New immigrants and veteran returning residents who lived abroad for at least 10 years are exempt from Israeli tax on foreign-sourced income for 10 years, including dividends, interest, rent and capital gains from abroad. Those who became residents before 2026 were also exempt from reporting that income; under Amendment 272, residents from 1 January 2026 must report it, although it stays tax-exempt.
New immigrants ("Olim Chadashim") and Returning Residents (who lived abroad for 10+ years) are entitled to:
New in 2026: a temporary provision gives new immigrants and veteran returning residents who became residents between 5 November 2025 and 31 December 2026 a capped exemption on income from work in Israel. See Do new immigrants to Israel pay tax on foreign income? for the details.
If an Oleh Chadash establishes a foreign company but manages it entirely from Israel, the Israeli Tax Authority might claim the company is an "Israeli Resident" due to Management and Control rules, potentially bypassing the exemption. Proper structuring is vital.
Foreign-sourced passive and active income: dividends from foreign companies, interest from foreign banks, rent from property abroad, capital gains on foreign assets, and salary for work physically performed abroad.
It depends on when you became a resident. The reporting exemption applied to earlier arrivals; Amendment 272 cancels it for anyone who becomes an Israeli resident from 1 January 2026.
Yes. If the company is managed and controlled from Israel, the Tax Authority may treat it as an Israeli resident company, so its income would no longer be foreign-sourced. The structure needs to be planned in advance.
New immigrants (olim) and senior returning residents, under the conditions in section 14 of the Income Tax Ordinance. The holiday covers certain foreign-source income for ten years. Reporting requirements and the exact scope have changed over time, so it is worth confirming your position with an Israeli CPA.