New Israeli Income Tax Regulations, which were officially published on 6 February 2019 (the "Regulations"), implement the Common Standard on Reporting and Due Diligence for Financial Account Information ("CRS"), which was developed by the OECD.
Under the Regulations, Israeli financial institutions are required to report to the Israeli Tax Authority annually concerning international residents with financial accounts in Israel. The definition of the term "Financial Institution" is very broad, and includes banks, investment funds, investment managers and brokers, entities which hold or manage financial assets on behalf of others, as well as certain insurance companies.
The Regulations impose a retroactive reporting obligation regarding financial accounts. The information on accounts existing in 2017 is to be reported no later than 23 June 2019. Information on accounts existing in 2018 shall be reported no later than 8 September 2019.
On an annual basis Israel will automatically exchange such information with over 95 foreign countries in accordance with the bilateral and multilateral agreements on the exchange of information. As part of the exchange of information, Israel will receive financial information concerning the foreign accounts of Israeli residents (including information on financial income, as well as account balances).
It should be noted that the automatic exchange of information with certain countries, including Australia, Canada and the United Kingdom, will commence...