In a media interview, the businessman described the foreign country where he ran his enterprises as his "second home." The court drew the obvious conclusion. If that was his second home, Israel was his first. On 1 June 2026, the Tel Aviv District Court dismissed his appeal and held that he was an Israeli tax resident throughout the disputed tax years. This is a District Court ruling rather than binding Supreme Court precedent, but it sets out practical markers for anyone weighing whether to sever Israeli residency. At the heart of the decision lay one simple fact. In several of the years he spent more than half the calendar year in Israel, and he failed to rebut the presumption that his center of life was here.
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TL;DR

• The appeal turned on a single question. Was a businessman who ran an extensive enterprise abroad an Israeli tax resident in the 2009 to 2017 tax years.
• The court held that he failed to rebut the "days presumption," the statutory presumption under the Israeli Income Tax Ordinance that a high number of days spent in Israel establishes a center of life here.
• The decision stood even though the appellant's principal business and economic interests were abroad. His family and social ties to Israel were what tipped the balance.
• The court held that a person can maintain two parallel centers of life, and that there is no obligation to decide exclusively in favor of one country.
• Decisive weight was given to the appellant's own contemporaneous statements. He had previously declared to the authorities that his center of life was in Israel, and his alternative claim to be a "senior returning resident" was rejected.
• On limitations, the appellant's argument for the 2016 year was rejected. For 2009 through 2012 the court found an apparent defect in authority, but dismissed the argument as an improper expansion of pleadings.

Background

The appellant, born in the late 1940s, left Israel in the mid 1980s and built a business abroad. First in a European country, and later in an African country where he established two large companies in agriculture and construction. He became a prominent and well-regarded businessman in that country.

In the tax returns he filed, he reported no income, on the basis that he was a foreign resident. At one stage the assessing officer cancelled an assessment issued for one of the years, after which the appellants filed, in a consolidated submission, returns for 2009 through 2017, again without reporting the income. The assessing officer issued assessments and held that all of the appellant's income, in Israel and abroad, was taxable in Israel. The objections were rejected, and the appeals followed.

The proceeding was bifurcated. The first stage addressed residency alone. Only if the appellant were found to be an Israeli resident would the question of taxable income be heard separately.
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The Days Presumption. When Physical Presence Becomes the Anchor

At the heart of the ruling is the definition of "Israeli resident" in section 1 of the Income Tax Ordinance, under which an individual is a resident if his center of life is in Israel. Alongside a substantive test of the totality of family, economic and social ties, the legislature set a quantitative presumption. A person who spends 183 days in Israel in a tax year, or 30 days in the tax year together with a total of 425 days over that year and the two preceding years, is presumed to have his center of life in Israel. The presumption is rebuttable.

The court held that the days presumption was satisfied in every disputed tax year, and in the years preceding them as well. The figures presented showed that for more than a decade the appellant was present in Israel regularly and frequently, in every month of the year, and in some years for the majority of the calendar year. The court described it as a presumption carrying genuine weight. If residency were assessed only through a substantive review while ignoring the presumption, enacting the presumption would have been pointless.

Practitioners: when a client spends many days in Israel, assume the days presumption applies, and test it against entry and exit records before building a foreign residency position.
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The Burden to Rebut. Comparing Countries Is Not Enough

The appellant argued that his center of life was abroad. His business, his friends and his regular physician were there. The court accepted that he had strong and significant business ties abroad, but held that this did not rebut the presumption. Rebuttal is not exhausted by comparing centers of life. The taxpayer must explain, with persuasive evidence and to a high standard, why the presumption should be disregarded. He must clarify why someone supposedly without a center of life in Israel spends so much time here, enjoying the infrastructure, security and services the state provides.

An adequate explanation might be a specific, defined matter to which all his time in Israel is devoted. The court stressed that it is not enough to show that another center of life is stronger. One must show, affirmatively, why the prolonged presence should be disregarded.

Practitioners: build the rebuttal around affirmative proof of why the client is in Israel, not only around the strength of ties in the foreign country.
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Home, Family and Marriage. The Ties That Decided

The court found that the appellant had a permanent home and residence in both Israel and abroad, at most in both places in parallel. When in Israel, he lived in an apartment registered partly in his name, hosted friends there, held work meetings and interviewed job candidates there. A valuable art collection was kept in that home. The court held that a person who spends most of his time in a place he owns is not a guest.

The decisive tie was the familial one. The appellant claimed separation from his spouse, but the court rejected this. It found an ongoing and meaningful marital connection, a joint bank account into which substantial sums were transferred each year, shared vacations, joint celebrations and broad financial support exceeding any statutory maintenance duty. In a form submitted to the authorities in real time, the appellant declared that he was married, and did not mark "separated." The court held that even if this was an unconventional relationship, the absence of romance does not indicate an absence of ties.

Practitioners: a separation claim does not sever a familial tie where the evidence points to intertwined lives. Contemporaneous declarations, such as marital status forms, will prevail over a later account given during the proceeding.
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Two Centers of Life. No Duty to Decide Exclusively

The appellant argued that the court must compare the countries and determine a single, exclusive center of life. The court agreed that comparison is appropriate, but rejected the assumption that comparison compels an exclusive conclusion. In the modern reality, a person can simultaneously maintain substantial and strong ties in several places, and in certain cases hold two parallel centers of life.

The court relied on case law recognizing more than one place of residence, and on the definition of resident of a locality in the Ordinance, under which more than one center of life can be recognized within Israel itself. If so, why could there not be two centers outside Israel. The court emphasized that in this case it did not need to decide whether two centers existed, because the days presumption was not rebutted in any event, and the center of life in Israel was established.

Practitioners: do not rely on the argument that the court must choose between two countries. The court is willing to recognize two centers of life, and such an argument may work against the client.
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Statements in Real Time. When the Taxpayer Testifies Against Himself

The court gave greater weight to the appellant's contemporaneous documents and statements than to his testimony during the proceeding. In a form submitted to the authorities he declared that he was an Israeli resident, and in an application to the National Insurance Institute he asked to be treated as a returning resident and stated that his center of life was in Israel. In a media interview he described the foreign country as his "second home," and that statement, the court held, indicates that Israel is his first home. In cross examination he also confirmed that in some years he spent more time in Israel than abroad. The court held that subjectively, too, the appellant viewed himself as an Israeli resident.

Against this backdrop, the alternative claim was also rejected, namely that the appellant was a "senior returning resident" entitled to broad tax benefits. To establish that status he had to prove that he was a foreign resident in the years preceding the disputed tax years. But the days presumption was satisfied in those years too, and no substantive difference between the periods was found. The claim was rejected.

Practitioners: every declaration to the tax authority, to the National Insurance Institute or to the media is evidence that may return to the client. Ensure consistency between the claimed status and past declarations, and verify eligibility for senior returning resident status before relying on it.
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A Foreign Legal Opinion. Why It Was Not Enough

The appellant submitted an expert opinion on foreign law concluding that he was a resident of that country. The court held that this changed nothing. Foreign law does not bind the Israeli court, and the two forums may reach different conclusions resting on different legal systems. The foreign expert ignored material factual data, proceeded from a mistaken assumption about the marital separation, and did not weigh the days presumption under Israeli law. In doing so, the court noted, the expert committed the very omission the appellant had attributed to the assessing officer. He did not examine the situation in the competing country.

Practitioners: an opinion on foreign law must rest on the full factual matrix, including the ties to Israel and the days presumption, or its weight will erode.
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FAQ

What is the days presumption in tax residency?A statutory presumption under the Income Tax Ordinance that if an individual spent 183 days in Israel in a tax year, or 30 days in the year and 425 days over that year and the two preceding years, his center of life is in Israel. The presumption is rebuttable, but the burden to rebut it is heavy.

I left Israel years ago. Is that enough to be treated as a foreign resident?Not necessarily. Even someone who left decades ago can be treated as an Israeli resident if he continues to spend many days here and maintains a routine of life here. In this ruling, frequent presence even after about 40 years actually demonstrated the strength of the ties to Israel.

If most of my business is abroad, am I not a foreign resident?A strong business tie abroad is not sufficient on its own. The court examines the totality of ties, and family connections appear in the Ordinance before economic ones. The place where the family lives is a central consideration.

Does separation from a spouse sever the familial tie?No, where a meaningful and ongoing connection is in fact maintained, with broad financial support, shared residence during stays in Israel and intertwined lives. Contemporaneous declarations of marital status are important evidence.

Can a person be a resident of two countries?Under Israeli domestic law, the court recognized the possibility of two parallel centers of life. Where there is no tax treaty between the countries, there is no tie-breaker rule, and Israeli tax may apply regardless.

I spent years abroad. Will I qualify as a senior returning resident when I come back?Not automatically. To establish the status you must prove a continuous period of foreign residency before returning. In this ruling the claim was rejected because the days presumption was satisfied in the preceding years, so the appellant did not prove he was a foreign resident in those years.

When can the limitations period of an assessment be extended?An extension of one additional year requires approval from the director or a deputy director authorized for the relevant section. In this ruling an apparent defect was found in the authority of the official who extended the period for 2009 through 2012, but the argument was rejected because it was raised for the first time in summations and constituted an improper expansion of pleadings. The limitations argument for 2016 was rejected on its merits, because the time count ran from the date the new return for that year was filed.
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Summary

The ruling illustrates how powerful an anchor physical presence in Israel is in residency law. A businessman who built the bulk of his economic activity abroad was found to be an Israeli resident, because he spent many days here and maintained strong family and social ties. The days presumption was described as one carrying genuine weight, and rebutting it requires a persuasive, affirmative explanation of why the taxpayer is in Israel. The appellant's contemporaneous statements, in which he viewed himself as an Israeli resident, reinforced the outcome. The recognition that two parallel centers of life are possible narrows the argument that the court must decide in favor of one country alone. On limitations, the argument for 2016 was rejected, and for 2009 through 2012 an apparent defect in the authority to extend was found, but the argument was dismissed as an expansion of pleadings. The matter was returned to the assessment stage to quantify the taxable income.
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CTA

Considering relocating your center of life abroad and severing Israeli tax residency?Received an assessment finding you an Israeli resident despite business activity abroad?

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