The Law for the Encouragement of Capital Investments grants significant tax benefits for a building approved as a rental property.
Applications under the previous law can only be submitted until 12/31/2023 Applications can also be submitted if a building permit does not yet exist
Tax benefits under the Law for the Encouragement of Capital Investments include reduced tax rates on rental income and on profits from sales. The tax rates are:
- 20% per person;
- 11% to the company;
- A reduced tax rate of 20% on the dividend
- Accelerated depreciation at a rate of 20% (meaning that during the first five years, the full amount of the investment in the apartments can be claimed as an expense).
Applications may be submitted for at least 6 apartments in a single building (or in multiple buildings constructed as a single project), provided that at least 50% of the total number and floor area of the apartments are designated for rental and will be rented for at least 5 years. The remaining apartments may be sold immediately, and the seller may receive tax benefits on the sale.
Applications for recognition as an "approved enterprise" must be submitted before the completion of construction.
Due to the security situation, a procedure has been updated to allow applications to be submitted even if a building permit has not yet been issued, provided that the permit will be obtained by June 30, 2024. In such a case, an approved decision from the local committee regarding the issuance of a building permit for the building in question must be attached to the application..
For applications not submitted by December 31, 2023, the new law will apply, under which the minimum lease term will be 15 years, the minimum number of apartments for the program will be 10 (or 6 in peripheral areas), and at least 66% of the apartments (33% in peripheral areas) must be rented out.
For an examination of eligibility for tax benefits – contact us now:
Phone: 058-3211824
WhatsApp: 0555-6667708
Email: [email protected]
