An oleh is entitled to a Customs exemption for 3 years on imported business equipment if he is registered as “self-employed’’ (atzmai) or is an owner of a business and fulfills the Customs (Meches) requirements listed below:
The maximum total value of goods that can be exempt is $36,000. This amount includes portable tools, whose value may not exceed $1,650. If the value of the goods exceeds $36,000, Customs Duties will be charged on the excess amount.
The oleh must submit documents to Meches showing he is a business owner or self- employed in order to release the equipment tax-free.
The oleh must produce a certificate showing that he is registered as the owner of a business or is self employed (atzmai) with VAT (value added tax) registration.
The equipment must be used in the oleh’s declared work place, must be stored on the premises and must be related to the business (ie, dental chairs will be exempt, however a table and chairs for the waiting room will not be exempt). Supplies are also not exempt.For example, dental x-ray film is not exempt, while the x-ray machine is exempt.
If the eligible oleh is not the sole owner of the enterprise, but only a partner or a shareholder, he must present proof that one owns at least 50% of the enterprise and is an active worker at the enterprise. In such a case the immigrant is entitled to lease the goods imported through exemption to the enterprise, provided that this fact is stated explicitly in the agreement contract between the eligible immigrant and the said enterprise and that these goods can stay leased as long as the immigrant is a partner or a shareholder in that enterprise.
The oleh may not sell the equipment or transfer it to any other person before the end of five years from the date of Customs clearance without the approval of the Israeli Tax Authority (Reshut HaMisim). If the oleh sells or transfers the equipment during the five year period, taxes must be paid.
To ensure all of the above, Meches requires the oleh to deposit guarantees (bank guarantees or cash deposits) equal to duties and taxes payable, until Meches verifies the equipment is actually used by the oleh, for the stated business purpose.
Importing Business Equipment
If the oleh is planning to be self-employed, but has not yet fulfilled the requirements listed above, he may pay the required customs duties as a deposit which will be returned when he has fulfilled all the requirements.
This information applies to olim who want to open a business requiring specialized equipment including professionals and trades.
The exemption does not apply to motor vehicles, parts, raw materials, perishables, and all other goods intended for leasing.
An approved business equipment shipment can be imported from any country, and is in addition to the oleh’s right to import three shipments from any country.
An oleh may import portable tools from any country which are manufactured and sold as portable tools, if their value, (as determined by Meches) is under $1,650 without having to fulfill all the conditions listed above.
The oleh will need to provide the following documents for approval at the time of import (through a customs agent):
- Letter of approval for opening a file with Reshut HaMisim (Tax Authority);
- Letter of approval for opening a file with Meches;
- Rental contract for the place of business;
- Detailed list of the equipment being imported;
- Purchase invoice of the equipment;
- Letter explaining the nature of the business;
- Photocopy of teudat zehut and teudat oleh; and
- Approval from other relevant government offices as necessary (for example, if your business is agricultural, you will require approval from the Ministry of Agriculture (Misrad HaChaklaut).
Once the application is authorized by Meches, the oleh will need to deposit a bank guarantee based on the current tax rate. The guarantee must be valid for at least one year.
As for the value of the equipment, the Oleh will need to present documents that will allow Meches to determine their value for tax purposes.
Check with an AACI Counselor or Meches to confirm there have not been changes in this information.
Updated June 2015