Mas Rechisha Explained: What First-Time Buyers Need to Know

Mas rechisha — purchase tax — is paid by the buyer, not the seller, and it's one of the costs people most often forget to budget for since it's not part of the headline sale price. Here's how it actually works right now.

The Brackets for a Sole Home (Israeli Residents)

If this is the only apartment you own in Israel and you're an Israeli resident, you benefit from a progressive bracket system with a 0% band at the bottom. These figures are in effect from 16.01.2024 to 15.01.2028, per the Israeli Tax Authority:

• 0% on the portion of the value up to ₪1,978,745
• 3.5% on the portion between ₪1,978,745 and ₪2,347,040
• 5% on the portion between ₪2,347,040 and ₪6,055,070
• 8% on the portion between ₪6,055,070 and ₪20,183,565
• 10% on the portion above ₪20,183,565

It's a bracketed system, like income tax — you don't pay one flat rate on the whole price, only the relevant rate on each slice. For example, on a ₪2,200,000 purchase, you'd pay nothing on the first ₪1,978,745, and 3.5% only on the remaining ₪221,255 — about ₪7,744 in total.

If It's Not Your Sole Home

Buying an additional property, or a sole home as a non-resident, uses a simpler, steeper schedule (in effect through 31.12.2026):

• 8% on the portion up to ₪6,055,070
• 10% on the portion above that

The Oleh Track

New immigrants can be eligible for a meaningfully reduced purchase-tax track on their first home, generally within around seven years of aliyah — the exact brackets and eligibility rules have their own conditions and are worth getting personalized guidance on rather than estimating from a blog post. If you're an Oleh, it's genuinely worth checking before you assume the standard brackets apply to you.

When and How You Pay

You're required to pay mas rechisha within 60 days of signing the sale contract, via the Israeli Tax Authority (Rashut HaMisim). Miss the deadline and interest and penalties start accruing — it's worth setting a reminder the day you sign, not the day your lawyer mentions it.

Run Your Own Numbers

These brackets change periodically, and your actual eligibility depends on your personal situation — this is general information, not tax advice. I'd always recommend confirming your specific numbers with an accountant or the Tax Authority directly before budgeting around them. You can also run a quick estimate, alongside legal fees and agent commission, using the Total Purchase Cost Calculator.

Purchase tax is rarely the thing people expect to be the biggest surprise in their budget — but at the higher brackets, it adds up fast. If you want help thinking through the full cost picture for a specific property, get in touch.