There is no form that ends Israeli tax residency. You stop being a resident when your center of life has actually moved abroad: your home, your family, your work and your money. The day-count presumptions can still pull you back in, the year you leave can trigger exit tax under section 100A, and National Insurance makes its own decision separately.
The short answer: you cannot notify the Israel Tax Authority that you have left. You stop being an Israeli tax resident when your life has actually moved somewhere else, and you then have to be able to show it. Until that happens, Israel keeps taxing your income from anywhere in the world. Once it happens, Israel generally taxes only income that comes from Israel.
This guide is for people relocating out of Israel: olim who are heading back, Israelis taking a job overseas, and families splitting time between two countries. It covers how residency is decided, what you file, what leaving can cost, and why National Insurance is a separate conversation.
The Income Tax Ordinance defines an Israeli resident as someone whose center of life is in Israel. There is no formula. The Tax Authority looks at the full picture of your family, economic and social ties, including:
Two people can spend the same number of days abroad and get opposite answers. If you moved with your spouse and kids, rented a home, started working locally and registered as a tax resident there, your center of life has probably moved. If you work abroad but your family stayed in the apartment in Ra'anana, it probably has not.
On top of the center of life test, the Ordinance sets two presumptions. Your center of life is presumed to be in Israel for a tax year if:
Any part of a day counts as a day. As of this writing, both presumptions can be rebutted, by you or by the tax assessor. In practice that means counting days is not enough on its own. Someone under 183 days can still be a resident if the ties stayed in Israel, and someone who trips the 425-day rule because of long family visits can still show that their life is elsewhere.
Keep a running log of your days in Israel for every year, backed up by flight bookings or entry and exit records, and hold on to it for at least three years. That is exactly what the assessor will ask for if your status is ever questioned.
If a day-count presumption applies to you but you take the position that you were not a resident that year, you attach Form 1348 to your annual return (Form 1301). It is not filed on its own. On it you list your days in Israel for the year and the two years before, name the country where you are now a tax resident, and attach a certificate of residence from that country. The form also asks about the classic ties: property you own in Israel and whether it is rented out, where your spouse and children live and go to school, your bank accounts and pension savings, your health fund membership and National Insurance payments.
Filing Form 1348 records your position. It is not an approval, and the assessor can still decide you were a resident. Even if you do not need the form, check whether you still have to file a return in Israel, for example because you kept renting out your apartment here. Our guide to tax on rental income in Israel covers that case.
Your new country may treat you as a resident from the day you arrive while Israel still treats you as one too. If Israel has a tax treaty with that country, the treaty's tie-breaker rules decide where you are resident for treaty purposes, usually by looking at your permanent home first and then your center of vital interests. This is one more reason to make the facts on the ground clear and consistent.
The day you stop being a resident is a tax event. Under section 100A of the Ordinance, you are treated as if you sold your assets the day before your residency ended. Gains that built up while you lived in Israel, such as on shares, a stake in a private company or investment funds, can become taxable even though you sold nothing.
You generally have two choices:
Assets that would be exempt if a resident sold them are generally exempt here too. Employee options under section 102 and Israeli real estate have rules of their own. We go through these choices in more detail in our guide to relocation and exit tax under section 100A, and if you hold equity awards, see our guide to section 102 trustee plans.
A company is an Israeli resident if it was incorporated here, and also if it is controlled and managed from Israel. Moving yourself abroad does not move the company. If you keep running it, think about where decisions get made and where profits will be taxed. If the company has retained earnings, decide before you leave when and how you will take them out; our guide to how dividends from an Israeli company are taxed is a good starting point.
Bituach Leumi does not follow the Tax Authority's decision, and the Tax Authority does not follow Bituach Leumi's. You can be a non-resident for income tax and still a resident for National Insurance, or the other way around.
Residency decisions shape your taxes for years, and they are much easier to plan before the move than to defend after it. If you are relocating and want to understand where you stand, book a consultation call with our English-speaking team, or call +972-52-448-5784. We handle Israeli tax and accounting only. We are not a US CPA firm.
No. Residency is a question of fact. If a day-count presumption applies to you but you claim you are no longer a resident, you attach Form 1348 to your annual return and explain why. The tax assessor can still disagree.
No. The presumptions work in both directions. If your spouse, children, home or main business are still in Israel, you can be treated as a resident even after a year spent mostly abroad.
It can. Under section 100A, someone who stops being a resident is treated as having sold their assets the day before. You can generally pay that tax at once or defer it until the asset is actually sold.
No. Bituach Leumi runs its own residency review, looks at the whole family, and can reach a different answer. Ending your residency there can also affect health coverage and benefits.