Calculate net capital gains after offsetting losses in Israel 2025. Capital losses from shares and investments can offset capital gains in the same year or be carried forward. Compute taxable gain and tax at 25 percent.
Enter your capital gains, current-year losses, and any prior-year unused losses carried forward to compute your net taxable gain and the Israeli capital gains tax at 25 percent.
Net taxable capital gain
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Gross capital gains
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Total offsetting losses
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Net taxable gain
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Tax at 25 percent
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Your breakdown
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Tax-loss harvesting strategy in Israel
Tax-loss harvesting means deliberately selling investments that are sitting at a loss to realise those losses and use them to offset gains elsewhere in your portfolio. In Israel, this is a straightforward and legal strategy. If you have, say, 50,000 ILS in unrealised gains from one stock and 30,000 ILS in unrealised losses from another, selling both in the same tax year leaves you with only 20,000 ILS of taxable gain rather than 50,000 ILS. The tax saving at 25% is 7,500 ILS. You can then immediately reinvest the proceeds if you wish, though be aware of wash-sale rules that may apply in some jurisdictions (Israel does not have a formal wash-sale rule but the Tax Authority scrutinises transactions that appear to lack economic substance).
Carryforward mechanics and annual reporting
If your current-year losses exceed your current-year gains, the excess is a capital loss carryforward. You must declare this in your annual tax return (doch) even if no tax is owed, so the Israel Tax Authority has a record of the balance. In subsequent years you declare the carryforward again and use it against new gains. There is no time limit, but the documentation trail must be clean. If you change your tax status (for example, by leaving Israel or returning), the treatment of accumulated carryforwards may be affected.
What this calculator does not model
This calculator uses nominal gains and losses, not inflation-adjusted figures. In practice, Israeli capital gains tax is applied to real (inflation-adjusted) gains, so the actual taxable gain may differ. It also does not model the 30% rate for substantial shareholders, losses from real estate transactions (Mas Shevach uses separate rules), or the interaction with foreign tax credits. For a precise calculation, use the capital gains tax calculator alongside this tool or consult a licensed tax adviser.
Frequently asked questions
Can capital losses be offset against capital gains in Israel?
Yes. Under Israeli tax law, capital losses realised from the sale of securities (shares, bonds, mutual funds) can be offset against capital gains realised in the same tax year. If losses exceed gains in a given year, the net loss can be carried forward indefinitely to offset future capital gains. Losses cannot generally be used to reduce ordinary income such as salary or rental income. The Israel Tax Authority tracks carryforward balances through the annual return.
How long can capital losses be carried forward in Israel?
Capital loss carryforwards in Israel are indefinite. There is no expiry period. A loss realised in 2020, for example, can still be used to offset gains in 2030 or beyond. However, the loss must have been properly reported in the year it arose and declared in the annual return each subsequent year. Losses that were not reported in the year they occurred cannot simply be claimed retroactively without an amended return.
Do capital losses from foreign investments offset Israeli capital gains?
Generally yes, if the foreign investment loss is a type of capital loss recognised under Israeli law. Israeli tax residents are taxed on worldwide income, and losses from foreign securities are treated similarly to domestic losses for offset purposes. However, foreign exchange gains and losses, and losses from investments in certain countries, may have special rules. Confirm with a tax adviser for cross-border portfolios.
Is there a tax rate reduction if I offset losses to bring my gain near zero?
The 25 percent capital gains rate applies to the net taxable gain after all offsets. If your offsets reduce the taxable gain to zero, you pay no capital gains tax. There is no reduced rate for small gains: the 25 percent rate is flat regardless of the gain size for individual investors in publicly traded securities. Substantial shareholders (10 percent or more) pay 30 percent on dividends and certain gains.