Purchase Tax Benefits for New Immigrants
Regulation 12A, the period it runs on, the single apartment condition, and the value ceiling above which the relief is not given at all.
David Melnik Law Office, Tel Aviv
An oleh who buys a home in Israel may pay purchase tax at reduced rates. The relief is not automatic and it is not open-ended. It runs on a defined period, it is conditioned on the purchase being of a single apartment, and it disappears entirely above a value ceiling.
The period, measured from first entry to Israel
The relief runs on a period that opens one year before first entry to Israel and closes seven years after it, and it may be used once. First entry is the operative event, not the date printed on the teudat oleh. Years spent in Israel on an A/1 temporary resident visa are therefore already inside the period, and someone who lived here on A/1 and completed aliyah several years later may have far less of it left than the certificate suggests. Compulsory military or national service performed during the period is excluded from the count and pushes the closing date out.
Where a purchase is planned near either end of the period, what remains of it should be measured before the contract is signed. The relief is not available a day after it closes.
The single apartment condition
Since the amendment of August 2024 the relief for a residential apartment sits in Regulation 12A of the Real Estate Taxation Regulations, and it is conditioned on the buyer meeting the single apartment limbs of section 9(c1c)(2) of the Real Estate Taxation Law. The purchase is therefore tested as a single home.
What counts towards the single apartment test
The apartments of a spouse and of children under eighteen are counted together with the buyer’s own. A home held abroad does not enter that count; one held in Israel does. The buyer also declares that the apartment will actually be lived in, and that declaration is examined afterwards rather than at the time. Where the family already owns something here, or a second purchase is contemplated, the order in which the two transactions are signed decides the rate on both.
The rates
Amounts are current as at August 2026. The brackets are updated periodically, so they should be verified against the value on the date the transaction is signed.
| Portion of the purchase price | Rate for an oleh buying a single apartment |
|---|---|
| Up to ILS 1,978,745 | No purchase tax |
| ILS 1,978,745 to ILS 6,055,070 | 0.5% |
| Above ILS 6,055,070 | The ordinary single apartment rates, rising to 8% |
The ceiling
The relief applies only where the value of the apartment does not exceed ILS 20,183,565. Above that figure it is not reduced, it is not given at all.
What the 2024 amendment changed
Before it, an oleh paid 0.5% on the portion up to the first bracket and 5% above it, whether the purchase was of a first home or an additional one. The effect was perverse: the relief did little for an oleh buying a home to live in, and a great deal for one buying an investment property. The amendment moved the relief into Regulation 12A and tied it to the single apartment test, so it now follows the same policy as the rest of the purchase tax regime. An oleh buying an additional apartment pays the ordinary investor rates.
Where this is decided
Three separate dates govern a file opened around aliyah, and they are not the same date. First entry to Israel opens the purchase tax period. The day a person’s life becomes centered here decides residence for income tax. The date on the teudat oleh governs absorption rights and little besides. A contract can fall inside one of those periods and outside another.
David Melnik Law Office has practiced from Tel Aviv since 1996 in property transactions and in the taxation that runs through them. The office acts for olim, for returning residents and for buyers who are not in the country, and stays with the file from the first calculation through to registration.
Telephone: +972-3-620-6444
Email: david@melnik.org.il
Office: Tel Aviv, Israel. Correspondence in English or Hebrew.
Where to go next
- Olim and Returning Residents : the practice area, and what else the move decides.
- Buying Your First Home in Israel : how the purchase itself runs.
- Foreign Residents and Israeli Property : the position for a buyer who is not moving here.