Taxation of overseas activities by Israelis
There are many business opportunities around the world, and many Israelis take the opportunity to invest their monies abroad. The investment abroad exposes the investor – be it an individual or corporation – to double taxation and to financial undertakings that were not thought of from the start. The tax burden can take a serious bite out of the expected profits and potentially make the whole investment undesirable in the final analysis. We are of course aware of these exposures – what we call “tax accidents”.
In order to prevent such tax accidents, it’s important to consider the tax strategy of the investment up front, and to plan the financial structure on a bespoke basis. We, in the Israeli tax department, are fully aware of the differing options for each investment and can build the right tax and financial structure that is appropriate for each investment depending on the country in which the investment is being made, as well as the investor themselves. Our involvement in the process in instrumental and helps to ensure that the investment in successful. The eventual profitability of an investment is highly influences by choosing the right tax track up front, taking into account the various tax treaties that Israel has signed with countries around the world.
Amongst other suggestions, we may advise our clients to open up corporations abroad, in various structures (such as C-Corporation, LLCs), taking into account the ability or limitation of offsetting losses, selling property and the ensuing capital gains tax, sales of options and other capital gains implications.
Taxation of new immigrants or veteran returning residents
A new immigrant or veteran returning resident to Israel who is required to file tax returns in Israel and/or other countries around the world – especially USA, UK or France – will find within our firm the full service for submitting returns which takes into account the two tax systems and the differences between them. Our Israeli tax department, together with our international tax department can give a holistic and wide-ranging solution to those clients with a dual set of obligations; both Israeli and elsewhere. In this respect, our firm offers a unique service in that the same firm can prepare and file returns for a client in two jurisdictions. Our experts are well versed in the laws and tax systems of Israel and other countries, and are able to apply their professional expertise to each aspect of the client in each jurisdiction, in order to plan for taxes so as to minimize the total international tax burden, thereby saving the client from excessive payments and tax accidents.