014, presented by John Timpany of KPMG China and Roy Saunders of IFS Consultants. To view the webinar on demand, please visit our Bright Talk Channel at https://www.brighttalk.com/channel/11641
Double taxation avoidance agreement between india and canadarhejkrhfkBaivabiNayak
The document discusses the Double Taxation Avoidance Agreement (DTAA) between India and Canada. Some key points:
- The DTAA was signed in 1985 and came into effect in 1997 to help taxpayers avoid double taxation on the same income earned in both countries.
- It applies to taxes on income and capital imposed by India and Canada. This includes taxes on things like profits, dividends, interest, royalties.
- The DTAA defines terms like residence, permanent establishment, and outlines how different types of income like business profits, shipping/air transport income, capital gains, pensions are taxed under the agreement.
- The overall aim is to help residents of both countries avoid being tax
This document provides an introduction to international taxation and tax treaties. It begins with definitions of key concepts like globalization and international taxation. It then discusses tax treaties, including their objectives, evolution, models, and structure. The document outlines the prominent articles in tax treaties, including those related to definitions, distributive provisions, and anti-avoidance measures. It also discusses how tax treaties are interpreted and concepts like permanent establishment. Overall, the document aims to introduce fundamental aspects of international taxation and tax treaty frameworks.
Municipalities in Colombia have autonomy to establish regulations for land use and development through a Territorial Land Use Plan (POT). The POT guides physical development and classifies land as urban, rural, or expansion. Construction requires licenses that specify uses, sizes, and technical aspects in accordance with the POT. Real estate can be purchased by foreigners through the same process as Colombians, which involves due diligence, title review, purchase agreement, and registration.
Non-resident Indians can avoid double taxation by using Double Taxation Avoidance Agreements (DTAAs) between India and other countries. DTAAs provide relief from double taxation through exemption, deduction, or credit methods. To use a DTAA, an individual must submit documents like a tax residency certificate and PAN to claim exemptions or credits. Key steps include checking the applicable DTAA, submitting required documents, and considering details like applicable tax rates and ensuring PAN is updated with banks.
The document discusses international taxation issues arising from retrospective amendments made to tax laws. Some key points discussed include:
1. A person who had never deducted taxes on computer software in the past now has to go back and undo those mistakes due to retrospective amendments, even though he was not aware of them previously.
2. There are concerns about the validity and impact of retrospective amendments, including on reopening of assessments, revision of orders, and rectification.
3. The amendments have widened the tax base by expanding the definition of royalty to include computer software, databases, and satellite transmission retroactively. This could lead to more litigation.
4. Issues around tax residency certificates, general anti-
The document discusses international taxation issues arising from retrospective amendments made to tax laws. Some key points discussed include:
1. A person who had never deducted taxes on computer software in the past now has to go back and undo those mistakes due to retrospective amendments, even though he was not aware of them previously.
2. There are concerns about the validity of reopening past assessments and the impact on investors' views of India due to continuous litigation arising from retrospective amendments.
3. Definitions related to taxation of indirect transfers of Indian assets and concepts like royalty, software, and satellite transmissions have been expanded and applied retrospectively.
The document discusses recent changes to the Annual Tax on Enveloped Dwellings (ATED) in the UK. The ATED applies taxes to high-value residential properties owned by corporate entities and non-natural persons. Recent changes have lowered the threshold for properties subject to the tax and increased tax rates. This subjects more properties to the tax, including some held by property developers and letting businesses. Filing requirements and available reliefs are also discussed.
This document provides an overview of international taxation concepts. It discusses how residency is a key factor in determining tax jurisdiction, as countries either tax worldwide income for residents or only income from domestic sources for non-residents. There can be conflicts when countries define residency differently, such as based on place of incorporation versus management and control, which can lead to double taxation. Treaties aim to resolve such conflicts but different countries take different approaches in their treaties. The concepts of residency, jurisdiction, and relief from double taxation are important aspects of international tax.
The prevention of money laundering act, 2002 (2)Himanshu Goyal
The document summarizes key aspects of India's Prevention of Money Laundering Act of 2002. It defines money laundering and outlines the three main stages: placement, layering, and integration. It describes various criminal activities that can generate illicit funds and popular methods used to launder money. The summary also discusses important sections of the act related to definitions, objectives to prevent money laundering, punishment for offenses, attachment and confiscation of property, and search and seizure powers of authorities. The overall purpose of the act is to combat money laundering in India.
The document provides an overview of corporate insolvency processes in Colombia. It explains that corporate insolvency protects companies experiencing financial difficulties from creditors, with the goal of reorganizing viable companies or liquidating unviable ones. The key aspects covered include the types of insolvency processes, eligibility requirements, effects of each process, creditor priorities, fees involved, and the authorities that oversee insolvency cases.
This document discusses double taxation avoidance agreements between countries. It begins with an introduction that defines double taxation as the taxation of the same income by two or more countries. Double taxation creates barriers to international trade and investment. To reduce this, countries enter into double taxation avoidance agreements that coordinate tax jurisdictions and relieve double taxation.
The document then examines the concepts around double taxation avoidance agreements in more detail. It notes that the need for such agreements arises from conflicting tax rules and definitions in different countries. The agreements benefit citizens and help facilitate international economic relations by preventing double taxation. They can provide unilateral or bilateral/reciprocal relief from double taxation.
This document discusses various tax concepts related to multinational corporations (MNCs). It defines tax neutrality as tax provisions that conform to an ideal tax system without favoring certain economic activities. It also discusses tax equity incentives some governments provide for certain projects. It notes the US provides tax equity for solar power projects through tax credits and depreciation policies. It outlines the tax implications of dividend remittance from foreign affiliates to Indian companies. It defines controlled foreign corporations and explains they are commonly used structures for foreign operations, allowing profits to reinvest abroad without domestic tax until repatriated. It compares CFCs to foreign branches and their different tax and liability implications. Finally, it discusses transfer pricing and its role in
This document provides an overview of a presentation on double taxation treaties (DTCs) or double tax avoidance treaties. It discusses the types of treaties, the purpose and objectives of DTCs, the legal status of treaties and model tax conventions, the structure of tax treaties based on the OECD model, how tax treaties interact with domestic tax laws, the distributive rules for allocating taxing rights between source and resident states, and the application and interpretation of tax treaty provisions. Key articles of the OECD model relating to the allocation of taxing rights are also summarized.
This document outlines various national taxes imposed in the Philippines, including income tax, estate tax, value-added tax, excise taxes, customs duties, and other taxes. It provides details on income tax rates and calculations, defining terms like gross income, taxable income, deductions, exemptions, and who is required to file an income tax return.
The Legal 500: Bribery and Corruption Comparative Guide 2018Matheson Law Firm
Claire McLoughlin and Karen Reynolds, Partners in the Commercial Litigation and Dispute Resolution Department and Co-heads of the Regulatory and Investigations Group, co-author the Ireland chapter for The Legal 500: Bribery and Corruption Comparative Guide 2018.
The document summarizes key aspects of Israeli tax law, including:
- Israeli residents are subject to tax on worldwide income, while foreign residents are taxed on Israeli-source income. Individual residency is based on location of life centers or days present in Israel.
- Individual income tax rates range from 30-48% and corporate rates are 29% in 2007 gradually decreasing to 25% in 2010. Rental, capital gains, dividends and interest have separate tax rates.
- The Controlled Foreign Corporation rules tax Israeli residents on passive untaxed foreign company income. Foreign companies deriving most income from Israeli residents' vocations are treated as Israeli tax residents.
- Foreign tax credits offset Israeli tax
This document provides an overview of the Israeli tax system, including:
- Israeli residents are subject to tax on worldwide income, while foreign residents are taxed on Israeli-source income.
- Individual residency is determined by location of permanent home, economic connections, employment, and interests. Entities are residents if incorporated or managed in Israel.
- Income tax rates for individuals range from 30% to 48% depending on income level, gradually decreasing to 44% by 2010. Rental income is taxed at 10% of gross or progressive rates on net income.
- Companies are taxed at declining rates from 29% in 2007 to 25% in 2010 and thereafter. Capital gains are taxed at
Israeli Participation Exemption Regime
An Israeli holding company can benefit from the participation exemption regime which exempts dividends and capital gains from qualified subsidiaries held for over 12 months. Key conditions include the holding company being incorporated and managed in Israel, with over 75% of assets and income from foreign subsidiaries. This allows Israeli and foreign shareholders to benefit from low tax rates on dividends and capital gains. Upcoming legislation may tighten residency rules, making it harder to claim non-residency status. The tax treatment of trusts that change residency status due to beneficiaries is unclear under current law.
1. Hiba Artzi and Cohen Elmekiesse of Tax Solutions presented on various tax issues at the 2019 AITC AGM in Utrecht, Netherlands, including voluntary disclosure of unreported assets and foreign bank accounts, taxation and settlements of trusts, and cryptocurrency taxation.
2. Gadi Alimi, a partner at Tax Solutions specializing in international taxation, discussed international tax structures involving countries like Greece, Germany, Cyprus and utilizing holding companies and branches. He also covered residency of individuals and companies for tax purposes and tax benefits for new immigrants, returning residents and foreign residents investing in Israel.
3. The presentation explained Israel's Law for Encouragement of Capital Investment which provides lower
The document discusses Israel's taxation of trusts. It outlines the different types of trusts under Israeli law, including foreign resident settlor trusts which are generally exempt from Israeli taxes. These trusts allow foreign residents to utilize an Israeli trust for offshore purposes. The document explains how foreign resident settlors and beneficiaries are not required to report foreign-source trust income in Israel. It also introduces the concept of an "underlying company" that can hold trust assets to avoid Israeli tax on non-Israeli income. Finally, it lists characteristics of preferred jurisdictions for establishing trusts and Israel's extensive tax treaty network.
Special purpose vehicles (SPVs) are commonly used in Jersey for securitizations, debt defeasance, and other financial transactions. An SPV is typically an "orphan" company established for a specific purpose, with shares held by trustees of a charitable trust. Jersey provides an ideal environment for SPVs through its low tax regime and experienced professional resources. Establishing an SPV involves incorporating a company and obtaining necessary consents. Once established, SPVs benefit from Jersey's straightforward administration requirements and tax exemption available to non-Jersey resident companies.
Premier international associates meeting 2009 hagi 10052009 v12 - hagiartzihiba
Hagi Elmekiesse, an international tax partner at Artzi, Hiba & Elmekiesse Tax Solutions Ltd., gave a presentation on the global combat against tax havens and unreported financial accounts. The presentation discussed efforts by organizations like the OECD, G20, and IRS to increase transparency of financial accounts and pressure tax havens to adopt more cooperative policies like exchanging tax information. Recent agreements have seen many offshore jurisdictions agree to new tax treaties and information sharing. The presentation also summarized Israel's policies on tax settlements and disclosure relating to offshore accounts and trusts.
This document discusses recent changes to VAT policies in East African countries as they relate to the tourism industry. It notes that while countries like Uganda and Tanzania have maintained VAT exemptions for tourism-related services and accommodations after lobbying from the industry, Kenya has eliminated several exemptions. There is currently a lack of harmonization between the different VAT regimes in East Africa. Harmonizing these policies will help the region realize the full economic benefits of integration under the East African Community.
This document summarizes the tax treatment of acquisitions in Israel, including differences between stock acquisitions and asset acquisitions, availability of step-up in basis for assets, tax benefits of issuing stock as consideration, documentary taxes payable, treatment of net operating losses, interest deductibility, and protections typically sought. It also discusses various post-acquisition restructuring options in Israel such as tax-neutral spin-offs and preservation of net operating losses, migration of company residence, withholding tax rates on outbound interest and dividend payments, and other tax-efficient means of extracting profits.
1. The document discusses the Egyptian tax system and investment tax incentives. It provides an overview of Egypt's tax system, describing both direct taxes like income tax and indirect taxes like sales tax.
2. Key parts of Egypt's tax system are outlined, including the various government departments responsible for enforcing different tax laws. The income tax law and its treatment of individual income tax, corporate tax, and general rules are examined.
3. Details are given around individual income tax in Egypt, including the different types of taxable income, exemptions, tax rates, and deductions involved in the taxation of salaries/wages and mobile capital revenue.
The document summarizes the Dutch tax regime for collective investments. It discusses three main types of structures under Dutch law - fiscally transparent structures, the Fiscal Investment Institution (FII), and the Exempt Investment Institution (EII). Fiscally transparent structures are disregarded for tax purposes, resulting in one layer of tax at the investor level. The FII is a corporate taxpayer but has a 0% tax rate, while the EII is exempt from corporate tax entirely. Both the FII and EII convert all investment income into dividend income at the fund level.
The document summarizes the Dutch tax regime for collective investments. It discusses three main types of structures under Dutch law - fiscally transparent structures, the Fiscal Investment Institution (FII), and the Exempt Investment Institution (EII). Fiscally transparent structures are disregarded for tax purposes, resulting in one layer of tax at the investor level. The FII is a corporate taxpayer but has a 0% tax rate, while the EII is exempt from corporate tax. Both the FII and EII convert investment income into dividend/capital gain income at the CIV level.
The relocation process involves many aspects, including family aspects, legal aspects and economic aspects. Alongside these aspects, there are taxation aspects of relocation to Portugal that must be considered before leaving Israel. The need to examine the residency of individuals in the process of relocation or immigration to a foreign country is very significant for Israeli residents residing abroad, due to the accompanying tax implications. Seeking tax advice from a tax expert in order to arrange the reporting and payment of tax in Israel is mandatory. One of the main aspects that there is To examine when considering relocation or return from it is the tax aspect, and in particular – the manner of reporting to the Tax Authority on fruitful income generated during the stay abroad or income accrued from capital assets acquired during the stay abroad while avoiding accidents, double taxation and double payment of National Insurance. During the stay abroad, the individual generally has three main alternatives for dealing with the Israel Tax Authority:
https://www.bshcpa.co.il/
Shen Yongqi Chief Economist, Beijing Local Taxation Bureau asia business wee...Asia Matters
"Beijing: Doing Business in a Global Megacity" / "Relevant Tax Policies For Foreign Investment" Shen Yongqi, Chief Economist, Beijing Local Taxation Bureau, speaking on 4 June at Dublin Beijing Business Summit during Asia Business Week Dublin 2014
Income tax in Kenya is governed by the Income Tax Act and charges tax on various types of income earned by individuals and corporations. There are several methods of collecting income tax, including: Pay As You Earn (PAYE) for employed individuals; Corporation Tax for companies; Installment Tax for those with tax liability over Kshs. 40,000; Withholding Tax deducted at source; Advance Tax paid before vehicle licensing; Turnover Tax on business with annual sales over Kshs. 1 million; Residential Rental Income Tax; and Capital Gains Tax on property transfers.
The document summarizes various tax benefits, relief, and exemptions available for foreign residents, new immigrants, and returning Israelis under Israeli law. This includes a 10-year tax exemption on income earned outside of Israel, no estate or gift tax, exemptions from capital gains and income taxes on various investments and assets, reduced tax rates on rental income, and exemptions from purchase and betterment taxes for new immigrants. Israel aims to be a tax haven for foreign investments and residents through these beneficial tax policies.
Tax Guide to Overseas Real Estate Investments for U.S. InvestorsDurise
Before you even begin to consider a jump into the foreign real estate investment pool, it’s important to become as knowledgeable about the entire process as possible. One item that is particularly important to research and understand is the tax implications that go along with property investing overseas. To that end, we’ve put together this tax guide to help U.S. real estate investors gather some much needed tax information.
This document summarizes a presentation on recent federal income tax incentives targeted at small businesses. It discusses policy considerations for supporting small businesses and reviews choices of business entities such as sole proprietorships, partnerships, S-corporations and C-corporations. It also summarizes tax incentives for small business investments including qualified small business stock gains exclusion and ordinary loss treatment for small business stock. The document concludes by reviewing employment related tax incentives such as the federal unemployment tax rate reduction and the deduction for health insurance costs for self-employed individuals.
केरल उच्च न्यायालय ने 11 जून, 2024 को मंडला पूजा में भाग लेने की अनुमति मांगने वाली 10 वर्षीय लड़की की रिट याचिका को खारिज कर दिया, जिसमें सर्वोच्च न्यायालय की एक बड़ी पीठ के समक्ष इस मुद्दे की लंबित प्रकृति पर जोर दिया गया। यह आदेश न्यायमूर्ति अनिल के. नरेंद्रन और न्यायमूर्ति हरिशंकर वी. मेनन की खंडपीठ द्वारा पारित किया गया
18062024_First India Newspaper Jaipur.pdfFIRST INDIA
Find Latest India News and Breaking News these days from India on Politics, Business, Entertainment, Technology, Sports, Lifestyle and Coronavirus News in India and the world over that you can't miss. For real time update Visit our social media handle. Read First India NewsPaper in your morning replace. Visit First India.
CLICK:- https://firstindia.co.in/
#First_India_NewsPaper
Why We Chose ScyllaDB over DynamoDB for "User Watch Status"ScyllaDB
Yichen Wei and Adam Drennan share the architecture and technical requirements behind "user watch status" for a major global media streaming service, what that meant for their database, the pros and cons of the many options they considered for replacing DynamoDB, why they ultimately chose ScyllaDB, and their lessons learned so far.
La defensa del expresidente Juan Orlando Hernández, declarado culpable por narcotráfico en EE. UU., solicitó este viernes al juez Kevin Castel que imponga una condena mínima de 40 años de prisión.
लालू यादव की जीवनी LALU PRASAD YADAV BIOGRAPHYVoterMood
Discover the life and times of Lalu Prasad Yadav with a comprehensive biography in Hindi. Learn about his early days, rise in politics, controversies, and contribution.
16062024_First India Newspaper Jaipur.pdfFIRST INDIA
Find Latest India News and Breaking News these days from India on Politics, Business, Entertainment, Technology, Sports, Lifestyle and Coronavirus News in India and the world over that you can't miss. For real time update Visit our social media handle. Read First India NewsPaper in your morning replace. Visit First India.
CLICK:- https://firstindia.co.in/
#First_India_NewsPaper
19 जून को बॉम्बे हाई कोर्ट ने विवादित फिल्म ‘हमारे बारह’ को 21 जून को थिएटर में रिलीज करने का रास्ता साफ कर दिया, हालांकि यह सुनिश्चित करने के बाद कि फिल्म निर्माता कुछ आपत्तिजनक अंशों को हटा दें।
#WenguiGuo#WashingtonFarm Guo Wengui Wolf son ambition exposed to open a far...rittaajmal71
Since fleeing to the United States in 2014, Guo Wengui has founded a number of projects in the United States, such as GTV Media Group, GTV private equity, farm loan project, G Club Operations Co., LTD., and Himalaya Exchange.
Shark Tank Jargon | Operational ProfitabilityTheUnitedIndian
Don't let fancy business words confuse you! This blog is your cheat sheet to understanding the Shark Tank Jargon. We'll translate all the confusing terms like "valuation" (how much the company is worth) and "royalty" (a fee for using someone's idea). You'll be swimming with the Sharks like a pro in no time!
Apna Punjab Media is a Punjabi newspaper that covers local and global news, cultural updates, and community events. It's a trusted source for Punjabi-speaking communities, offering a mix of traditional values and modern insights into Punjab's vibrant life and heritage.
15062024_First India Newspaper Jaipur.pdfFIRST INDIA
Find Latest India News and Breaking News these days from India on Politics, Business, Entertainment, Technology, Sports, Lifestyle and Coronavirus News in India and the world over that you can't miss. For real time update Visit our social media handle. Read First India NewsPaper in your morning replace. Visit First India.
CLICK:- https://firstindia.co.in/
#First_India_NewsPaper
Christian persecution in Islamic countries has intensified, with alarming incidents of violence, discrimination, and intolerance. This article highlights recent attacks in Nigeria, Pakistan, Egypt, Iran, and Iraq, exposing the multifaceted challenges faced by Christian communities. Despite the severity of these atrocities, the Western world's response remains muted due to political, economic, and social considerations. The urgent need for international intervention is underscored, emphasizing that without substantial support, the future of Christianity in these regions is at grave risk.
https://ecspe.org/the-rise-of-christian-persecution-in-islamic-countries/
projet de traité négocié à Istanbul (anglais).pdfEdouardHusson
Ceci est le projet de traité qui avait été négocié entre Russes et Ukrainiens à Istanbul en mars 2022, avant que les Etats-Unis et la Grande-Bretagne ne détournent Kiev de signer.
Federal Authorities Urge Vigilance Amid Bird Flu Outbreak | The Lifesciences ...The Lifesciences Magazine
Federal authorities have advised the public to remain vigilant but calm in response to the ongoing bird flu outbreak of highly pathogenic avian influenza, commonly known as bird flu.
3. Artzi,Hiba&Elmekiesse
3
The Israeli tax system - General
• As of 2003, income Tax in Israel is levied
based on a personal method. Accordingly,
Israeli residents are liable to tax in respect
of their income worldwide.
• Foreign residents are also liable to tax in
Israel with respect to income generated or
derived therein (according to source rules)
and subject to conventions for prevention of
double taxation between Israel and the
relevant countries.
4. Artzi,Hiba&Elmekiesse
4
Israeli resident - Individuals
• An individual is considered an Israeli
resident if his “center of life” is located
therein; in this regard, the following
considerations are observed:
– location of his permanent home (individual &
family members).
– Location of his economic and social connections.
– Location of his permanent or usual employment/
business activity.
– Location of his active and substantive economic
interests.
5. Artzi,Hiba&Elmekiesse
5
Israeli resident - Individuals
• The Israeli law sets 2 legal presumptions - an
individual's “center of life” is located in Israel in the
following cases:
– During the tax year he was present in Israel for 183 days
or more, or -
– During the tax year he was present in Israel for 30 days
or more, and his total presence in Israel during that year
and 2 previous years amounts to 425 days or more.
• Foreign residency from “Day 1”, if during the two
first tax years the individual was present in Israel
for less than 183 days, and his “center of life” was
outside of Israel for the following 2 tax years.
• Marginal Tax rates: 48% (from 2012).
6. Artzi,Hiba&Elmekiesse
6
Israeli resident – Body of persons
• A person other than an individual is considered an
Israeli resident if either one of the following is met:
– It was incorporated in Israel.
– the “management and control” over its business is
exercised within Israel.
• Corporate tax rate:
– 25% (from 2012).
– This tax rate applies also to Capital Gains.
7. Artzi,Hiba&Elmekiesse
7
Rental income from Israel
• Tax exemption for rental income from
apartments in Israel up to 4,910 NIS (2012).
• The income tax liability on apartments rental
fees is calculated on the basis of one of the
following alternatives:
– Rental income is calculated after deduction of
expenses and taxed as business income with the
usual (progressive) tax rates - over 30% rate.
– Tax is payable at the rate of 10% of gross rental
income (without deducting expenses).
8. Artzi,Hiba&Elmekiesse
8
Overseas Rental income
• The tax liability of an Israeli resident individual
with respect to rental income from real property
located outside of Israel, is determined on the basis
of one of the following:
– progressive tax rates applied to net rental income
(deduction of permissible expenses). FTC is allowed.
– flat rate of 15% on rental fees after deduction of only
depreciation expenses. other expenses incurred in
generating the rental income are not deductible. FTC is
denied.
11. Artzi,Hiba&Elmekiesse
11
Controlled Foreign Corporation (CFC)
General
• Designed to prevent the deferment or
avoidance of taxes through the use of foreign
corporations, with respect to passive income.
• An Israeli resident who has control (10% or
more of any of the means of control) over a
controlled-foreign-corporation, is subject to
tax on his pro-rata portion of that corporation’s
“undistributed profits” as though they were
actually distributed to him as dividends at the
end of tax year - Deemed dividend.
12. Artzi,Hiba&Elmekiesse
12
Controlled Foreign Corporation (CFC)
Definition
• A “controlled foreign corporation” is a Foreign
resident body-of-persons that meets the following:
– Its shares or other interests are not traded on a stock
exchange.
– Most of its income or profits during the tax year are
passive. In this regard, a specific rule is set for a
corporation held by a business company.
– The tax applied to its passive income overseas does not
exceed 20%.
– More than 50% of any of the corporate’s “means of
control” are held, directly or indirectly, by Israeli
residents.
13. Artzi,Hiba&Elmekiesse
13
Controlled Foreign Corporation (CFC)
Passive Income
• “Passive Income” - an income being one of the
following, except if it is of a business nature:
– Interest or linkage differences.
– Dividends.
– Royalties.
– Rental income.
– Consideration for the sale of an asset which was
not used as part as the corporation’s business.
14. Artzi,Hiba&Elmekiesse
14
Controlled Foreign Corporation (CFC)
“Undistributed Profits”
• Profits originating in passive income of the
company, except for profits originating from
dividends received from another foreign
corporation whose income was taxed at a rate that
exceeds 20%, that were not paid to shareholders
during the tax year
• The profits are calculated according to domestic
tax laws of the foreign company’s state of
residence, except if it is not a “treaty country“, in
which case the profits will be calculated according
to accounting principles accepted in Israel (IFRS).
18. Artzi,Hiba&Elmekiesse
18
Foreign Vocation Company (FVC)
General
• A foreign body-of-persons that meets all the following:
– If it is a company, not more than 5 individuals control
the company.
– 75% or more of any “means of control” are held,
directly or indirectly, by Israeli resident individuals.
– Most of the controlling members or their relatives,
carry on “a special vocation” on behalf of the
corporation.
– Most of its income or profits derive from “a special
vocation”.
19. Artzi,Hiba&Elmekiesse
19
Foreign Vocation Company (FVC)
Foreign Vocation income
• Income generated by FVC from activities
preformed by a controlling members
(through his relative or a company under his
control) shall be taxed in Israel as income
generated in Israel.
• The FVC is considered an Israeli resident for
domestic tax purposes.
21. Artzi,Hiba&Elmekiesse
21
Indirect (underlying) tax credit for an
Israeli company
• Credit for the tax paid on income in which a dividend
was shared, under certain conditions:
– Corporate Tax debit on the “included dividend”.
– Chaining maintenance up to a level of a
subsubsidiary company subjugated to the
minimum maintenance rate: 25% in the subsidiary
company and 50% in the subsubsidiary company
(by the subsidiary company).
• Deemed underlying foreign tax credit is granted for
CFC purposes.
23. Artzi,Hiba&Elmekiesse
23
Israeli withholding tax rates to foreign
residents
• General rule: 25% withholding tax on any taxable
income paid to non-residents.
• Dividends:
– General rule: 25%.
– Controlling member (10% of the means of control): 30%;
• Interest:
– General rule: 25%.
– Controlling member (10% of the means of control): the
usual (progressive) tax rates - over 30% rate
• Lower withholding tax rates according to tax treaties.
24. Artzi,Hiba&Elmekiesse
24
IL
No branch tax in Israel
CY
Activity in
Israel
Israeli CIT
25%
25%
0%
Israeli WTT on
dividends
CY
Activity in
Israel (PE)
Israeli CIT
0%
25%
0%
NO WTT
26. Artzi,Hiba&Elmekiesse
26
Categories of exemptions &
benefits
• Exemption from tax on capital gains;
• Exemption from tax on investment income;
• Law for Encouragement of Capital
Investment from 1959;
• Participation Exemption.
27. Artzi,Hiba&Elmekiesse
27
Law for Encouragement of Capital Investment
general overview
• Israel encourages investments from both Israeli and
foreign residents, by offering a wide range of
incentives and benefits through a number of laws and
regulations.
• In order to promote weak economic regions within
Israel, greater benefits in “priority regions”. However,
enterprises throughout the country may be eligible
for benefits if they comply with the relevant criteria.
• Significant amendments have recently been enacted
into the law (amendment no. 68).
28. Artzi,Hiba&Elmekiesse
28
Law for Encouragement of Capital Investment
Benefits and conditions
• Lower tax rates compared to the ITO:
• Lower tax rate on dividends distributions (15% instead of
25%-30%);
• Accelerated depreciation expenses;
• Possibility of entitlement for both grants and tax benefits;
• The law applies also to indirect exporters;
• Conditions: industrial activity, export requirement (25% of
the revenues), and more.
OtherPeripheryYear
15%10%2011- 2012
12.5%7%2013- 2014
12%6%from 2015
29. Artzi,Hiba&Elmekiesse
29
Exemption for capital gains
• Gain derived from the sale of securities traded in Israeli
stock exchange, provided the gain was not derived within a
permanent establishment of the seller located in Israel
(doesn’t apply to short-term bonds issued by the Israeli
Government).
• Gain derived from the sale of Israeli resident company’s
securities traded in a foreign stock exchange, provided the
gain was not derived within a permanent establishment of
the seller located in Israel, the security was purchased
after registration for trade and other conditions.
• Gain derived from the sale of shares in an Israeli resident
company who - at the time of issuance of such shares - was
approved as an “R & D Company”.
30. Artzi,Hiba&Elmekiesse
30
Special exemption to boost
investments - Art. 97(B3)
• Special exemption from Capital Gain in
relation to investments in Israeli non-traded
resident companies (or foreign companies
whose main assets are interests in Israeli
assets).The exemption is excluded for:
– Gain derived within a PE of the seller in Israel.
– Gain derived from the sale of a Real Estate
company*
* any security of a company which - at the acquisition date of that
security and two years preceding its sale - the major value of its assets
comprised of interests in real estate located in Israel or in an Israeli
real estate company.
31. Artzi,Hiba&Elmekiesse
31
Special exemption to boost
investments
• Conditions - Acquisition between 1.1.05 - 31.12.08.
– The seller reported the sale to the tax authorities of country
of which he is a resident.
– The seller was a resident of a treaty country (both at the
purchase and sell date), as follows:
• An individual purchaser - was a resident of a treaty country for at
least 10 years prior to acquisition;
• A foreign entity purchaser - at least 75% of “controlling interests”
over such entity were held, directly or indirectly, by individuals who
were residents of a treaty country for at least 10 years prior to
acquisition.
• Conditions - Acquisition after 1.1.2009:
– The purchaser was a foreign resident (including any non-
treaty country).
32. Artzi,Hiba&Elmekiesse
32
Exemption for interest paid to foreign
residents• interest, discount fees and currency differences
income, which are generated by a foreign resident
from Israeli traded bonds and debentures may be
tax exempt
– subject to certain conditions, including the
requirement that the foreign resident would not hold
a "substantial shareholding" (10% or more);
– doesn’t apply to short-term bonds issued by the
Israeli Government.
• Interest paid to a foreign resident for a foreign
currency deposit in an Israeli bank is exempt
– provided certain conditions are met.
33. Artzi,Hiba&Elmekiesse
33
Dividends paid to foreign
residents
• Dividends from traded and non-traded
Israeli securities - It should be emphasized
that generally, dividend income of a foreign
resident from Israeli securities is taxable in
Israel at a rate of 25% or 30%, depending on
the rate of participation.
– Lower withholding tax rate may apply according to
tax treaties.
34. Artzi,Hiba&Elmekiesse
34
Article 16A of ITO
• The Minister of Finance is authorized to return income
tax, fully or partly, to a foreign resident if the tax
payable in Israel is not granted to his as a credit
against the tax due in his state of residence.
• Application to foreign investors in investment funds
operating and investing in Israel:
– VC Funds- Full exemption on all kind of income (Capital
Gain, dividends, interest);
– Private Equity Funds- Exemption on Capital Gain
(exemption on dividends and interest only to income
attributed to “Exempt Foreign Investor”).
35. Artzi,Hiba&Elmekiesse
35
Anti abuse section – 68A
• special anti abuse
section to prevent
“Israelis” from abusing
such benefits:
• If the foreign resident
company is owned,
directly or indirectly, by
Israeli residents, the
foreign resident is not
entitled to benefits.
IL
CY
No exemption
granted
25% or more
37. Artzi,Hiba&Elmekiesse
37
Participation Exemption
• A participation exemption regime for Israeli
holding companies, under specific conditions.
• An Israeli holding company is exempt from tax
on the following:
– dividends received from foreign “active”
subsidiaries;
– capital gains tax upon sale of such subsidiaries;
– interest on bank deposits in Israel and on income
(interest, dividends, and capital gains) from
securities traded in Israeli stock exchange.
38. Artzi,Hiba&Elmekiesse
38
Participation Exemption - benefits for
foreign investors
• Foreign shareholders benefit from a reduced
withholding rate on dividends distributed by
the Israeli holding company – only 5%.
• Foreign shareholders may apply for tax
exemption on capital gain upon the sale of the
Israeli holding company’s share under Art.
97(B3) - special exemption.
40. Artzi,Hiba&Elmekiesse
40
Participation exemption
• Definitions:“Israeli holding company”
– Registered in Israel, Managed and control from Israel.
– Privately owned and not tax transparent.
– Not a financial institution.
– Its total investment in foreign subsidiaries, throughout at
least 300 days of the tax year, amounts to at least 50 million
NIS.
– 75% or more of its assets constitute the subsidiaries.
– The company formally requests to be recognized as a
holding company.
41. Artzi,Hiba&Elmekiesse
41
Participation exemption
• “Subsidiary” for participation exemption:
– Resident of a treaty country.
– Resident in non treaty country - provided that the corporate
tax rate on business income in that country is 15% or more
(at time the shares are purchased).
– The Israeli holding company holds at least 10% of profit
rights in the subsidiary for 12 consecutive months.
– At least 75% of the subsidiary’s income from sources outside
Israel is business income.
– Israeli assets or Israeli income of the subsidiary may not
comprise more than 20% of the subsidiary’s total
assets/income, respectively.