Distributing Assets to Heirs in Israel
Distributing assets to heirs in Israel can be a complex and sensitive process. In this article, we will provide an overview of the key considerations and legal requirements for distributing assets to heirs in Israel.
Understanding the Legal Framework.
In Israel, the law governing inheritance and succession is the Succession Law of 1965. This law establishes the rules and procedures for distributing assets among heirs and outlines the rights and responsibilities of both heirs and executors.
Under Israeli law, there are two types of succession: testate succession and intestate succession. Testate succession occurs when the deceased person leaves a valid will, while intestate succession occurs when the deceased person did not leave a will.
Wills and Estate Planning.
Wills are an important tool for managing the distribution of assets to heirs in Israel. A will allows the testator (the person making the will) to determine how their assets will be distributed after their death. The testator can specify which assets should go to which heirs, and can also appoint an executor to manage the distribution of assets.
It is important to note that Israeli law recognizes only written wills, which must be signed by the testator in the presence of two witnesses. Additionally, Israeli law does not recognize holographic (handwritten) wills or oral wills.
Intestate Succession.
When a person dies without a will in Israel, the rules of intestate succession apply. Under these rules, the deceased person’s assets are distributed among their heirs in accordance with a strict hierarchy. The first to inherit are the deceased person’s spouse, children, and parents, in that order.
If there are no surviving spouse, children, or parents, the deceased person’s siblings or their children (the deceased person’s nieces and nephews) will inherit the assets. If there are no surviving siblings or their children, the deceased person’s grandparents or their descendants (the deceased person’s aunts and uncles) will inherit the assets.
Distribution of Assets.
Once the heirs have been identified, the distribution of assets can begin. The executor, if appointed, is responsible for managing the distribution of assets and ensuring that all heirs receive their fair share. The executor must pay any outstanding debts and taxes, and distribute the remaining assets among the heirs.
If there are disputes between the heirs regarding the distribution of assets, these disputes can be resolved through the courts. However, it is generally preferable to try to resolve disputes through negotiation or mediation, in order to avoid the time and expense of court proceedings.
Inheritance and Taxes.
Inheritance in Israel is subject to both inheritance tax and capital gains tax. Inheritance tax is based on the total value of the assets being inherited and is calculated on a sliding scale. The tax rate ranges from 1% to 10%, depending on the value of the assets and the relationship between the deceased person and the heir.
Capital gains tax is levied on the sale of inherited assets and is based on the difference between the sale price and the fair market value of the asset at the time of inheritance. The tax rate for capital gains is determined by the length of time that the asset was held.
Distributing assets to heirs in Israel – Conclusion.
Distributing assets to heirs in Israel can be a complex and challenging process, especially when there is no will in place. However, by understanding the legal framework, creating a will and engaging in estate planning, and working with experienced legal and financial professionals, it is possible to ensure that the distribution of assets is managed in a fair and efficient manner. If you have questions about distributing assets to heirs in Israel, it is recommended to seek the advice of a qualified legal or financial professional.
Eli Shimony – Israeli law firm represents clients on all legal matters in Israel. For any questions please contact us and we will be happy to assist.
By email: [email protected], By phone: +972-52-2769773, +972-3-5507155.
The above is only general information and does not replace legal advice which is usually necessary before taking legal proceedings.