No fewer than 25 tax planning schemes have been added this year to the list of schemes that require reporting to the Tax Authority - tax planning schemes that taxpayers are obliged to "illuminate with a spotlight" for the Authority so that it can examine whether they are legitimate or otherwise. Among other things, taxpayers are required to report on tax planning schemes in relation to cryptocurrencies, and how they have treated personal service companies and the use of the assets of such companies by their shareholders.
The updates are in addition to the 56 tax planning schemes in the list published last year.
The list follows legislation passed last year under which taxpayers are required to "place a spotlight" for the Tax Authority over tax planning schemes that are not in accordance with the stance of the Authority. This is part of the Tax Authority's campaign to curb non-legitimate tax planning and extreme interpretations of tax law.
Tax Authority director Moshe Asher said, "The obligation to report positions on tax law that differ from those of the Authority enable the Authority to deal better with ruthless tax planning and extreme interpretations of the law that reduce tax payments inappropriately for those who resort to them. The reporting of positions puts the tax planning schemes that need to be examined more out into the open, which leads to greater equality in the tax burden."
The positions that need to be reported are only those from which a tax advantage of at least NIS 5 million is derived in any one year, or NIS 10 million over four years. For indirect taxes (VAT, customs duties) the thresholds are NIS 2 million in one year and NIS 5 million over four years.
Published by Globes [online], Israel business news - www.globes-online.com - on January 1, 2018
© Copyright of Globes Publisher Itonut (1983) Ltd. 2018