What Is Arnona? A Beginner's Guide to Israeli Municipal Tax for Renters

29 October 202612 min read

You've found an apartment, the landlord has mentioned arnona in passing, and now you want to know what you're actually on the hook for. Arnona (municipal tax) is the local property tax your city hall, the iriya, charges the person living in an apartment. It funds garbage collection, street lighting, parks, local infrastructure and emergency services. In a standard long-term rental, that person is you.

Once you understand the formula, the bill is predictable. New immigrants can also get a large discount for a full year. Nobody will apply for it on your behalf, though, and nobody will move the bill into your name unless you do it.

Who actually pays arnona

Israeli municipal law charges arnona to the machzik, the actual occupant or holder of the property. The owner is only responsible when the apartment sits empty. Standard leases spell this out: the tenant pays the municipality directly for the length of the lease.

The bill is attached to a name, and that has consequences. While the account still belongs to the previous tenant or the landlord, no discount you qualify for can be applied to it, and you have no clean line between your charges and whatever the last occupant left behind. Landlords have their own reason to care, since unpaid municipal bills can lead to debt collection against the owner and even frozen bank accounts. Both sides benefit from switching the account quickly, and the steps are below.

How the bill is calculated

A tape measure stretched across the tiled floor of an empty Israeli apartment toward the balcony

The basic formula is simple:

Annual arnona = apartment size in square meters × your city's rate per square meter

Each municipality sets its rates every year in a document called the tzav arnona (arnona order), within limits set by the Ministry of Interior and the Ministry of Finance. A few things move your number.

Size comes first, and it's trickier than it sounds. Cities don't all measure the same way. Some count net interior space, while others include external walls, shared corridors, balconies or storage rooms, so the square meters on your arnona bill may not match the figure you had in mind. Israeli listings also describe apartments by rooms rather than square meters, and they count every room, not just bedrooms: a 3-room apartment is two bedrooms plus a living room. If that convention is new to you, here's what a 3-room apartment in Israel actually means. Either way, ask about square meters separately.

Location matters next. Cities divide themselves into zones with different tariffs. In Tel Aviv, high-demand areas such as the streets around Rothschild or near the beach carry noticeably higher per-meter rates than outer residential neighborhoods, and peripheral cities tend to charge less again.

Then there's how the property is classified. Residential space is taxed at a lower rate per meter than offices or commercial space, so if a unit looks unusual, confirm it's registered as a home.

Arnona is billed for the calendar year, January to December. You can pay every two months, by monthly standing order from your bank (hora'at keva), online by credit card, or in one annual payment. For most renters, the hora'at keva is the sensible default: the cost is spread evenly and you won't miss a bill because it went to the wrong mailbox.

One habit will save you guesswork. Before you sign, ask the landlord for the most recent arnona bill. It shows the registered square meters and the real charge, so you can budget with an actual number.

The oleh discount: generous, and only if you ask

New immigrants (olim chadashim) are entitled to a substantial arnona reduction under national regulations dating from 1993. The main rules:

The discount is generally between 70 and 90 percent off residential arnona, depending on the city. Tel Aviv and Jerusalem offer up to 90 percent, and Netanya offers 81 percent.
It covers only the first 100 square meters. Anything beyond that is charged at the full rate.
It lasts 12 consecutive months.
It has to be used within 24 months of your aliyah date, as listed on your Teudat Oleh (immigrant certificate).
You can claim it once in Israel, and it isn't retroactive.

The non-retroactive rule is where people lose money. Months you spend not having applied are months at full price, and you don't get them back. Apply to your city's municipal tax department as soon as the account is in your name.

You'll typically need:

Your Teudat Oleh or Teudat Zakaut
Your Teudat Zehut (Israeli ID card) showing your new address
A signed rental contract (hoseh sekhirut) covering at least 12 months
The latest arnona bill for the apartment, which carries the property's account number
If you're moving from another city, a release confirmation from your previous municipality showing how many discount months you've already used

Roommates change the math. If you're an oleh sharing with people who aren't, the discount applies proportionally to your share of the apartment's area. Hold a third of the space and the discount covers your third.

Percentages, documents and procedures vary between cities and change over time, so check your own municipality's current rules. This is general information, and it isn't tax or legal advice for your particular situation.

Timing the discount

With 24 months to use a 12-month benefit, you have a choice to make. If your first year is in a small room or a shared flat and you have a concrete plan to move into a larger place of your own in year two, holding the discount back can save more, because a bigger apartment means a bigger bill (up to the 100 square meter cap).

The window doesn't stretch, though. If your move slips, you can run out of time. Ask your municipality how late you can start the discount and still get the full year before you decide to wait.

Our recommendation: if you're settled in a reasonably sized apartment with a 12-month lease, take the discount now. Waiting only makes sense when the bigger move is actually planned.

Moving the bill into your name

An arnona bill, a signed lease and a phone laid out on a kitchen table

The official term is a change of occupier, and the process is short if you have the paperwork ready.

On move-in day, take the property's account number (mispar nesech, sometimes written mispar hanas) from the last bill. Photograph the water and electricity meters at the same time so utility readings are documented too.
Fill out your city's change-of-occupier form (tofes chilufei machzikim), online or in person at the iriya.
Attach the full signed lease, a copy of your ID or passport, the landlord's ID or details, and a copy of the previous arnona bill.
Choose how you'll pay: credit card online, bi-monthly payment slips, or a hora'at keva.

Ask the landlord for a copy of their ID and the latest bill a few days before you get the keys, so you're not chasing them after you've moved in. Keep whatever confirmation the municipality sends you as your record of when the account became yours. If you're an oleh, submit the discount application right after. For the wider sequence of viewing, signing and moving in, see our step-by-step guide to renting an apartment in Israel.

Where newcomers get stuck

Short leases are the first snag. Most councils won't register a change of occupier for a contract under one year. The landlord stays officially liable and usually builds an estimate of arnona into the rent. That can be perfectly convenient, but you can't claim an oleh discount on a bill that isn't in your name. If you're signing for less than a year, ask how much of the rent covers arnona and have it written into the contract.

Split apartments are the second. A dira mefuzelet (split apartment) is a single unit that has been subdivided, legally or not, into two or more smaller self-contained flats. These often lack their own arnona account, which means you can't transfer the bill or claim a discount, and you end up in an informal split-payment arrangement with the landlord. If the discount is part of your budget, ask before signing whether the unit has its own arnona account number. If the landlord can't show you one, budget for paying full arnona through the landlord.

Budgeting: keep the four numbers apart

Asking rent in Israel is quoted monthly in shekels (₪), and it covers rent only. Your real monthly cost has three more lines:

Cost	Who you pay	How often	What drives it
Rent	Landlord	Monthly	The apartment and the market
Arnona	Municipality	Annual bill, usually paid monthly or every two months	Size, zone, property use
Va'ad bayit	Building committee or management	Monthly	Shared amenities and maintenance
Utilities	Electric company, local water company, gas supplier	Based on use	Your consumption

Va'ad bayit (building committee fee) pays for the shared parts of the building: stairwell cleaning, elevator upkeep, entrance lighting, shared gardens. It's separate from both rent and arnona, and it tends to be higher in modern buildings with elevators or a doorman. The glossary of Israeli real-estate terms covers the rest of the vocabulary you'll meet in listings and contracts.

When two apartments have similar rent, these other lines often decide which one is actually cheaper, so ask about all four at every viewing. If you're still searching, Dorit sends matching listings from Facebook groups, Yad2, Madlan and other sources straight to WhatsApp, which leaves you more time for those questions.

Arnona stops being a mystery once you've seen one real bill. Ask for the latest one before you sign, switch the account into your name the week you move in, and if you made aliyah within the last two years, file the discount application alongside the transfer. Rules and rates shift from city to city and year to year, so confirm the details with your municipality before you count on any number.

What kind of apartment are you looking for?

Frequently asked questions

In a standard long-term rental, the tenant pays. Israeli municipal law charges arnona (municipal tax) to the machzik, the person actually occupying the property. The owner only becomes responsible when the apartment sits empty. Most leases say this outright: the tenant pays the municipality directly for the length of the lease. The bill is tied to a name, so whose name is on it matters. If the account still belongs to the landlord or the previous tenant, no discount you qualify for can be applied, and your charges get tangled up with whatever the last occupant left unpaid. Landlords want the switch too, since unpaid municipal bills can lead to debt collection against the owner. Move the account into your name the week you move in.

Annual arnona equals the apartment's size in square meters multiplied by your city's rate per square meter. Each municipality sets its rates every year in the tzav arnona (arnona order), within limits set by the Ministry of Interior and the Ministry of Finance. Size is trickier than it sounds, because cities measure differently: some count net interior space, while others add external walls, shared corridors, balconies or storage rooms. Location also moves the number. Cities are split into zones, and in Tel Aviv the streets around Rothschild or near the beach cost more per meter than outer neighborhoods. Residential space is taxed at a lower rate than offices or shops. For a real figure, ask the landlord for the latest bill before you sign.

New immigrants (olim chadashim) generally get between 70 and 90 percent off residential arnona, depending on the city. Tel Aviv and Jerusalem offer up to 90 percent, and Netanya offers 81 percent. The discount covers only the first 100 square meters, and anything beyond that is charged at the full rate. It lasts 12 consecutive months and has to be used within 24 months of the aliyah date on your Teudat Oleh. You can claim it once in Israel, and it isn't retroactive, so any months before you apply are billed at full price. If you share with roommates who aren't olim, the discount applies only to your share of the area. Percentages and rules change, so check your municipality's current terms.

You'll typically need your Teudat Oleh or Teudat Zakaut, your Teudat Zehut (Israeli ID card) showing your new address, a signed rental contract (hoseh sekhirut) covering at least 12 months, and the latest arnona bill for the apartment, which carries the property's account number. If you're moving from another city, add a release confirmation from your previous municipality showing how many discount months you've already used. The application goes to your city's municipal tax department, and nobody files it for you. Submit it as soon as the account is in your name, because the discount won't cover months before you applied. Document lists can differ between municipalities, so confirm yours before you go.

File a change of occupier with your municipality using the city's form, the tofes chilufei machzikim, online or in person at the iriya (city hall). On move-in day, take the property's account number (mispar nesech, sometimes written mispar hanas) from the last bill, and photograph the water and electricity meters at the same time. Attach the full signed lease, a copy of your ID or passport, the landlord's ID or details, and the previous arnona bill. Then pick a payment method: credit card online, bi-monthly payment slips, or a monthly standing order from your bank (hora'at keva), which spreads the cost evenly. Ask the landlord for their ID and the latest bill a few days before you get the keys, and keep the municipality's confirmation.

Usually not. Most councils won't register a change of occupier for a contract under one year, so the landlord stays officially liable and typically builds an estimate of arnona into your rent. That can be convenient, but you can't claim an oleh discount on a bill that isn't in your name. Before signing, ask how much of the monthly rent covers arnona and have that figure written into the contract. A similar snag comes up with a dira mefuzelet (split apartment), a single unit subdivided into smaller flats, which often has no arnona account of its own. Ask whether the unit has its own account number. If the landlord can't show you one, budget for paying full arnona through them.