The Income and Capital Tax Agreement (2014) between Germany and Israel has published in detail. The treaty was accomplished in the German, Hebrew and English languages and it follows the OECD Model.
The maximum 10% withholding rates are applied on dividends, 5% rates are applied if the beneficial owner is a company, 5% on interest, subject to exceptions and 0% rates are set for royalties. This treaty notices that some articles are deviated from OECD Model. These are articles 5, 7, 8, 10, 11, 13, 17, 19, 23 and 26. Generally, Germany provides for the exemption for avoiding double taxation. Dividends shall be exempted only for the scope they are distributed by a company resident in Israel in which a German company directly holds at least 10% of the capital and the dividends are not deductible in Israel. Israel generally uses for the general credit method for avoiding double taxation.
