International taxation – relocation and return to Israel

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Many businesses devote considerable attention to reducing the local tax burden in Israel, and tend to devote less attention to reducing the tax burden on their operations abroad, this despite the effective tax rate on such operations often exceed the tax rate in Israel. Without careful planning, profits and revenues from foreign operations are liable to be subject to a high tax burden, to early payment of tax debts and certain sanctions by the various tax authorities which are often liable to harm the economic feasibility of activities and investments abroad.

The International Taxation Department headed by Ishai Etzion provides tax consulting to those investors –incorporated bodies and individuals – who are involved in business operations abroad. And this, after placing emphasis on  developing a comprehensive tax strategy which includes examining the structure of holdings of these bodies and individuals according to the local and international tax laws and tax treaties, the local international tax laws, and tax treaties and this in order to reduce, as far as possible, the total tax burden. In addition to this, the Department provides tax consulting to Israeli resident individuals at the time of relocation abroad and consulting to foreign residents active in Israel.

The International Tax Department’s services include:

Examining the structure of the holdings of companies and individuals, in order to result in tax optimization when there are international activities. The Department has in depth knowledge and experience in the field of tax laws abroad (which often change), as well as alternatives in existing tax benefits granted in Israel and globally.

Examining the structure of the existing holdings with a view to reduce the tax burden applying to foreign factors operating in Israel, with intelligent use of tax aspects granted according to local Israeli laws. Inter alia, at the time of consulting to foreign factors operating in Israel, the location of operations from the tax aspect, and the source of income and tax burden at the time of distributing profits are examined.

Assistances to Israeli residents when submitting tax returns abroad. Israeli residents managing businesses abroad are likely to often require the submission of tax returns to the tax authorities in the countries in which they are active. The International Tax Department has wide experience in the field and provides direction and assistance on the subject, in cooperation with colleagues and firms throughout the country and the world.

Assistance in establishing entities in Israel and in foreign countries. Providing continuing consultations and current accompaniment relating to the structure of international holdings. The Department provides continuous consulting on the subject of executing special transactions, determining transfer prices, structural changes, methodology and timing connected with the distribution of dividends, contacting tax authorities in Israel and abroad in order to obtain pre-rulings, handling the preparation of annual tax returns, etc.

Consulting to Israeli resident individuals when relocating abroad and when returning as returning residents. This while examining the question of residency and the time of discontinuing residency in Israel and providing consulting at the time of the move abroad. Preparation of tax surveys which examine the status of residency of individuals for tax purposes, providing consulting to foreign residents employed in Israel, tax consulting to new immigrants and returning residents, etc.

Tax planning when exercising options and shares by employees and controlling shareholders in corporations in Israel and abroad. The widespread use today of proper compensation of a company’s employees and managers, mainly in high-tech companies, is through allotting options and/or shares of thחe company. This allotment has many tax consequences and aspects, and it is advisable to obtain timely advice regarding them. The Department offers many creative and varied tax solutions, due to its considerable experience in the field.