Israel Mas Shevach (Property Capital Gains Tax) Calculator 2025
Calculate Mas Shevach (property capital gains tax) in Israel 2025. Primary residence exemption for owners who lived there 18 of the last 24 months. Investors pay 25% on the real (inflation-adjusted) gain.
Calculate Mas Shevach (property sale capital gains tax) in Israel for 2025. Primary residence owners who lived in the property 18 of the last 24 months are typically exempt. Investors pay 25 percent on the real gain.
Mas Shevach (tax owed)
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Nominal gain
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Inflation adjustment
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Real gain (taxable base)
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Tax or exemption status
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Your breakdown
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How Mas Shevach is calculated in Israel
The taxable amount for Mas Shevach is the real gain, defined as the sale price minus the inflation-adjusted purchase cost. The purchase cost is multiplied by the ratio of the CPI at the time of sale to the CPI at the time of purchase. This adjustment eliminates the portion of price gain that simply reflects general inflation, leaving only the real increase in value as taxable income. The 25 percent rate is then applied to this real gain. In this calculator, the inflation adjustment is approximated using a compound annual inflation rate over the years held, which gives a reasonable estimate but may differ from the official calculation using the exact monthly Madad index values. For a binding figure, use the official Israel Tax Authority calculation tool on the misim.gov.il website.
Primary residence exemption conditions
The primary residence exemption requires that the seller owned and lived in the property as their only residential apartment for at least 18 of the 24 months immediately preceding the sale date. If the seller owns even a fractional share in any other residential property in Israel, the exemption does not apply. The exemption is available once every 18 months per seller, regardless of how many primary residences they have sold in total. Couples who jointly own the property must both meet the conditions, and the exemption is applied to the couple together. A seller who does not qualify for the full exemption but meets partial conditions may qualify for a proportional exemption on the pre-qualifying portion of the holding period under a separate linear calculation.
Filing and payment requirements
Even if the sale is fully exempt from Mas Shevach, the seller is generally required to file a declaration with the Israel Tax Authority within 30 days of completing the sale (the date the purchase agreement was signed, not the date of key handover). The declaration confirms whether an exemption applies and provides the basis for the tax calculation. If tax is owed, it must be paid within 40 days of the sale date. Late payment triggers indexation (linking the outstanding amount to the CPI) plus interest. The filing is done online via the Israel Tax Authority portal or through a licensed real estate lawyer or tax adviser. Real estate lawyers handling the transaction typically assist with this filing as part of their service.
Frequently asked questions
What is Mas Shevach (property capital gains tax) in Israel?
Mas Shevach is the Israeli capital gains tax on the sale of real estate. The term translates literally as appreciation tax. For most residential properties, the relevant rate is 25 percent applied to the real (inflation-adjusted) gain, not the nominal gain. The real gain is calculated by inflating the original purchase price by the change in the Israeli consumer price index (CPI) between the purchase date and the sale date. Only the gain above the inflation-adjusted purchase cost is taxable. Properties purchased before January 1, 1998 have a partial exemption for the pre-1998 period. Properties purchased after that date are fully subject to Mas Shevach unless a specific exemption applies.
When is a property sale exempt from Mas Shevach in Israel?
The main exemption from Mas Shevach is the primary residence (dira yachida) exemption. A seller is exempt from Mas Shevach on the sale of their only residential property if they have lived in it as their primary home for at least 18 of the 24 months immediately before the sale. The exemption can only be claimed once every 18 months. If the seller owns additional properties, the exemption does not apply even if they live in the property being sold. New immigrants (olim hadashim) have a separate exemption for properties purchased within a set period after immigration. There is also an exemption for certain inherited properties and for heirs selling an inherited primary-residence property within two years of inheriting it.
How is the real gain calculated for Mas Shevach purposes?
The taxable gain for Mas Shevach is the real gain, not the nominal gain. The calculation works as follows: first the purchase price is inflated by the change in the Israeli CPI (Madad) between the month of purchase and the month of sale. This inflation-adjusted purchase cost is then subtracted from the sale price to get the real gain. Expenses of sale (agent commission, lawyer fees) and allowable improvement costs can be added to the purchase price before adjusting for inflation, reducing the taxable gain. The 25 percent tax is then applied to the real gain only. If the sale price is below the inflation-adjusted cost, there is a real loss and no tax is payable. This calculator uses a simplified annual inflation input rather than the exact monthly CPI index, which is used in the official calculation.
Can I sell investment property in Israel without paying Mas Shevach?
For investment properties (properties that are not your primary residence), Mas Shevach is generally payable at 25 percent on the real gain. There is no blanket exemption for investment properties. However, there are a few situations where tax may be reduced or deferred: losses on other property or investment asset sales in the same tax year can be offset against the Mas Shevach gain; properties that were previously declared as a primary residence for the correct period qualify for the primary residence exemption on sale; and there are specific reliefs for reinvestment in certain scenarios. Sellers should file a Mas Shevach declaration within 30 days of the sale agreement and make any tax payment within 40 days. Late payment attracts interest and penalties under the Israeli tax rules.