Estate Planning in Israel for Foreign Nationals: Wills, Trusts, and the Enduring Power of Attorney

Most people with ties to Israel think about estate planning only once something has already gone wrong — a parent loses cognitive capacity, a sibling dies without a will, or a property sits frozen in probate while heirs overseas scramble to understand the process. The Israeli legal system has workable tools for all of these situations, but those tools must be set up in advance to be effective. An Israeli will drawn up correctly prevents a years-long probate fight. A deposited Enduring Power of Attorney avoids the slower and more expensive route of court-appointed guardianship. A properly structured trust can bypass probate entirely for certain assets.

This guide covers the full toolkit available for estate planning in Israel when one or more parties — the asset owner, the heirs, or both — are foreign nationals. It is designed for the diaspora family with an Israeli apartment, the American expat who has built a life in Tel Aviv, and the European investor who owns Israeli real estate but lives abroad.

1. Why Estate Planning in Israel Matters More for Foreigners

Israeli law automatically governs all property located within Israel, regardless of the owner's nationality or country of residence. This means that if you own an apartment in Tel Aviv, a bank account at Bank Hapoalim, or shares in an Israeli company, the Israeli Succession Law 1965 (Chok HaYerusha) applies to how that asset passes on your death — even if you live in New York, London, or Paris and have never set foot in an Israeli court.

For foreign heirs, this creates several complications that proper planning can eliminate or reduce:

• Separate Israeli probate is required. A foreign probate order, even from a country with a treaty with Israel, does not automatically transfer Israeli-situated assets. Heirs must open a separate Israeli inheritance proceeding. A valid Israeli will dramatically simplifies this process; dying intestate (without any will) or with only a foreign will makes it significantly more complex.
• Israeli banks freeze accounts on death. As soon as an Israeli bank learns of a customer's death, it freezes all accounts until the heirs can present a succession order or probate order issued by an Israeli authority. This can take many months and leaves the estate unable to pay ongoing costs like mortgage instalments, property maintenance, or utility bills.
• Incapacity without planning means court guardianship. If a foreign national who owns Israeli assets loses mental capacity — through dementia, accident, or illness — and has not made and deposited an Israeli Enduring Power of Attorney, the only way to manage their Israeli assets is through a full guardianship application to the Israeli Family Court. This is slow, expensive, and public.
• Capital gains tax applies on inherited property sales. Israel has no inheritance tax, but when heirs eventually sell inherited Israeli real estate, they may face capital gains tax (*mas shevach*). Proper planning can structure the timing of transfers to minimise this exposure.

2. Wills in Israel: The Foundation of Estate Planning

An Israeli will is the most basic — and most important — estate planning instrument for anyone with Israeli assets. Israeli law recognises four types of will under the Succession Law 1965: the handwritten will, the witnessed will (signed before two witnesses), the authority will (made before an authorised authority, typically a court registrar or notary), and the oral will (for specific emergency situations).

For most foreign nationals, the recommended form is the witnessed will or the authority will. The witnessed will is straightforward and flexible; the authority will carries additional formal weight. A holographic (entirely handwritten) will is also valid but easier to contest if the handwriting is disputed.

Key points for foreigners making an Israeli will:

• The will should be drafted in Hebrew (or accompanied by an official Hebrew translation) so that the Registrar of Inheritance can process it without delay.
• Israeli wills cover Israeli-situated assets only. A separate foreign will should deal with assets in each other relevant country.
• The will must be kept somewhere it can be found — ideally deposited with the Registrar of Inheritance or with your Israeli attorney, with heirs informed of its location.
• Wills can be updated at any time. A later will revokes an earlier one to the extent of inconsistency.

For a detailed treatment of Israeli will requirements, see our guide on Israeli Will Requirements: How to Write a Valid Will in Israel.

3. Trusts in Israel: When and How They Help

Israel's Trust Law 1979 (Chok HaNe'emanut) provides a statutory framework for trusts created by deed, by will, or by law. An Israeli trust is an arrangement in which a trustee holds property for the benefit of one or more beneficiaries, subject to the terms set by the settlor (the person who creates the trust). This is broadly similar to Anglo-American trust law, though with some Israeli-specific characteristics.

Trusts are not the right tool for every situation, but they offer genuine advantages for foreign nationals with larger or more complex Israeli estates:

Avoiding probate on trust-held assets

Assets held in trust do not form part of the settlor's probate estate. On the settlor's death, the trustee simply continues to administer the trust according to its terms — no succession order is required for trust-held assets. For a foreign family with an Israeli property, transferring the property into a properly structured trust during the owner's lifetime means heirs abroad never need to engage with Israeli probate courts for that asset.

Privacy

Israeli wills and succession orders become part of the public record when filed with the Registrar of Inheritance. Trusts are private documents — their terms are not disclosed to the public, which is valuable when the estate is significant or family relationships are complex.

Asset protection and management

A trustee — which can be an individual or a licensed Israeli trust company — manages trust assets according to the trust deed. This is useful where the intended beneficiaries are minors, live abroad and cannot manage Israeli assets directly, or where the settlor wants to impose conditions (such as maintaining a property for use by family members rather than selling it).

Tax considerations for trusts with foreign parties

Israeli trust taxation is a specialist field that intersects with the home-country tax rules of the settlor and beneficiaries. The Israeli Income Tax Ordinance has a specific chapter on trust taxation, and the rules differ depending on whether the settlor and beneficiaries are Israeli residents or foreign residents. Broadly, a trust created by a foreign resident settlor for foreign resident beneficiaries (with no Israeli-resident beneficiaries) is taxed on Israeli-sourced income only. However, the rules are complex and change periodically — always obtain specific tax advice before establishing a trust.

4. The Israeli Enduring Power of Attorney: Planning for Incapacity

The most significant development in Israeli estate planning in recent years is the Enduring Power of Attorney (*Yipuy Koach Mitmashekh*), introduced by a 2016 amendment to the Legal Capacity and Guardianship Law 1962. This instrument allows a mentally competent adult to appoint one or more attorneys-in-fact to manage their affairs — financial, personal, or both — if and when they lose mental capacity in the future.

The Enduring POA is fundamentally different from the general power of attorney (POA) discussed in our guide on Israeli powers of attorney. A regular POA becomes void when the principal loses mental capacity — which is precisely the moment when a substitute decision-maker is most needed. The Enduring POA, by contrast, is specifically designed to take effect only at the point of incapacity, or to survive incapacity if already in effect.

Why it matters for foreign nationals

Consider a common scenario: an 80-year-old diaspora parent owns an apartment in Haifa. They develop dementia while living in London. Without an Enduring POA, nobody can legally manage the Haifa property — paying maintenance fees, dealing with tenants, or eventually selling it — until a court appoints a guardian. That process requires an application to an Israeli Family Court, medical evidence, a home study, and ongoing court supervision. It can take a year or more and requires Israeli legal representation.

With a deposited Enduring POA, the appointed attorney-in-fact can step into the role once the principal can no longer understand the matter and the attorney-in-fact has filed a declaration with the Administrator General, managing Israeli assets without a guardianship application (though selling real estate still needs prior approval from the Administrator General or the court).

Requirements for a valid Enduring POA

• Trained attorney. The Enduring POA must be signed before an Israeli attorney who has completed the training required by regulations under the law and has no personal interest in the document. Not all Israeli attorneys have completed this training, so verify before engaging anyone.
• Principal's presence and understanding. The principal must sign the document in person before the trained attorney, who explains it without the attorney-in-fact present and certifies that the principal understands the document and is acting freely.
• Deposit. The Enduring POA can take effect only after it is deposited with the Israeli Administrator General and Official Receiver (*HaApotropus HaKlali*). Without deposit, it cannot enter into force (a medical-only POA that is not deposited remains valid for one year).
• Triggering mechanism. The document can specify how incapacity is determined (by default an expert opinion, and never the attorney-in-fact's decision alone), after which the attorney-in-fact files a declaration with the Administrator General. For property matters only, an immediate effect option is also available.

What the attorney-in-fact can and cannot do

The scope of authority is defined by the document itself and can cover financial matters (bank accounts, property, investments), personal matters (living arrangements, care decisions), or both. Certain acts require explicit authorisation in the document, for example gifts, donations and loans to named recipients (up to a cumulative NIS 100,000) and transactions worth NIS 100,000 to NIS 500,000. Some acts, such as selling or mortgaging real estate or transactions above NIS 500,000, also require prior approval from the Administrator General or the Family Court even with explicit authorisation, and some, such as making or changing a will, can never be delegated.

For foreign nationals making an Enduring POA from abroad

The rule is that you sign the Enduring POA in person before the trained Israeli attorney, who must personally explain the document and confirm your understanding and free will; a foreign lawyer, notary or consul cannot take that attorney's place. The Administrator General has at times issued temporary emergency arrangements allowing signing by video conference under strict conditions, so ask whether any such arrangement currently applies. Visiting Israel specifically for this purpose is strongly recommended for anyone with significant Israeli assets. Some Israeli attorneys are willing to travel abroad for this purpose in limited circumstances, though deposit still occurs in Israel. Note also that under Section 77(b) of the Legal Capacity and Guardianship Law, the validity and scope of the Enduring POA are governed by the law of your domicile (centre of life) on the date you make it, so coordinate the document with advice in your home country.

5. Medical Directives: Your Healthcare Decisions in Writing

The Dying Patient Law 2005 (*Chok HaCholet HaGoses*) gives every person in Israel the right to prepare a medical directive specifying their wishes for end-of-life medical treatment. The directive is addressed to treating physicians and covers decisions such as whether to apply life-prolonging treatment, resuscitation, and palliative care preferences when the person can no longer communicate.

A medical directive under Israeli law:

• Is filed online through the Ministry of Health's official portal and registered in a national database that all Israeli hospitals can access
• Remains valid for five years and can be renewed or revoked at any time while the person has capacity
• Can appoint a healthcare proxy (*Memuneh Refu'i*) who makes decisions in areas not explicitly covered by the directive
• Applies only when the person has been diagnosed as a "terminally ill patient" as defined by the law — that is, with a life expectancy of six months or less from an incurable condition

For foreign nationals who spend time in Israel or own property here, registering a medical directive is a simple precaution. Israeli hospitals will not have access to a foreign advance directive, but they will have access to a registered Israeli one through the national database.

The Enduring POA can also include a personal care component covering non-end-of-life medical decisions — routine healthcare, living arrangements, and care choices — which the medical directive does not address.

6. Cross-Border Estate Planning: US, UK, and European Nationals

Foreign nationals do not face just Israeli estate planning concerns — they must coordinate their Israeli planning with the rules of their home country. The interaction between Israeli and foreign legal systems creates several specific issues.

US citizens and green card holders

Americans face the most complex cross-border picture. The US imposes estate tax on the worldwide assets of its citizens and permanent residents at death, with a federal exemption that can change with legislation. Israeli-situated assets — real estate, bank accounts, and company shares — all count toward the US taxable estate. A US living trust (revocable trust) may help manage US-situated assets but does not automatically cover Israeli assets; a separate Israeli arrangement is needed.

Americans with Israeli assets also need a US durable power of attorney alongside the Israeli Enduring POA — the US document covers US accounts and property while the Israeli document covers Israeli assets. Israeli institutions do not automatically recognise a US durable power of attorney, and US institutions are unlikely to accept an Israeli one.

UK nationals

UK residents have a more straightforward position in one respect: the UK does not tax the worldwide estate of non-domiciled individuals on their non-UK assets at death (though this is changing with reforms to the non-dom regime). Israeli property owned by a UK national who is not domiciled in the UK has historically been outside the UK inheritance tax net. Israeli probate will still be required for the Israeli assets, however. A UK lasting power of attorney (*LPA*) is not automatically recognised in Israel (Israel is not a party to the 2000 Hague Convention on the International Protection of Adults), so Israeli assets are better covered by an Israeli Enduring POA.

European nationals

EU Succession Regulation 650/2012 (Brussels IV) allows EU nationals to choose the law of their nationality to govern their EU-situated estate, rather than the law of habitual residence. This can be relevant for Europeans with assets in both an EU country and Israel, but Brussels IV has no legal effect on Israeli assets — Israeli succession law applies to those regardless.

The choice-of-law provision in Israeli wills

Under Israeli private international law, a person may include a choice-of-law clause in their Israeli will specifying that the law of a particular country (typically their country of nationality or domicile) should govern the interpretation and distribution of their estate. Israeli courts will generally give effect to such a choice for movable assets, though Israeli law continues to govern immovable property (real estate) situated in Israel regardless of any such clause.

7. Practical Steps: Where to Start

Estate planning does not need to be done all at once. A logical sequence for a foreign national with Israeli assets:

1. Take stock of what you have in Israel. List all Israeli-situated assets: real property (with Tabu registration numbers), bank accounts (institution, branch, account number), investments, pension rights, and company shares. Your Israeli attorney will need this to advise on the right structure.
2. Make an Israeli will. This is the minimum step. Even if you want a trust or an Enduring POA, a will is the backstop. Engage an Israeli attorney — not just a notary — to draft it properly, deposit it with the Registrar of Inheritance or retain it securely, and inform your heirs of its existence.
3. Make and deposit an Enduring Power of Attorney if you are over 60 or have health concerns. Do this while you are clearly competent — once cognitive decline begins, the window closes. If you cannot travel to Israel, make a trip for this specific purpose.
4. Consider whether a trust makes sense. If your Israeli estate includes significant real property or you have complex family circumstances (children from different relationships, a beneficiary with special needs, property you want kept in the family for multiple generations), discuss a trust structure with an Israeli attorney who specialises in estate planning.
5. Register a medical directive. This takes less than an hour and costs nothing. Use the Ministry of Health's online portal to register it in the national database.
6. Coordinate with advisers in your home country. Share your Israeli estate plan with your home-country attorney or financial adviser so they can ensure your global arrangements are consistent.
7. Review every three to five years. Israeli law changes, family circumstances change, and asset values change. Build in a regular review to keep your plan current.

A French couple, both in their late sixties, had owned an apartment in Netanya for twelve years but had no Israeli estate planning documents of any kind. When the husband suffered a stroke in Lyon and lost capacity, there was no Israeli Enduring Power of Attorney to manage the apartment — the only route was a full guardianship application to an Israeli Family Court, a process that took eleven months, required medical assessments translated into Hebrew, and cost approximately NIS 28,000 in legal and court fees. After the guardianship was finally in place, a simple Israeli Enduring Power of Attorney for the wife was prepared simultaneously, deposited with the Administrator General within three weeks, and cost NIS 4,500 all in. The lesson: the Enduring POA is dramatically cheaper and faster than guardianship — but only if it is set up before capacity is lost.