A significant tax benefit has been approved for new Olim and certain Toshavim Chozrim arriving in Israel during a specific eligibility window. The benefit provides a graduated tax exemption for up to 5 years from your Aliyah date within that window.

Critical to understand: This reform does not cancel existing benefits—you still receive tax credit points and the 10-year exemption from tax on foreign income (detailed below

You qualify for these benefits if you are:

• A new Oleh/Olah
• A Toshav Chozer who lived abroad for at least 10 consecutive years

And you made Aliyah or returned to Israel between November 5, 2025 and December 31, 2026.

The tax benefits apply exclusively to "eligible income earned through personal effort", which includes:

• Salary from employment
• Business income (self-employed/freelance work)

The benefit does not apply to passive income such as:

• Rental income
• Accrued interest
• Dividends

The exemption applies to qualifying income received in Israel during tax years 2026–2030, up to predetermined maximum amounts detailed be

The exemption operates on a graduated scale with the following ceilings:

• 2026: up to 600,000 NIS
• 2027-2028: up to 1,000,000 NIS per year
• 2029: up to 350,000 NIS
• 2030: up to 150,000 NIS

Please note: The exemption is granted for up to 5 years, covering the period from 2026 through 2030 regardless of when you arrive. Whether you arrive in November 2025 or December 2026, the exemption applies only to these specific tax years. This means that if you arrive earlier in the eligibility window, you receive more total benefit

If you work for a family member or related party, the exemption is limited to a lower ceiling:

• Up to 140,000 NIS per year (for all years 2026–203

To prevent individuals from making Aliyah solely to exploit the tax benefit and then leaving Israel, the following safeguard exists:

You will lose eligibility for the reform provisions if:

• You leave Israel and cease to be an Israeli tax resident in 2028 or 2029
• You spend fewer than 75 days in Israel during 2028 and 2029 respectively

In addition to the new exemption, the following existing benefits remain fully in effect:

Tax Credit Points
1–3 tax credit points for approximately 4.5 years (Worth approximately 3,000–9,000 NIS per year in tax savings)

Ten-Year Exemption on Foreign Income
Tax exemption on income from abroad for 10 years from your aliyah date

Applies to various types of foreign-source income including:

• Foreign employment income
• Dividends and interest from foreign investments
• Capital gains from foreign assets
• Foreign rental income
• Foreign pension distribution

Starting in 2026, income from abroad is subject to reporting

What this means:

• Even though foreign income remains tax-exempt for 10 years, you must now report it on your annual Israeli tax return
• This represents a significant change from previous years when Olim were exempt from both tax and reporting on foreign income

Action required: You must file annual tax returns declaring all worldwide income and assets, even if that income is not taxed in Israel.

The Misrad Ha’Aliyah VeKlita - משרד העליה וקליטה - Ministry of Aliyah and Integration, through the Entrepreneurs Division, offers a Business Information telephone line that provides information about taxes for new Olim and Toshavim Chozrim.

Business Information Line
Hours: 24 hours a day (except Shabbat and holidays)

Contact options:

• From Israel: Dial 2994*
• From overseas: Call +972-3-9733333
• Email: infobiz@014.net.il