Company: INCR
Filing Date: 2025-05-01
Form Type: 20-F
Source: 0001641172-25-007971
Chunk: 151

Company: Intercure Ltd.
Filing Date: 2025-05-01
Form: 20-F
Item: Item 10
Chunk 151
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 on their capital gains in order to refrain from withholding at source at the time of sale.
 
It should be noted that in the event that the real capital gain realized by an individual shareholder is not exempt from tax in Israel, the tax rates applicable to Israeli resident individual shareholders should generally apply.
 
In some instances where our shareholders may be liable for Israeli tax on the sale of their ordinary shares, the payment of the consideration may be subject to the withholding of Israeli tax at source.
 

105
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Taxation of Dividend Distributions
 
Israeli Residents
 
Israeli resident individuals are generally subject to Israeli income tax on the receipt of dividends paid on our ordinary shares, other than bonus shares (share dividends). As of January 1, 2012 and thereafter, the tax rate applicable to such dividends is generally 25%. With respect to a person who is a “substantial shareholder” (as defined above) at the time the dividend is received or at any time during the preceding 12-month period, the applicable tax rate is 30%. Dividends paid from income derived from Preferred Enterprises and Preferred Technology Enterprises will generally be subject to income tax at a rate of 20%.
 
As of January 1, 2024, Israeli resident shareholders who are individuals with taxable income that exceeds NIS 721,560 in a tax year (linked to the Israeli consumer price index each year) will be subject to an additional tax at the rate of 3% on the portion of their taxable income for such tax year that is in excess of NIS 721,560 (linked to the Israeli consumer price index each year). For this purpose, taxable income includes taxable capital gains from the sale of our shares and taxable income from dividend distributions. An additional 2% surtax was introduced in 2025 and applies specifically to taxable capital income exceeding ILS 721,560 annually, including income from sources such as dividends, interest, capital gains, and passive royalties. This surtax stacks on the existing 3% general surtax on all income above the threshold, resulting in a 5% total surtax on qualifying capital income.
 
Dividends paid to an Israeli resident individual shareholder on our ordinary shares will generally be subject to withholding tax at the rates corresponding with the income tax rates detailed above unless we are provided in advance with a withholding tax certificate issued by the Israel Tax Authority stipulating a different rate.
 
Notwithstanding the above, dividends paid to an Israeli resident “substantial shareholder” (as defined above) on publicly traded