Apartment Sale Delayed because of COVID-19? Home Upgraders Eligible for an Extension
Apartment owners experiencing difficulty selling their old apartments are entitled to a seven-month extension in which to sell, and the Israel Tax Authority will not count this period for tax purposes.
Based on the increased difficulty of selling apartments in recent months, the Knesset approved the second and third readings of a bill to extend sale periods and postpone deadlines in tax proceedings. The bill proposes to not count for buyers of residential apartments who were supposed to sell old apartments within 18 months from the date of purchase of a new apartment, in order to enjoy reduced purchase tax rates, and for whom the last date for sale of the old apartment fell in the period between March 1, 2020, and October 1, 2020, this seven-month period.
The law also states that this period will not be counted for those who had to sell their old apartment within a period of 18 months from the date of purchase of an additional apartment, in order to enjoy an exemption from betterment tax on the sale of the old apartment.
According to the Real Estate Tax Law, an individual who purchases a new apartment before selling his old apartment is entitled to the purchase tax bracket of a “single apartment” when purchasing the new apartment, as well as exempt from betterment tax on the sale of the old apartment, if he sells his old apartment on the dates set by law and subject to other conditions. Within the framework of the bill passed as mentioned above, the period between March 1, 2020, and October 1, 2020, will not be included in the count for the exemption period.