Costs and Fees (valid for January 2018)
When Leasing a property the following are the costs that must be taken into account :
Real Estate Broker’s Commission (Dmei Tivuch)
On leasing property brokers customarily charge as follows
1.For a period of one year or more – one month rent.
2.For a period less than one year – 10% of the total rent (minimum charge $150)
Value Added Tax currently 17% is added to any commission due.
Lawyer’s Fees
Most lawyers charge the equivalent of two weeks rent.
Value Added Tax is added to any commission due.
When Buying a property the following are the costs that must be taken into account:
Real Estate Broker’s Commission
On the purchase or sale of property, brokers customarily charge 2% of the inclusive price of the property.
Value Added Tax is added to any commission due.
Lawyer’s Fees
Most lawyers charge 1% + VAT. (equivalent to 1.17%)
Purchase Tax (Mas Rechisha)
The Purchase Tax in respect of residential dwellings is an incremental (progressive) tax.
In order to calculate the tax, the total purchase price of the dwelling is divided into several levels or brackets and
a different rate of tax is applied to each bracket, as follows:
Bracket 1 is subject to tax at the rate of 0.00%-0.50%
Bracket 2 is subject to tax at the rate of 3.50%
Bracket 3 is subject to tax at the rate of 5.00%
Bracket 4 is subject to tax at the rate of 8.00%
Bracket 5 is subject to tax at the rate of 10.00%
This applies to a Local buyer who does not own another residence in Israel or more then 1/3 parts of a property.
The range of each bracket is adjusted every 3 months in shekel terms in accord with changes to the Israeli Consumer Price Index
and at present is roughly equivalent to the following:
Bracket 1 (0.00%) – First 1,664,520 ns
Bracket 2 (3.50%) – Next 1,664,520 – 1,974,335 ns
Bracket 3 (5.00%) – Next 1,974,335 – 5,093,535 ns
Bracket 4 (8.00%) – Next 5,093,535 – 16,322,055 ns
Bracket 4 (10.00%) – Next 16,978,450 ns and higher
A none Israeli or Israeli buying a second residence will be taxed as followed .
Bracket 1 (8.00%) – 0 – 5,095,570 ns
Bracket 2 (10%) – Next 5,095,570 ns Or more
New Olim
Bracket 1 (0.50%) – First 1,672,385 ns
Bracket 2 (5.00%) – Next 1,672,385 and higher
Tax simulator :
Tax calculator
The information contained on this page is a general guide.
Prospective purchasers must obtain specific legal and professional advice from qualified Israeli legal counsel or tax advisors.