Court ruling8/8/2026

Tax Appeal Ends in Agreement on Half the Assessed Amount

The Supreme Court of Israel approved an agreement in a tax dispute concerning the sale of shares. Following the Court’s recommendation, the parties agreed that the company’s tax liability would be half the amount set in the assessment.

Key facts

•Case: Civil Appeal 4239/12
•Court: Supreme Court of Israel
•Hearing: 21.10.2013
•Tax liability: 50% of the assessment
•Settlement: within 60 days
•No costs were awarded in the appeal

Who Took Part in the Dispute

The appellant was A.A.D.I. Holdings Ltd., and the respondent was the Tel Aviv 4 Assessing Officer. The case was heard by Supreme Court Justices Esther Hayut, Uzi Vogelman, and Yitzhak Amit.

What the Parties Agreed

The parties reached an agreement under which the liability arising from the sale of the shares would amount to half the tax assessment. The proceeding was concluded on the basis of the parties’ agreement, reached following the Supreme Court’s recommendation, and not on the basis of a new interpretation of the tax laws.

Timetable for Settlement and Reimbursement of Costs

The parties must carry out the settlement within 60 days. If it is determined that the Tax Authority must refund amounts previously paid by the company, the refund will be made within the following 60 days. In addition, the company will be reimbursed for half of the litigation costs and attorneys’ fees awarded before the court of first instance.

Litigation Costs in the Appeal

The Supreme Court did not award litigation costs in the appeal itself. The judgment concluded the appeal from the Tel Aviv District Court’s judgment dated April 5, 2012, in Income Tax Appeal 111/04.

What this means for you

The agreement shows that a tax dispute may end in a settlement even at the appeal stage before the Supreme Court. For a taxpayer in a similar position, this means that the final amount, the method of implementing the settlement, and the reimbursement of part of the costs previously awarded may be set directly in a judicial judgment issued with the parties’ consent.

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