Overview
Voluntary disclosure in Israel is an official process that enables individuals and corporations to declare previously undeclared or unreported income, assets, or financial accounts to the Israeli Tax Authority.
By participating in a voluntary disclosure program, taxpayers can correct historical tax reporting errors, regularize their status, and significantly minimize exposure to criminal prosecution or heavy financial penalties.
Israel has periodically offered voluntary disclosure opportunities, both general and anonymous, aimed at encouraging taxpayers to come forward before enforcement actions are initiated.
Properly managing the voluntary disclosure process can mean the difference between manageable penalties and severe consequences, including criminal investigations.
NEW INCOME TAX VOLUNTARY DISCLOSURE PROCEDURE
The I.T.A. recently published the new Voluntary Disclosure Procedure for income not previously reported in Israel.
Important comments relating to the Tax Amnesty Guidelines:
- Effective immediately until August 31, 2026.
- Provides immunity from criminal proceedings. Information included in rejected applications will also enjoy immunity (criminal and civil).
- Application must include disclosure of all relevant information and must be done in good faith.
- Interest, linkage and certain penalties will be added to the amount of taxes payable.
- Simplified filing for green route applications that include up to NIS 4,000,000 of unreported financial assets at December 31, 2014 and no new deposits/transfers were made during the disclosure period. In addition, unreported residential rental income not exceeding NIS 250,000 annually and limited income and investments in digital currency. The ITA will determine whether the “green” route or regular one will apply.
- Amnesty will not apply (usually):
- Where the ITA or other government agency has specific information or has initiated investigation procedures.
- When income is from illegal activities.
Benefits of Voluntary Disclosure
- Legal Peace of Mind:
By voluntarily coming forward, you regularize your tax affairs, confirm compliance with Israeli tax laws, and protect yourself from potential future audits, investigations, and criminal proceedings. - Protecting Your Family and Future Generations:
Unreported income and undisclosed assets can cause significant issues for heirs. Addressing these matters today prevents deferring the legal and tax problems to the next generation. - Reputation Protection:
Voluntary disclosure helps safeguard your personal and professional reputation by minimizing the risk of public exposure through legal proceedings or media reports related to tax investigations. - Reduced Penalties and Interest Charges:
Israeli authorities typically offer significant penalty relief for taxpayers who voluntarily disclose, compared to harsher penalties imposed during enforcement actions. Interest reductions may also apply, resulting in meaningful savings.
Our Voluntary Disclosure Services
We have successfully filed dozens of voluntary disclosure applications in various routes, as well as many voluntary disclosure type applications to various tax offices and were successful in receiving the same benefits that were available to voluntary disclosure applicants in the past (similar tax agreements were signed).
Broide.com provides full support throughout the voluntary disclosure process, ensuring that you are represented professionally, confidentially, and strategically at every stage.
Our services include:
- Preparation and Submission of Disclosure Applications:
We compile and present your financial information accurately and persuasively to maximize your chances of securing favorable terms with the tax authorities. - Strategic Advice on Disclosure Approach:
Every case is unique. We help you determine the best strategy for timing, documentation, negotiation, and protection based on your specific circumstances. - Representation in Negotiations with Israeli Tax Authorities:
Our experienced team directly handles communications and negotiations, advocating for reduced penalties and optimal settlement outcomes. - Confidentiality and Risk Mitigation:
We ensure strict confidentiality throughout the process and guide you to mitigate any ongoing risks, both financial and legal.
Planning Ahead: Take Control of Your Tax Situation
If you have unreported income, undisclosed assets, or unresolved tax matters, the voluntary disclosure process offers an opportunity to resolve issues under significantly better conditions than if detected later through investigation.
At Broide.com, we offer confidential consultations to assess your eligibility for voluntary disclosure and provide a personalized action plan to protect your interests.
Take the first step toward financial security and peace of mind today.
Contact Broide for a confidential consultation.
NEW INCOME TAX VOLUNTARY DISCLOSURE PROCEDURE
The I.T.A. recently published the new Voluntary Disclosure Procedure for income not previously reported in Israel.
Important comments relating to the Tax Amnesty Guidelines:
- Effective immediately until August 31, 2026.
- Provides immunity from criminal proceedings. Information included in rejected applications will also enjoy immunity (criminal and civil).
- Application must include disclosure of all relevant information and must be done in good faith.
- Interest, linkage and certain penalties will be added to the amount of taxes payable.
- Simplified filing for green route applications that include up to NIS 4,000,000 of unreported financial assets at December 31, 2014 and no new deposits/transfers were made during the disclosure period. In addition, unreported residential rental income not exceeding NIS 250,000 annually and limited income and investments in digital currency. The ITA will determine whether the “green” route or regular one will apply.
- Amnesty will not apply (usually):
- Where the ITA or other government agency has specific information or has initiated investigation procedures.
- When income is from illegal activities.
We are available to assist with applications for voluntary disclosure and clarifications.
These are preliminary comments on the recently published tax directive. We are studying the implications and will advise clients of the details as soon as possible. Do note: Preparatory work for the application is lengthy and should, therefore, be dealt with now.