Parents wishing to buy a property in the name of their minor child: IT IS POSSIBLE

In Israel, the capital gain on real estate is generally calculated by subtracting the sale price of the real estate from the original purchase price, to which are added the acquisition costs and the expenses related to improvements made to the real estate. .

If a parent buys real estate on behalf of their child, the capital gain will be calculated based on the original purchase price, acquisition costs and improvement expenses, just like any other real estate purchase. For parents who are already owners, the purchase in the name of a child will be taken into account as a second good, it will therefore be necessary to pay the normal acquisition tax.

In Israel, there are tax provisions that impose taxes on gifts of real estate, as well as transfers of ownership of real estate to family members.

If the property is resold while the child is a minor, the profit from the sale will be subject to the capital gain; on the other hand, if the property purchased in the name of the minor child and resold 18 months later and the child is an adult, there will be no added value to pay!

It is therefore important to consult a competent lawyer or tax advisor in Israel to understand the potential tax implications of purchasing real estate in the name of a child, as well as to determine the best way to structure the transaction in order to minimize tax liabilities.