דלג לתוכן העמוד דלג לתפריט אתר דלג לקישורים תחתונים כניסה לחשבונך
דלג לתוכן העמוד דלג לתפריט אתר דלג לקישורים תחתונים כניסה לחשבונך
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Private Accounts

Business Accounts

Please note

Discount Bank and the Discount Group are engaged in various areas of activity subject to Israeli and international regulatory provisions, which are updated from time to time. This regulation may also apply to the Bank's customers, for example through tax reporting and payment obligations, and may affect their rights in assets deposited in the Bank.
We would like to draw your attention to some issues below, and recommend seeking external independent advice, inter alia, regarding foreign tax credit: 
  1. On January 1, 2023, new U.S. legal provisions (Section 1446(f) to the U.S. Internal Revenue Code) came into effect, dealing with obligations of tax withholding and reporting in respect of securities classified as a publicly traded public partnership (PTP), engaged in trade or business in the United States. Due to these provisions, obligation to withhold tax to the U.S. Tax Authority (IRS) may apply to 10% of proceeds of the sale of rights in the PTP and to the receipts for certain disputes from the PTP, thus in addition to the obligation to withhold tax to the Israel Tax Authority according to Israeli law. In addition, the customer may be required to submit a tax return to the IRS.
  2. Pursuant to U.S. law provisions and the Hiring Incentives to Restore Employment Act (HIRE Act), of January 1, 2017, enacted by its virtue, U.S. tax may apply for the holding of certain assets based on U.S. securities and/or certain indices. Such securities and indices may include, inter alia, U.S. securities (including indices on the Tel Aviv Stock Exchange that include U.S. securities above a certain percentage). Obligation will apply to equity linked swaps, options, U.S. securities-based negotiable derivative products, ETN, etc. Withholding tax to IRS will apply following the distribution of dividends at the underlying asset level. In addition, tax will be withheld to the Israel Tax Authority according to Israeli law.  
  3. Trading and holding securities issued outside Israel are subject to foreign law provisions applicable to the securities, including, inter alia, taxation provisions, which may apply to the holders of securities, even if they are not residents of that country. Thus, for example, according to American law provisions, estate tax will apply to estate assets in the United States, even if the deceased is not American (subject to exemptions in American law). Hence, U.S. estate tax may apply to securities issued by a U.S. company, even if the deceased is not an American resident or citizen. Therefore, to the extent that account holdings include securities issued outside Israel, we recommend seeking independent external advice regarding foreign law provisions. In addition, the Bank reserves its right, at its discretion and/or to the extent required by law, to demand confirmation for tax payment to foreign tax authorities (or the existence of a tax exemption) as a condition to carry out transactions in account assets.
  4. Tax treaty – When receiving income derived from securities issued by entities incorporated in certain countries (other than Israel or the United States), the tax withheld from such income in those countries may be at the maximum tax rate, which may exceed the tax deduction rate set forth in the double tax avoidance agreement between the State of Israel and that country, if any. In accordance with the Israel Tax Authority directions, tax supplementation in Israel is in relation to the tax rate set forth in the relevant foreign tax treaty, or according to internal law there, whichever is lower. Therefore, the total rate of tax withheld for income of interest and dividends from such foreign securities, may exceed the maximum tax rate in Israel. Since a tax benefit may apply by virtue of a tax treaty between the State of Israel and another country, we recommend seeking independent external advice regarding the possibility of utilizing tax benefits as a result of the implementation of such a treaty. The aforesaid constitutes no legal or tax advice or substitute thereof.   
  5. Pursuant to U.S. Treasury Notice No. 2024-26, effective August 16, 2024, and until further notice, the dividend income clause of the US-Russia double taxation treaty should not be implemented. That is, the tax rate on a Russian resident's income from dividend payments of American origin, will be at a maximum tax rate of 30%.  
This document was prepared by Israel Discount Bank Ltd., to the best of its understanding of the law provisions and the Israel Tax Authority directions.
The contents of this document should not be relied upon as a binding interpretation of the law provisions and/or the Israeli Tax Authority directions.
The information specified above is general and constitutes no legal and/or tax advice. The information specified above is no substitute for seeking tax advice, and does not bind Israel Discount Bank Ltd. Every customer must consult with a tax advisor in accordance with his own data.