What Is the Capital Gains Tax Rate in Israel? Up to 25%
Israel taxes an individual’s real capital gain accrued since 2012 at up to 25%, or 30% for a substantial shareholder, on the Israel Tax Authority’s 2025 notes.
Israel taxes an individual’s real capital gain accrued since 1 January 2012 at up to 25%, the Israel Tax Authority states in its Form 1399 notes for the 2025 tax year. A substantial shareholder selling a security pays 30% on the same part of the gain. Older parts of a gain carry their own rates. A separate surtax applies above NIS 721,560 of taxable income in 2026.
| Figure | What it counts | Period |
|---|---|---|
| Up to 25% | Rate on an individual’s real capital gain accrued from 1 January 2012 | Tax year 2025 |
| 30% | Rate for a substantial shareholder selling a security, on real gain accrued from 1 January 2012 | Tax year 2025 |
| Up to 20% | Rate on real gain accrued from 1 January 2003 to 31 December 2011 | Tax year 2025 |
| 10% | Rate on the “liable inflationary amount” | Tax year 2025 |
| 3% | Surtax on taxable income above NIS 721,560 a year | Tax year 2026 |
| 2% | Further surtax on taxable income from capital sources above NIS 721,560 a year | Tax year 2026, in force since 2025 |
| 10 years | Exemption for new immigrants and veteran returning residents on gains on assets abroad | Information valid for 2026 |
Source: Israel Tax Authority. Form 1399 explanatory notes, tax year 2025; withholding booklet for salary and wages, updated April 2026; “Considering Aliyah?” leaflet, 2026.
Israel taxes real capital gains at up to 25%
The Israel Tax Authority states a rate of up to 25% on the part of an individual’s real capital gain accrued from 1 January 2012, for the 2025 tax year. The notes write it as “up to 25%”, so 25% is the ceiling for that part of the gain. The rate applies to the real gain on a sale under section 91 of the Income Tax Ordinance. The liable inflationary amount is taxed on its own, at 10%.
| Part of the gain | Rate | Seller |
|---|---|---|
| Real gain accrued from 1 January 2012 | Up to 25% | An individual |
| Real gain accrued from 1 January 2012, on a security | 30% | A substantial shareholder |
| Liable inflationary amount | 10% | An individual |
Source: Israel Tax Authority, Form 1399 explanatory notes, tax year 2025.
The 10% applies to the liable inflationary amount only. It does not apply to the gain as a whole.
A substantial shareholder selling a security pays 30%
A substantial shareholder selling a security pays 30% on real gain accrued from 1 January 2012, the Israel Tax Authority states in its Form 1399 notes for the 2025 tax year. The part of the same gain accrued from 1 January 2003 to 31 December 2011 is taxed at 25%. “Substantial shareholder” is a term defined in the Income Tax Ordinance, and the Form 1399 notes do not print its definition.
- From 1 January 2012: 30% for a substantial shareholder selling a security. Other individual sales pay up to 25%.
- From 1 January 2003 to 31 December 2011: 25% for a substantial shareholder selling a security. Other individual sales pay up to 20%.
- Up to 31 December 2002: the individual’s marginal income tax rate.
Gains are split by period, at 20% for 2003 to 2011
Real gain is taxed by the period in which it accrued, the Israel Tax Authority states in its Form 1399 notes for 2025. A gain on an asset bought before 2012 is divided into slices, and each slice is taxed at its own rate. The notes print a rate for each slice and no blended rate for the whole gain.
| Period in which the gain accrued | Individual | Substantial shareholder selling a security |
|---|---|---|
| From 1 January 2012 | Up to 25% | 30% |
| 1 January 2003 to 31 December 2011 | Up to 20% | 25% |
| Up to 31 December 2002 | Marginal income tax rate | Marginal income tax rate |
Source: Israel Tax Authority, Form 1399 explanatory notes, tax year 2025.
The oldest slice is taxed under the income tax brackets, so its rate depends on the seller’s income.
Surtax adds 3%, and 2% more on capital income, above NIS 721,560
An additional 3% applies on taxable income above NIS 721,560 a year for the 2026 tax year, the Israel Tax Authority states in its withholding booklet updated April 2026. Since 2025, a further 2% has applied on taxable income from capital sources above the same threshold. Both are charges on taxable income above the threshold. Neither appears as a rate for a capital gain.
- Additional 3%: on all taxable income above NIS 721,560 a year, or NIS 60,130 a month, tax year 2026.
- Further 2%: on taxable income from capital sources above the same NIS 721,560 threshold, tax year 2026, in force since 2025.
- Indexation: the booklet states that most amounts were not updated for inflation for 2025 to 2027.
Neither the booklet nor the Form 1399 notes prints a combined capital gains rate that includes the surtax. The rates in the earlier sections are for tax year 2025, and the surtax figures are for tax year 2026.
New immigrants pay no tax on foreign gains for 10 years
New immigrants and veteran returning residents are exempt for 10 years on income earned abroad, including capital gains on assets abroad, the Israel Tax Authority states in its 2026 leaflet for new immigrants. A veteran returning resident is an Israeli resident who lived abroad for more than 10 years. Arrivals from 1 January 2026 keep the tax exemption, but they have to report that income.
| Who | What is exempt | For how long |
|---|---|---|
| New immigrants | All income earned abroad, including capital gains on assets abroad | 10 years |
| Veteran returning residents, abroad more than 10 years | The same | 10 years |
| Returning residents, abroad six years | Non-business income from abroad | 5 years |
| Arrivals up to 31 December 2025 | Reporting of foreign income and foreign assets | 10 years |
Source: Israel Tax Authority, “Considering Aliyah? Here Are Some Benefits You May Be Eligible For”, information valid for 2026.
The Form 1399 notes for 2025 set out the same exemption for an asset held outside Israel:
- Sold within 10 years of becoming an Israeli resident: the gain is exempt.
- Sold after 10 years: the part of the real gain accrued up to the end of those 10 years remains exempt.
- A separate 5-year benefit for arrivals from 5 November 2025 covers income earned in Israel from work. The leaflet states that it does not cover capital gains.
The Tax Authority prints no combined rate for these charges
- The Israel Tax Authority published the period rates and the surtax in separate documents, for tax years 2025 and 2026. Neither document prints a total.
- Each period rate applies only to its own slice of a gain. The rates are not averaged into one figure.
- The surtax is a separate charge on taxable income above NIS 721,560. It is not added to the 25%, the 30% or the 20%.
- “Up to 25%” and “up to 20%” are ceilings and stay ceilings.
- The Form 1399 notes cover individuals selling under section 91. The sale of rights in land is taxed under the Real Estate Taxation Law, covered separately in tax on property sales. This page carries no corporate rate and no separate rate for bonds.
Questions readers ask
Is Israel’s capital gains tax 25% for everyone?
No. The Israel Tax Authority states “up to 25%” for the part of an individual’s real gain accrued from 1 January 2012, in its Form 1399 notes for 2025. A substantial shareholder selling a security pays 30% on that part, and older parts of a gain carry other rates.
Is the tax charged on the whole profit?
The Israel Tax Authority states that the rates apply to the real capital gain, in its Form 1399 notes for 2025. The liable inflationary amount is taxed separately, at 10%.
What rate applies to the liable inflationary amount?
The Israel Tax Authority states a rate of 10% on the liable inflationary amount for the 2025 tax year. The 10% does not apply to the gain as a whole.
How is gain from before 2003 taxed?
The Israel Tax Authority states that real gain accrued up to 31 December 2002 is taxed at the individual’s marginal income tax rate, in its Form 1399 notes for 2025.
What rate applies to gain accrued from 2003 to 2011?
The Israel Tax Authority puts it at up to 20% for an individual, and 25% for a substantial shareholder selling a security, for the 2025 tax year.
Who counts as a substantial shareholder?
The term is defined in the Income Tax Ordinance. The Israel Tax Authority published the 30% rate in its Form 1399 notes for 2025, and those notes do not print the definition.
Do high earners pay more on capital gains?
The Israel Tax Authority states an additional 3% on taxable income above NIS 721,560 a year for 2026. A further 2% has applied since 2025 on taxable income from capital sources above the same threshold.
What is the surtax threshold per month?
The Israel Tax Authority puts it at NIS 60,130 a month for the 2026 tax year, in its withholding booklet updated April 2026. That is NIS 721,560 a year.
Is there one combined rate for a large gain?
The Israel Tax Authority publishes no combined capital gains rate in its Form 1399 notes or its 2026 withholding booklet. The surtax is a separate charge on taxable income above the threshold.
Does the 25% apply to selling a home?
The Israel Tax Authority issued Form 1399 for sales under section 91 of the Income Tax Ordinance. The sale of rights in land is taxed under the Real Estate Taxation Law.
What rate do companies pay on capital gains?
The Israel Tax Authority issued Form 1399 for individuals only, and this page carries no corporate rate.
Do new immigrants pay tax on selling assets abroad?
The Israel Tax Authority states that new immigrants are exempt for 10 years on income earned abroad, including capital gains on assets abroad, in its 2026 leaflet.
What happens if a new immigrant sells a foreign asset after 10 years?
The Israel Tax Authority states, in its Form 1399 notes for 2025, that the part of the real gain accrued up to the end of those 10 years remains exempt.
Do immigrants arriving in 2026 still have to report foreign gains?
Yes. The Israel Tax Authority states that arrivals from 1 January 2026 keep the 10-year tax exemption but have to report the income. Arrivals up to 31 December 2025 are also exempt from reporting.
Does the new 5-year benefit for recent arrivals cover capital gains?
No. The Israel Tax Authority states that the additional benefit for arrivals from 5 November 2025 covers income earned in Israel from work, and not passive income such as capital gains.
How long is the exemption for returning residents?
The Israel Tax Authority states 10 years for residents who lived abroad for more than 10 years. Residents who lived abroad for six years are exempt for 5 years on non-business income from abroad.
Sources
- Israel Tax Authority, 2026. Considering Aliyah? Here Are Some Benefits You May Be Eligible For. Spokesperson and Public Information Unit, English leaflet, information valid for 2026. https://www.gov.il/BlobFolder/generalpage/new-immigrants-france-081026/he/IncomeTax_new-immigrants-english-081026.pdf. Official or primary record.
- Israel Tax Authority, 2026. Form 1399 (individual): Notice of Sale of an Asset and Calculation of the Tax Due, Tax Year 2025, explanatory notes. Annual report forms for tax year 2025, Hebrew. https://www.gov.il/BlobFolder/service/reporting-and-payment-2025-annual-tax-report-for-individuals/he/Service_Pages_Income_tax_annual-report-2026_1399y-2025.pdf. Official or primary record.
- Israel Tax Authority, 2026. Withholding Tables for Income Tax on Salary and Wages from January 2026, updated April 2026. Assessment and Audit Division, Hebrew. https://www.gov.il/BlobFolder/generalpage/income-tax-monthly-deductions-booklet/he/generalInformation_income-tax-monthly-deductions-booklet_monthly-deductions-booklet-2026.pdf. Official or primary record.
