The signing date is important to third parties
- Buying an apartment in Israel
- Contract Structure
As stated, it is important to determine the date on which the contract is also entered into for external needs, for example, the tax authorities. Under section 73, the transaction must be reported within 30 of the date of sale, that is the day the contract was entered into.
Lien in reporting will result in a fine.
The amount of purchase tax is also determined by the date of signing. By law, the seller must pay an appreciation levy for the period up to the date of signing, and from that date onwards an improvement levy applies to the buyer.
The date of signing is also important for extreme cases of conflicting transactions in real estate, regarding the right of way between creditors. And if the seller has committed to ‘exclusivity’ with a broker, it is important to know whether the signature was made during the exclusivity period, reporting a trust to the real estate tax authorities (under section 74 of the Real Estate Taxation Act).
The conclusion is that care must be taken to correctly record the date on which the contract was entered into.