Selling an apartment in Israel without living there is entirely possible — but it is a three-layer operation: contractual, tax and banking. Many foreign sellers discover too late that the negotiated price is not the amount that will reach their account, nor on the date they imagined. Here is how it actually works.
I. Selling remotely: the power of attorney comes first
You are not required to be present in Israel. But your representative must hold an impeccable authority.
Two routes exist:
- a notarised power of attorney (Yipouy Koach Notarioni (ייפוי כוח נוטריוני)) signed before a notary abroad, then apostilled and translated;
- a power of attorney signed directly at an Israeli consulate.
Two points of caution: the power of attorney must list precisely the authorised acts (signing the contract, receiving funds, filing declarations, discharging the mortgage, registering at the Tabu) — an overly general power is regularly rejected — and preparing it takes one to two weeks. Start it before the negotiation, not after.
II. Filings: a short and mandatory deadline
The sale must be declared to the Israel Tax Authority (Rashout HaMissim (רשות המסים)) within 30 days of signing the contract. That deadline runs even if the price has not yet been paid.
The non-resident seller must also anticipate two difficulties:
- The main-residence exemption is not a given. The favourable regime for a “dira yechida” (דירה יחידה) is subject to strict conditions, and owning a home abroad may be held against the seller. An ill-founded exemption claim exposes you to a reassessment.
- Computing Mas Shevah (מס שבח) (capital gains tax) requires reconstructing the historic acquisition price and the deductible expenses: notary fees, professional fees, agency commission, documented works. Without supporting documents, those amounts are lost.
III. Withholding at source: the most poorly anticipated point
This is where the surprise is most frequent. Where the seller is a non-resident, the buyer — in practice the buyer’s lawyer — must withhold a portion of the price and remit it directly to the tax authority, as security for the capital gains tax.
The only way to avoid this is to obtain, in advance, a withholding exemption certificate (Ishur Nikuy BaMakor (אישור ניכוי במקור)) from the authority.
- With the certificate: the price is paid to you in full.
- Without it: a substantial share of the price stays blocked, sometimes for months, until the tax is finally assessed and the excess refunded.
For a seller relying on those funds to finance another project, the cash-flow gap is considerable.
IV. Releasing the Tabu, then transferring the funds
The transfer of ownership will be registered at the Tabu (טאבו) only once you have gathered:
- the municipal certificate (Ishur Iriya (אישור עירייה)), confirming payment of the municipal tax (Arnona (ארנונה)) and, where applicable, of the betterment levy (Heitel Hashbaha (היטל השבחה));
- the tax certificates relating to Mas Shevah and Mas Rechisha (מס רכישה);
- the discharge of any mortgage (Mashkon (משכון)) encumbering the property.
Then comes the repatriation. Israeli banks apply rigorous compliance procedures: they will require the source of funds, the tax certificates and often a tax compliance attestation. On the other side, the sale must be declared in accordance with the applicable double tax treaty, which as a rule allocates the taxation of real estate gains to the State where the property is located, while organising the elimination of double taxation. Coordination between the two filings must be planned upfront.
Conclusion – Why work with a lawyer specialised in Israeli and international real estate law?
Selling from abroad means making two legal and tax systems, two administrations and two banks talk to each other. A badly drafted power of attorney delays signature; a late filing generates penalties; the absence of an exemption certificate freezes a substantial share of the price.
A lawyer secures the whole chain: drafting the power of attorney, computing and negotiating the capital gains base, applying for the withholding exemption, obtaining the municipal certificates, registering at the Tabu, and articulating all of it with your reporting obligations at home.
It is with this in mind that the Firm ABITBOL & ASSOCIES, drawing on its expertise in Israeli and international real estate law, supports its clients at every stage of the sale of their property from abroad. Our lawyers ensure that your interests are protected and that every step is carried out in complete security.
13 Av Hubert Germain – Paris 16ᵉ
Tel: + 33 (0)1 78 90 03 73
Fax: + 33 (0)1 77 74 63 99
13 rue Shimon ben Shetah, 9414713, Jérusalem
Tel: + 972 (0)2 595 63 45
Fax: + 972 (0)2 591 63 26
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