Only those companies have to apply the temporary partial relief from Israeli corporate income tax until 11 November 2013, who wish to release their trapped exempt profits that were accrued until December 31, 2011. Companies will have to submit their request by filing Form 969, and pay the deducted tax to the Israeli Tax Authorities those want to apply for the temporary relief.
Companies may willingly choose to pay deducted corporate income tax on their retained earnings that were exempted, even if no actual distribution is made on the basis of the temporary relief given that certain conditions are satisfied. The periodic order gives the facility to pay deducted corporate income tax on relief profits which were previously applied by the company for investment in its subsidiaries. Companies which do not take benefit from this opportunity may face tax assessments which challenge their tax positions regarding investments of trapped exempt profits in subsidiaries.
