Quick Answer: From January 1, 2026, new immigrants to Israel (olim chadashim) must file annual Israeli income tax returns disclosing their worldwide income and assets — even if all that income is fully exempt from Israeli tax under the 10-year new-immigrant exemption. The April 2, 2024 amendment to the Income Tax Ordinance abolished the reporting exemption that previously allowed Olim to skip the filing requirement during their exemption period. The obligation to disclose exists independently of the obligation to pay tax. Form 150 (doch 150) is the primary disclosure vehicle, and the standard filing deadline is April 30 of the following year. Failure to file carries automatic penalties under Section 191 of the Ordinance starting from NIS 500 per month of delay.

For decades, one of the most practical benefits of making aliyah was the combination of a tax exemption and a reporting exemption. New immigrants paid no Israeli income tax on foreign-source income and capital gains for ten years under Section 14 of the Income Tax Ordinance — and they did not have to report any of it to the Israel Tax Authority (rashut hamissim) either. An Oleh receiving dividends from a US brokerage, rent from a French apartment, or distributions from a Canadian family trust could legitimately omit those sources from their Israeli tax return, often filing no return at all if their only income came from outside Israel.

That combination was severed on April 2, 2024, when the Israeli legislature amended the Ordinance to abolish the reporting exemption. The change takes effect for tax years beginning January 1, 2026. From that date, new Olim must actively disclose worldwide income and assets to the ITA each year — reporting everything, paying tax only on what is not exempt. For the roughly 30,000 people who make aliyah each year from the United States, United Kingdom, Canada, France, and dozens of other countries, this amendment changes how new Olim must deal with Israeli tax authorities from the first day of residency.

This guide explains what the new rules require, how they interact with the income exemption that remains intact, who is affected, and what the practical filing process looks like at the ITA.

1. Background: the reporting exemption and why it was abolished

The modern 10-year exemption regime for new immigrants was introduced by Amendment 168 to the Income Tax Ordinance in 2007. The policy had two goals: attract diaspora capital and talent by removing double-taxation risk during the integration period, and simplify the transition to Israeli tax residency by not requiring Olim to navigate Israeli reporting obligations while still maintaining financial ties to their country of origin.

Section 134B of the Ordinance, as it stood before 2024, provided that a new immigrant was not required to include foreign-source income or foreign assets in their annual Israeli tax return during the exemption period. The practical effect for most Olim with only foreign-source income was that they had no real Israeli tax filing obligation for the first ten years after aliyah — no return to prepare, no accountant to retain in Israel, no interaction with the ITA whatsoever on foreign matters.

Over time, however, the combination of an income exemption and a reporting exemption created a compliance blind spot that both the ITA and the Knesset Finance Committee found increasingly untenable. Without any disclosure requirement, the ITA had no visibility into whether income claimed as foreign-source was genuinely so, whether foreign trust and company structures were being used to shelter Israeli-source income, or whether Olim whose exemption had expired were continuing to behave as if it had not. The 2020s also brought dramatically expanded international tax-information sharing under the OECD Common Reporting Standard (teken midua), giving Israeli tax authorities access to foreign-account data that taxpayers had no corresponding obligation to disclose.

The April 2, 2024 amendment — part of a broader package of Income Tax Ordinance changes — severed the reporting exemption from the tax exemption. The income exemption survived entirely. The reporting exemption did not.

2. Tax exemption versus reporting obligation: the critical distinction

In the post-2026 regime, the reporting obligation and the tax obligation are legally separate and run independently of each other. Conflating the two is an easy mistake — and an expensive one if it leads an Oleh to skip filing altogether.

The 10-year income tax exemption under Section 14 of the Income Tax Ordinance remains completely intact. A new immigrant who made aliyah on January 15, 2026 continues to enjoy a full exemption from Israeli income tax on all foreign-source income and capital gains for ten years from that date. Dividends from a US brokerage account, rental income from a British property, proceeds from selling shares in a Canadian company, interest accruing in a French bank account — all of these remain outside the scope of Israeli income tax during the exemption period, exactly as before the 2024 amendment.

What changed is the obligation to disclose. Before the amendment, an Oleh in the exemption period could lawfully omit foreign-source income from their return entirely. From January 1, 2026, that same Oleh must report the income — describe it, quantify it, categorize it — even though no Israeli tax is owed on any of it. The return will say "I received $120,000 in dividends and rental income from foreign sources; all of it is exempt under Section 14; my Israeli tax liability is NIS 0." The tax bill is the same as before: zero. The relationship with the ITA is not.

Think of it this way: before 2024, the Ordinance told new Olim they did not need to knock on the ITA's door. From 2026, they must knock every year, hand over a full account of their foreign income and assets, and wait while the ITA confirms that no tax is owed before they leave.

In Practice — Oleh Arriving in 2025 vs. Oleh Arriving in 2026: An Oleh who made aliyah on June 1, 2025 is currently in the first year of their 10-year exemption. Under the prospective amendment, their 2025 return is governed by the pre-amendment rules — they were not required to include foreign income on a 2025 annual return. For the 2026 tax year and every year thereafter through 2035 (the end of their exemption period), however, they must file Form 150 disclosing all foreign income and assets, even though none of that income is taxable. An Oleh who arrives on January 1, 2026 faces the full reporting obligation from their very first Israeli tax year. Both Olim should register at the relevant ITA District Tax Office and retain an Israeli CPA with international tax experience before December 31, 2026 — not after the April 30, 2027 filing deadline.

3. Who is covered by the new rules

The amended reporting obligation applies to the following groups:

  • New immigrants (olim chadashim) who become Israeli tax residents for the first time on or after January 1, 2026, and who have foreign-source income or hold foreign assets during the exemption period
  • Returning residents (toshavim chozrim) who qualify for the extended exemption under Section 14 of the Ordinance and who return to Israeli residency on or after January 1, 2026 after living abroad for at least ten consecutive years (long-term returning residents who qualify for a 10-year exemption themselves)

Olim who made aliyah before January 1, 2026 are technically governed by the pre-amendment rules for tax years before 2026. The amendment is prospective: it does not retroactively impose a reporting obligation on years already elapsed. For tax year 2026 and beyond, however, many Israeli CPAs are advising all Olim — regardless of arrival year — to file annual returns as a matter of sound practice, both because the ITA expects disclosure from Olim with significant foreign assets and because CRS data-sharing means the ITA may already hold information about those accounts.

Standard Israeli tax residents who are not in an exemption period were always required to report worldwide income under the Ordinance. The 2024 amendment is irrelevant to them.

There is one carve-out worth knowing: individuals whose income falls below the CPI-adjusted annual filing threshold are not required to file at all. In practice, most Olim with foreign investments — a US retirement account, an overseas rental property, a business interest abroad — exceed that threshold once worldwide income is counted, even when the Israeli tax on all of it is zero.

4. What must be disclosed on the annual return

Form 150 covers four broad categories. All of them appear on your return even when the income generates no Israeli tax at all.

Foreign income, categorized by type:

  • Employment income from a foreign employer, including salary, bonus, and equity compensation
  • Business income from a foreign self-employment activity or sole proprietorship
  • Dividends received from foreign companies
  • Interest from foreign bank accounts, bonds, and deposits
  • Rental income from real estate located outside Israel
  • Royalties from intellectual property registered or licensed abroad
  • Pension distributions, including payments from US 401(k) plans, IRAs, Canadian RRSPs, UK SIPPs, and similar retirement vehicles
  • Capital gains on the sale of foreign assets, including shares, real estate, and business interests

For each category, the Oleh reports the gross amount in the foreign currency, the ITA's official exchange rate for the relevant date or period, and the NIS equivalent. An exemption code corresponding to Section 14 is entered in the adjacent column to indicate why no Israeli tax is owed.

Foreign assets at year-end:

  • Financial accounts held at foreign banks and brokerages: institution name, country, account number, and balance on December 31
  • Real estate located outside Israel: property address, ownership percentage, and approximate market value
  • Shares in foreign corporations, whether publicly traded or privately held: company name, country of incorporation, and ownership percentage
  • Interests in foreign partnerships, including US LLCs treated as partnerships for US tax purposes

Foreign trusts and foundations: Any trust in which the Oleh serves as settlor, beneficiary, or trustee must be disclosed. The ITA's reporting requirements for foreign trusts under Sections 75C through 75H of the Ordinance apply as a separate overlay on top of the new-immigrant reporting rules and carry their own disclosure forms filed alongside Form 150. An Oleh who is both an exempt new immigrant and a trust beneficiary faces two overlapping sets of obligations.

Foreign company control: An Oleh who controls a foreign company under the Controlled Foreign Company rules in Part E of the Ordinance — generally, an Israeli resident holding more than 50% of any means of control in a foreign company — may have additional disclosure and tax obligations even during the new-immigrant exemption period, depending on the nature of the company's income. Get specific advice if you control a foreign company.

In Practice — Scope of Disclosure for a Typical American Oleh: Consider a US citizen who made aliyah on March 1, 2026 and holds the following: a Schwab brokerage account with $300,000 in US equities, a traditional IRA at Fidelity with a balance of $180,000, a 401(k) from a former employer with a balance of $220,000, a rental condominium in Florida generating $24,000 per year in net rental income, and a 15% stake in a family LLC that runs a retail business in New Jersey. All of this income and all of these assets must be disclosed on Form 150 for the 2026 tax year. The brokerage dividends, IRA distributions (if any), rental income, and LLC distributions are each reported on Part D. The accounts, real estate, and LLC interest are each reported on Parts E and F. Every line is marked as exempt under Section 14. The Israeli tax liability on all of it is NIS 0. The obligation to file Form 150 and disclose all of it is absolute.

5. Form 150: structure and key fields

Form 150 (tofes 150 or doch 150) is the Israeli annual return for individuals with complex income profiles — as distinguished from Form 1301, the simplified return for salaried employees whose entire income comes from an Israeli employer. The ITA significantly expanded Form 150's foreign-asset and foreign-income sections as part of the 2026 reporting obligation reform.

The sections most relevant to new Olim are:

  • Part D — Foreign income: Broken into subcategories matching the income types listed above. Olim complete this section for each income type received, entering the exemption code in the column provided to explain why the income is not included in taxable income
  • Part E — Foreign assets: A balance-sheet-style section listing all overseas holdings at the end of the tax year. The ITA cross-references Part E disclosures against Common Reporting Standard data automatically received from foreign financial institutions and foreign tax authorities. Discrepancies between what the Oleh reports and what the ITA has already received from foreign sources are a primary trigger for ITA inquiries
  • Part F — Foreign trusts and companies: Identifies any foreign legal structure — trust, foundation, or company — in which the taxpayer has an interest, and describes the taxpayer's role (settlor, beneficiary, trustee, shareholder)
  • Appendix C — New immigrant declaration: Confirms the date of first Israeli residency, the applicable exemption period end date, and the basis on which foreign income is being excluded from taxable income. This appendix is specific to new Olim and returning residents claiming the Section 14 exemption

The ITA publishes updated Form 150 completion instructions (horaot miluy) each year. For the 2026 tax year, the instructions are expected to include a dedicated section on new-immigrant disclosure obligations. The ITA's taxpayer assistance line at 4954* (within Israel) or +972-2-5656400 (from abroad) handles general questions about form completion. For situations involving multiple foreign accounts, trust interests, or business holdings abroad, it is worth engaging an Israeli CPA (roa heshbon) or licensed tax adviser (yoetz mas) with international tax experience rather than self-preparing.

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6. Deadlines and the ITA filing process

Standard annual return deadline: April 30 of the year following the tax year. For the 2026 tax year, the filing deadline is April 30, 2027.

Extension through a CPA representative: An Israeli CPA or tax adviser registered with the ITA under a mass-representation arrangement can obtain a standard extension for their clients, typically moving the effective deadline to November 30 of the year following the tax year. This extension requires the CPA to register the taxpayer on their professional client list before April 30. It is an administrative arrangement, not an automatic right — Olim who miss the April 30 deadline without a registered CPA representative do not automatically receive the extension.

First-year partial return: For an Oleh who became an Israeli tax resident mid-year in 2026, the first annual return covers only the period from the date of first Israeli residency to December 31, 2026. A partial-year return must be filed even if the individual was resident in Israel for only a few weeks. The ITA's District Tax Office serving the Oleh's Israeli home address handles the registration and the first filing.

ITA registration: Before filing a first return, a new Oleh must register as an Israeli tax resident at the relevant ITA District Tax Office. The offices serving the highest concentrations of new immigrants include the Tel Aviv District Office (covering Tel Aviv and central Israel), the Jerusalem District Office (covering Jerusalem and the surrounding area), and the Haifa District Office (covering the north). Registration typically requires presenting the teudat oleh (immigration certificate), Israeli identity card or passport, and proof of Israeli residential address. Registration should be completed as early as possible after arriving in Israel and before the first December 31 year-end, not rushed in the weeks before the April 30 deadline.

Digital filing via the ITA portal: The ITA's online portal at shaam.gov.il supports electronic submission of Form 150. New Olim must first obtain digital access credentials, either through an Israeli digital signature or through the ITA's two-factor authentication system linked to an Israeli identity number. Once registered, the portal allows Olim to track their filing status, receive acknowledgment of receipt, correspond with their assigned tax assessor (pakid shumah), and access prior-year returns. For complex cases — multiple foreign accounts, trust interests, or significant capital transactions — CPA-prepared returns submitted through the CPA's registered professional portal generally receive more efficient processing than self-prepared electronic returns.

In Practice — Timeline Reference for a 2026 Oleh's First Filing: Aliyah date: January 2026. Register at ITA District Tax Office: by March 2026 — do not wait until the filing season. Retain Israeli CPA with international experience: by September 2026, to allow sufficient time for the CPA to register the client for extension purposes before April 30, 2027. Gather foreign tax documents: US Form 1099-DIV, 1099-INT, K-1 for any partnerships, foreign bank statements showing year-end balances, valuations for any privately held company interests — all needed for Form 150 Part D and Part E. First Form 150 filing deadline: April 30, 2027 (or November 30, 2027 with CPA extension). ITA processing of first return: typically 3 to 6 months; a zero-tax return for an Oleh in the exemption period is not a priority processing case, but the ITA may request clarification on specific foreign income or asset items.

7. Penalties for late or incomplete filing

Automatic late-filing penalty under Section 191: NIS 500 per month or part-month of delay beyond the filing deadline, up to a maximum of NIS 6,000 per return — reached after 12 consecutive months of delay. This penalty applies regardless of whether any tax is owed. An Oleh who is fully exempt from Israeli tax on all foreign income is still subject to the NIS 500 monthly penalty if their Form 150 is filed late.

Interest on late-filed returns: Where a return is filed late and any tax is owed, interest (rishul) accrues on the outstanding balance at the statutory rate, currently linked to the CPI plus a fixed spread. For most Olim in the full exemption period, no tax is owed and no interest accrues — but the Section 191 penalty still runs regardless of any tax balance.

Penalties for incomplete or inaccurate disclosure: The ITA can apply an accuracy penalty under Section 190 of the Ordinance where a taxpayer files a return that understates income or omits assets and the ITA determines the understatement exceeds a threshold. For deliberate concealment of foreign assets — an Oleh who knows they hold a foreign account and deliberately omits it from Part E — the ITA can assess a surcharge of 15 to 30 percent of the asset's value. This surcharge is separate from and cumulative with the Section 191 late-filing penalty.

Common Reporting Standard cross-checking: Israel participates fully in the OECD Common Reporting Standard. Foreign banks and financial institutions in over 100 participating jurisdictions automatically report Israeli tax residents' account balances and income to the ITA each year. An Oleh who holds a foreign account but leaves it off Form 150 Part E faces real audit risk: the ITA's automated data-matching system flags discrepancies between CRS reports and individual returns. CRS-triggered inquiries are increasingly common and can result in assessments, penalties, and in serious cases, criminal referrals.

Criminal exposure: Deliberate failure to file a required annual return is a criminal offense under Section 216 of the Income Tax Ordinance, punishable by up to two years' imprisonment in addition to all applicable civil penalties. Providing materially false information on a return carries the same potential criminal exposure. For an Oleh whose failure to file is a genuine oversight — common in the transition period before the new rules are fully established — voluntary disclosure with a complete Form 150 well in advance of any ITA contact is the appropriate response and generally results in penalties limited to the Section 191 automatic amount.

The ITA has stated publicly that its 2026 and 2027 compliance strategy for new Olim will emphasize education and voluntary filing, with enforcement focus reserved for cases involving deliberate concealment rather than first-time administrative non-compliance. That said, the rules are in force from January 1, 2026, and the ITA's data-matching capabilities mean that sitting it out is not a sustainable approach for Olim with significant foreign assets.

Frequently Asked Questions

No. The 10-year income tax exemption under Section 14 of the Income Tax Ordinance remains completely intact. Foreign-source income earned during the exemption period is still not subject to Israeli income tax. What changed is the obligation to disclose that income on your annual return. You will report the income, state the applicable exemption code, and owe nothing — but you must file the return. Reporting an income item is not the same as being taxed on it.

The April 2024 amendment is prospective: it applies to tax years beginning on or after January 1, 2026. If you made aliyah before 2026 you are technically governed by the pre-amendment rules for years already elapsed. For the 2026 tax year and beyond, however, many Israeli CPAs are now advising all Olim — regardless of arrival year — to file annual returns with full foreign-income disclosure, both because the ITA expects it for Olim with meaningful foreign assets and because CRS data the ITA already holds creates audit risk for non-filers with foreign accounts.

Yes, if the pension income meets the ITA's annual filing threshold. Foreign pension income is specifically listed among the categories that must be disclosed on Form 150 Part D, even when entirely exempt under Section 14. You report the pension, the source country, the gross amount in the foreign currency, the NIS equivalent, and the exemption code. Whether it is a US Social Security payment, a UK defined-benefit pension, or a Canadian CPP benefit, the disclosure obligation applies regardless of the zero tax outcome.

Yes. Interests in foreign companies and partnerships, including minority stakes in US LLCs, must be reported on Form 150 Part F for each tax year in which you hold them. You report the entity's name, country of incorporation, and your ownership percentage. If the LLC distributes income to you during the year, that income is also reported on Part D with the appropriate exemption code. The ITA cross-references Form 150 disclosures against CRS data, so undisclosed foreign company interests carry real audit risk.

The automatic penalty under Section 191 is NIS 500 per month of delay, up to a maximum of NIS 6,000 after 12 months. This applies even when no tax is owed. An Oleh who deliberately omits known foreign assets faces additional surcharges of 15 to 30 percent of those assets' value. Voluntary late filing with a complete disclosure — before the ITA contacts you — generally results in penalties limited to the Section 191 administrative amount and avoids the more serious consequences associated with an ITA-initiated audit finding.

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