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Until now, new immigrants were not subject in Israel to any tax obligation on income from foreign sources. As of 1 January 2026, changes are to be expected.<\/p>\n
For aliyah carried out from 1 January 2026 onward, new immigrants will henceforth be required to declare their worldwide income to the Israeli Tax Authority, and no longer only income from Israeli sources.<\/p>\n
Nevertheless, only income from Israeli sources will remain taxable in Israel. Other income from foreign sources will continue to be exempt from taxation in Israel during the first ten years following aliyah.<\/p>\n
From the perspective of the Israeli Tax Authority, the objective is to strengthen the automatic exchange of information between tax administrations. It will now have the ability to verify the proper classification of the source of income.<\/p>\n
Indeed, income generated from Israel, even if the debtor is foreign, will remain taxable in Israel.<\/p>\n
Accordingly, from the taxpayer\u2019s standpoint, increased vigilance will be required with respect to the source of income.<\/p>\n
By way of example, a professional activity\u2014whether self-employed or salaried\u2014carried out from Israel for the benefit of a client or employer based in France will, in principle, be taxable in Israel, as it constitutes Israeli-source income, subject of course to the applicable tax treaty provisions.<\/p>\n
These legislative changes will also impact Israeli asset declarations, which will now include foreign assets, whereas this was not previously the case.<\/p>\n
It should be noted that all of these legislative developments are intrinsically linked to tax residency. Accordingly, aliyah should not give rise to such international tax obligations where no tax residency in Israel can be established.<\/p>\n
Furthermore, with a view to encouraging long-term settlement in Israel, a draft bill is currently under consideration to ease the tax burden on new immigrants during the first years of integration, which are generally the most critical.<\/p>\n
Thus, in addition to the tax benefit inherent in the exemption from Israeli taxation on income from foreign sources, new immigrants making aliyah during the year 2026 may also benefit from an income tax exemption on so-called active income from Israeli sources, up to a limit of one million shekels.<\/p>\n
For two years (2026 and 2027), this exemption would be total; thereafter, it would become progressive but would nevertheless remain substantial in the years that follow.<\/p>\n
It should be specified that income exceeding this threshold\u2014which we naturally wish you\u2014may be optimized, as income tax is progressive after taking into account tax benefits related to the household\u2019s personal circumstances.<\/p>\n
It should also be noted that this additional tax benefit, aimed at stimulating the Israeli economy, will apply only to so-called active income, thereby excluding passive income such as rental income, investment income, and similar categories.<\/p>\n
Likewise, this benefit will apply only to relocations to Israel carried out during the year 2026. Later relocations will benefit solely from the preferential tax regime providing a ten-year exemption from Israeli taxation on income from foreign sources.<\/p>\n
Consequently, and in light of these extremely favorable tax levers for settling in Israel, the Abitbol Firm will be pleased to assist you in both the planning and the realization of your project, which we already wish to be successful.<\/p>\n
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13 Av Hubert Germain – Paris 16\u1d49
\nTel: + 33 (0)1 78 90 03 73
\nFax: + 33 (0)1 77 74 63 99<\/p>\n
13 rue Shimon ben Shetah, 9414713, J\u00e9rusalem
\nTel: + 972 (0)2 595 63 45
\nFax: + 972 (0)2 591 63 26<\/p>\n