The regulations provide extensions of time for certain tax-related deadlines. Specifically, the period 22 March 2020 – 31 May 2020 is not considered to be “calendar days” for purposes of determining tax-related deadlines and certain terms established under the Israeli tax laws. In particular, the regulations extend the:

Concerning dates provided by the income tax law:

• Deadlines for the tax authorities to answer a taxpayer request for an advance pricing agreement
• Deadlines for distribution of stock options to employees after approval
• Deadlines for submission of notification of certain qualified tax-neutral reorganizations
• Certain deadlines for collection of tax debts
• Deadlines for auditing tax returns
• Deadlines for taxpayers to appeal the tax authorities decisions

Concerning dates provided by the value added tax (VAT) law:

• Deadlines for auditing tax returns
• Deadlines for taxpayers to appeal certain types of tax authorities’ decisions

Concerning dates in the real estate tax law:

• Deadlines for issuance of a written decision by the tax authorities
• Deadlines for various notifications that need to be submitted to the tax authorities—in particular, notifications of selling an apartment
• Deadlines for the tax authorities to confirm or contest the value used in a transaction and for the taxpayer to appeal this determination

Concerning dates in the law for encouraging investments:

• Deadlines for applying for the "election year" for start of the benefits
• Deadlines for applying for advance approvals

The regulations also address deadlines in other “minor” or grandfathered tax laws. Regarding other tax-related measures, the regulations extend the:

• Deadline for filing annual corporate income tax reports—the due date of 31 May is postponed to 31 July 2020 (further extensions are available upon request), and the same deadlines apply for individual income tax reports submitted electronically.
• Deadline for filing paper individual income tax reports—the due date of 30 April is postponed to 30 June 2020 (further extensions are available upon request).
• Deadline for monthly VAT reporting and payment—the due date of 16 March is postponed to 26 March 2020.
• Deadline for bi-monthly VAT reporting and payment—the due date was postponed from 15 April to 27 April 2020.
• Deadline for renewing annual withholding tax certificates—the due date is postponed from 31 March to 30 April 2020.

The VAT authorities will allow an input VAT deduction to be claimed with the submission of a scanned copy of a tax invoice issued in the period between 1 March 2020 and 31 May 2020 (normally a signed paper original or a digital copy with electronic signature is required).

Entrepreneurs affected by the COVID-19 situation may apply for decrease of social security advance payments. For self-employed individuals, the deadline for the March 2020 social security payments is postponed from 15 April 2020 to 15 May 2020.  

For more information, contact a KPMG tax professional in Israel:

Asaf Leshem | aleshem@kpmg.com

Yaniv Yesharim | yyesharim@kpmg.com