Buying a property is an important decision that requires careful attention to detail. Here are some points to consider before signing a purchase contract and why it is essential to be accompanied by a lawyer specialized in real estate:
1. Proper identification of the property:
Before signing a purchase contract, it is essential to ensure that the property is properly identified. Accurate identification ensures certainty as to the nature and characteristics of the property being sold. A Lawyer can perform the necessary checks to confirm the accuracy of the property identification.
2. Tax bracket update:
It is critical to understand the tax brackets and the amounts associated with the acquisition tax. The brackets are updated annually, so it is important to know the latest tax information. A lawyer can explain the tax brackets in detail and help you assess the financial implications.
3. Acquisition tax reduction :
Depending on your specific situation (resident or foreigner, first or additional purchase, new immigrant, etc.), it may be possible to reduce the amount of the acquisition tax. A lawyer specialized in real estate will be able to advise you on the possibilities of reducing the acquisition tax and guide you in the steps to follow.
v First time buyer – Israeli resident:
Please note that in order to benefit from this abatement, you must be an Israeli tax resident or become one within a maximum of 2 years after the acquisition.
- 0% tax for properties with a value of 0 to 1,919,155
- 3.5% tax for property valued between 1,919,155 and 2,276,360
- 5% tax on property valued between 2,276,360 and 5,872,725
- 8% tax on property valued between 5,872,725 and 18,416,900
- 10% tax for property worth more than 19,575,755
v Foreign resident or Israeli resident acquiring additional Property:
It should be noted that a foreign resident who makes Aliyah within two years of his or her acquisition may claim a refund of the acquisition tax in Israel, based on the calculation of the acquisition tax of an Israeli resident making the first acquisition.
- 8% tax for property with a value of 0 to 5,872,725
- 10% tax for property with a value of more than 5,272,725
v New immigrant (Ole Hadash):
- 0.5% tax for property valued between 0 and 1,928,220
- 5% tax on property valued at more than 1,928,220
4. Verification of easements and rights attached:
It is important to verify easements and rights attached to the property, such as parking rights, storage, roofs, terraces, gardens, etc. A lawyer can review relevant documents, such as the register of common property, to ensure that all rights and restrictions are clearly defined.
5. Tax Planning Advice:
A real estate lawyer can provide tax planning advice to optimize your financial situation in the event of a purchase or resale. By carefully planning your real estate transaction, you may be able to benefit from reduced tax payments or even a total exemption in some cases.
Finally,
It is strongly recommended that you exercise caution and vigilance before signing a real estate purchase agreement. Hiring a real estate lawyer will allow you to benefit from valuable legal advice, avoid potential pitfalls and ensure a safe real estate transaction with no surprises.