Resident withholding tax (WHT)
WHT must be deducted on payments to residents if such payments exceed ILS 2,500 according to the percentage or amount specified in the WHT certificate issued by the Tax Department. In case the WHT certificate is not provided, the payer must deduct 10% of the payment and transfer it to the Tax Department.
According to Income Tax Law, a resident person who pays any amount to a non-resident that is subject to tax under the provisions of this law shall withhold tax at a rate of 10% of the payment amount as a final tax and transfer it to the account of the Tax Department. If the resident fails to withhold the required tax, it shall be collected from the resident as a party responsible for paying it.
WHT on dividend
Currently, dividends are exempt from income tax, and there is no WHT on dividends. However, it is expected that a 10% tax on dividend will be imposed.