Introduction:

Parents of a child who is entitled to a full (100%) Disabled Child Benefit are entitled to a reduced purchase tax of 0.5% of the value of the property, when purchasing a home in which the child will live
In addition to the benefit, the child's permanent medical disability should be established as 100% by National Insurance Institute Medical Committee
When purchasing a single residence, valued up to NIS 2,500,000 (as of 2017), there is a tax exemption on the first payment bracket.
For more information, see Regulation 11 of the Property Tax Regulations (Improvement and Acquisitions) (Purchase Tax)

Parents of a child who is entitled to a full (100%) Disabled Child Benefit are entitled to a reduced purchase tax in accordance with the conditions detailed below.

  • In addition to the benefit, the child's permanent medical disability should be established as 100% by National Insurance Institute Medical Committee
  • Those who buy a piece of land to build on, are eligible to pay a reduced income tax of 0.5% on the part of the land that the house they will live in will be built on (regular income tax is paid on the rest of the property) and on the condition that the house is built within 2 years.

Benefit Rate

Who is eligible?

  • Parents of a child receiving a full (100%) Disabled Child Benefit.
  • In addition to the disabled child benefit, the child's permanent medical disability must be established as 100% by a National Insurance Institute committee. (See details in the "How to claim it" section.)

How to claim it?

Lands Taxes - Central Bureau
Kanfei Nesharim 5
PO Box 1170, Jerusalem 91010
Fax: 02-6559404
  • The Help centers, services and resources of the tax authority can be consulted for assistance.
  • After submitting the request, the family will be referred to a National Insurance Institute medical committee to determine the degree of the child has 100% permanent medical disability. For more information see the Purchase Tax Discount Medical Committee.
  • If the medical establishes that the child has 100% permanent medical disability, the family will be directed to Family Court to confirm eligibility for the exemption.
  • The parents must go to court as the minor's legal guardians with a request for declaratory relief in order to receive the authorization to make use of the benefit to which they are entitled.
  • The Guardian General will respond to the request with the minor’s best interest in mind.
  • The discount will be given after obtaining a judgment approving the application.

Residence registered under the child's name

  • If parents want to transfer the rights to the residence from the child to another person in the future, approval from Family Court will be required.
  • When the child reaches the age of 18, as long as he/she has no appointed guardian, the child may do as he/she pleases with the property.
  • In accordance with the Ministry of Construction's “Unavailability” (ee-zminut) procedure, the child will not lose his/her rights related to acquiring a residence in the future, but only if the home purchased in the child’s name is the only home owned by the parents, and they live there.
  • It would be enough that parents inherit a small part of another residence to disqualify the child from entitlement to benefits granted by the Ministry of Construction for people with disabilities (such as obtaining a mortgage on special terms or rental assistance). Also, it is not known if or for how long the "Unavailability" (ee-zminut) procedure will remain in force.

Receiving a retroactive discount

  • Parents who have already paid a purchase tax, and meet the criteria regarding real estate tax laws, and receive the proper approvals from the National Insurance Institute and the Court, as detailed above, may request exemption for up to 4 years retroactively.

Please note

  • A purchase tax refund may only be received twice in a person's lifetime, and therefore, if the parents make use of the child's right, he/she would have only one opportunity to use the discount in the future.
  • There is no need to register the residence under the child's name.

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