Tel Aviv Court Says Nigerian Businessman Owes Israeli Taxes

The Tel Aviv District Court has rejected tax appeals filed by Israeli businessman Chaim Tzach over the 2009 to 2017 tax years, finding that he failed to prove he was a foreign resident, or alternatively a veteran returning resident, during that period. Judge Yardenah Seroussi ruled that despite his strong business and financial ties to Nigeria, he could not rebut the legal presumption that his center of life remained in Israel.

Tzach, an Israeli citizen, left his post as Herzliya municipal CEO in 1985 and moved to England to build a business career. In 1991 he founded businesses in Nigeria in agriculture and poultry, later moving there permanently. The ruling said he runs two large and successful Nigerian companies, one breeding chicks for the broiler sector and one in construction.

The dispute began after Tzach filed a 2016 tax return in 2017 without declaring income, saying he was a foreign resident. He then filed returns for 2009 to 2017 that also omitted overseas income. The tax assessor rejected that position and held that he was an Israeli resident, meaning all of his income, in Israel and abroad, was taxable in Israel. Tzach argued that since leaving Israel and his family in 1985, his center of life was Nigeria, where he had his businesses, friends, home, regular doctor, public activity and reputation. He said he remained married but lived separately from his wife, and that his financial support for her and their daughters was a family duty, not proof of Israeli residence.

The court accepted the tax authority’s evidence that he spent many days in Israel each year, kept a permanent home, bank accounts, credit card, car and driver’s license there, received medical care, voted in elections and maintained substantial family and social ties. Seroussi found the “days presumption” applied in every disputed year, and that in 2009 to 2015 he was in Israel more than 183 days annually. She also said the Tel Aviv apartment, registered in his name, was used by him when he came to Israel and that his ties with his wife remained significant and ongoing. The appeals were dismissed, the case was sent back to the assessment stage to calculate the taxable income, and Tzach and his wife were ordered to pay 40,000 shekels in costs.