Israel Tax Authority Mandates Digital Capital Declarations from 2027

The Israel Tax Authority announced on Tuesday that starting January 1, 2027, all capital declarations for income tax purposes must be submitted exclusively online. Physical submissions, whether scanned documents via the inquiry system or paper forms delivered by hand, will no longer be accepted. This mandatory digital shift follows a directive signed by Finance Minister Bezalel Smotrich and published in the official records.

To facilitate the transition, a grace period is in effect until January 1, 2027. During this time, individuals can still submit their capital declarations digitally by scanning their paper forms and accompanying documents and uploading them through the Tax Authority's online inquiry system. Alternatively, manual submission at income tax offices remains an option until the deadline.

A capital declaration requires individuals, their spouses, and their children under 18 to report their total assets and liabilities both within Israel and abroad, but only if requested by the income tax authorities. The Tax Authority launched its digital system for capital declarations in May 2025, aiming to streamline the process and provide immediate submission confirmations without the need for physical visits or paper forms.

The new system offers a user-friendly interface with detailed explanations, automatic calculations, document uploads during and after submission, and draft saving capabilities. The move to mandatory digital submissions is intended to enhance the efficiency of declaration management, ensure accurate data entry into the Tax Authority's systems, and enable more effective tracking. Tax Authority Director general, Mr. Shai Aharonovich, has identified this project as a strategic priority, crucial for improving customer service and advancing the authority's goal of becoming a "paperless authority."