Israel Section 46 Donation Tax Deduction Calculator 2025
Calculate your annual tax saving from donations to approved Israeli charities (amutot) under Section 46 of the Israeli Income Tax Ordinance. Minimum donation 190 ILS. Deductible up to 30 percent of taxable income.
Enter your annual salary and total approved Section 46 donations to see your tax saving. The deduction reduces taxable income at your marginal rate, up to 30 percent of taxable income.
Annual tax saving from Section 46 donations
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Donations claimed (capped at 30%)
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Deduction applied to income
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Income tax without donations
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Income tax with donations
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Your breakdown
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How the Israeli Section 46 donation deduction works
Section 46 of the Israeli Income Tax Ordinance provides one of the most straightforward charitable tax deductions in the Israeli tax code. When you donate to an approved Israeli nonprofit (amuta with Section 46 status), the donated amount is deductible from your taxable income. Unlike some countries that offer a fixed tax credit regardless of income, Israel operates this as a true deduction from taxable income. This means the tax saving is proportional to your marginal tax rate. A taxpayer in the 31 percent bracket saves 31 ILS for every 100 ILS donated to an approved charity. A taxpayer in the 47 percent bracket saves 47 ILS per 100 ILS donated. Higher-income donors benefit more in absolute terms from the same donation.
The 30 percent cap and carryforward rules
The Section 46 deduction is capped at 30 percent of taxable income in any single tax year. Donations above this cap can be carried forward and deducted in the following tax year (also subject to the 30 percent limit). The carryforward can extend for up to three years, depending on specific circumstances. This means a taxpayer who makes a large one-time donation can spread the tax benefit over multiple years. For self-employed individuals and business owners with variable income, timing large donations in high-income years maximises the tax saving by ensuring the deduction is used at the highest marginal rate rather than being carried forward to a lower-income year.
How to claim the Section 46 deduction on your Israeli tax return
To claim the Section 46 deduction, you must obtain a receipt (kabbalah) from the approved organisation showing the donation amount, your name, and the organisation Section 46 approval number (mispar ishur). Keep all donation receipts as supporting documents. If you are a salaried employee whose taxes are withheld by an employer, you will need to file an annual return (form 1301) or request an end-of-year tax refund form (form 135) through the Israeli Tax Authority to claim the donation deduction and receive a refund of the overpaid tax. Self-employed individuals report donations directly on their annual income tax return alongside other business deductions.
Frequently asked questions
What is Section 46 of the Israeli Income Tax Ordinance?
Section 46 of the Israeli Income Tax Ordinance provides a tax deduction for donations to approved Israeli nonprofit organisations (amutot) and public institutions that have received a specific Section 46 approval from the Israeli Tax Authority. Donations of at least 190 ILS (approximately, updated periodically) to an approved organisation qualify. The deduction reduces taxable income, and the tax saving depends on the donor marginal income tax rate. Donations above 30 percent of taxable income in a single year can generally be carried forward to the next year. The amuta must display its Section 46 certificate on its materials or website.
How is the Section 46 donation deduction calculated?
The approved donation amount is deducted from taxable income before applying the progressive income tax brackets. The tax saving equals the donation amount multiplied by the marginal income tax rate applicable to that slice of income. For example, a 10,000 ILS donation by someone in the 35 percent bracket saves 3,500 ILS in income tax. The deduction is capped at 30 percent of taxable income in any given year, with excess carryable to future years. Bituach Leumi and Mas Briut are not reduced by the donation; only income tax is affected.
Which organisations qualify for Section 46 status in Israel?
Organisations must apply to the Israeli Tax Authority for Section 46 approval, which is granted to amutot (registered nonprofit associations) and other public benefit bodies that operate for educational, scientific, religious, cultural, health, welfare, or similar public purposes. Not all registered amutot have Section 46 status. Donors should ask for the Section 46 certificate (ishur Section 46) before donating if they want to claim the deduction. Most major Israeli universities, hospitals, museums, and established charities hold this status. Political parties and individuals are not eligible.
Can Israeli residents claim Section 46 deductions for donations to foreign charities?
Generally, Section 46 applies only to Israeli-registered organisations with Israeli Tax Authority approval. Donations to foreign charities, even well-known ones, do not qualify for the Section 46 deduction under Israeli tax law. However, some countries have bilateral agreements or arrangements that may allow Israeli residents to deduct donations to recognised organisations in those countries (the US-Israel tax treaty includes some provisions in this area). For most practical purposes, only donations to Israeli Section 46 approved organisations generate an Israeli tax deduction.