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Tax Alert No. 5
15.7.2009
International taxation - Trusts – Extension of the reporting period until October 30, 2009As we indicated in our Tax Alert No. 2 (August 25, 2008), the 147 Income Tax Ordinance Amendment has introduced a new tax regime of trusts into the Israeli tax law. Amendment 147 (effective date January 1, 2006) also imposed certain reporting requirements on trusts that were created prior to Amendments 147. A detailed tax amendment (Amendment 168) that was issued on June 11, 2008 and its Regulations has changed the reporting requirement: it requires the trustee to provide certain information regarding the four kinds of trusts and in addition it replaces the reporting requirement with a mere formal notification to the Income Tax Authority (“ITA“). Notification requirements in relation to the four kinds of trusts under the Israeli law include:
Where a trust agreement of an IRT or TT ceases to be effective, the trustee is required notify the ITA until April 30 of the following tax year. Special notification requirements regarding trusts that were created prior to January 1, 2009: The Amendment requires notification in relation to trusts that were created prior to the enactment of Amendment 147. There were few postponements of the notification deadline (June 11, 2008, September 9, 2008) and the current deadline is October 31, 2009. This date also applies to tax filings (Section 131). In addition, specific forms were published by the ITA. These forms are in both Hebrew and English. A set of formal rules was also published in order to elaborate the process of opening an ITA File (with the relevant Tax Assessing Officer, mainly with Tax Assessing Officer Tel Aviv 1 or 3 that will be formally regarded as the Tax Assessors of Trusts).
בכבוד רב,
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