Managing Property Abroad Remotely: Management Agreement, Power of Attorney, Bank Account, Taxes and Israeli Reporting

1How do you manage property abroad remotely while living in Israel?

You manage it through a system of documents, not through one person you trust. An owner living in Israel needs five tools: a management agreement, a limited power of attorney, a bank account in the property's country, an orderly arrangement of local taxes and insurance, and reporting to the Israel Tax Authority.

This guide is the general toolkit, and it fits any country. We have written separate guides on management agreements under the law and practice of specific countries, including the guide on a property management agreement in Romania and the guide on a US property management contract.

2What must an overseas property management agreement include?

A management agreement should define four things: which tasks the manager performs, how much they may spend without asking, how and when they report, and how you part ways. All other clauses derive from these.

• Scope of tasks: marketing and tenant selection, rent collection, maintenance, paying bills and local taxes, and monitoring insurance. What is not written in the agreement is not included in it.
• Spending cap: an amount per single expense above which prior written approval is required, with a defined exception for emergencies.
• Owner's funds: where the rent is paid, on what date it is transferred to you, and an undertaking not to mix it with the company's funds.
• Reporting: a monthly report with income, expenses and invoices, and an annual summary report in a format your accountant in Israel can work with.
• Leases: whether the manager signs on your behalf, on what minimum terms, and who holds the tenant's deposit.
• Local taxes: who is responsible for filing rental-income returns in the property's country, and who bears the penalty if they are filed late.
• Exit: a notice period, no termination fee, and full handover of keys, leases, deposits and documents.

3Should you give the management company a power of attorney?

Usually yes, but a limited one. The management agreement governs the relationship between you and the manager, while the power of attorney is the document the manager shows third parties - a tenant, the electricity company, an owners' association or a local authority - in order to act on your behalf.

The practical rule is simple: a power of attorney to manage is not a power of attorney to sell. A property manager's power of attorney should list the permitted acts, such as signing leases on agreed terms and dealing with bills and authorities, set an expiry date, and exclude sale, mortgaging, withdrawals from your account and appointing another attorney. An overly broad power of attorney is one of the significant risks of remote ownership.

The form depends on the property's country. In Romania, a power of attorney for an act that requires a notarial deed is signed in the same form, and from Israel only before the Romanian consul. We explain this in the guide on a power of attorney for real estate in Romania. In many other countries, a power of attorney signed before an Israeli notary and certified with an apostille is accepted. Israel, Romania, Greece, Cyprus, Bulgaria, the US, Italy, Portugal and Ukraine are all parties to the Hague Apostille Convention, but any local authority or bank may require a particular wording, translation or form. The wording is therefore agreed in advance with whoever will receive it.

When you replace a manager, revoke the power of attorney in writing, notify everyone who received it, and in countries that keep a register of powers of attorney, record the revocation there.

4Do you need a bank account in the property's country?

Usually yes, for practical reasons: local tenants pay by local transfer, and taxes, bills and building service charges are collected in local currency. The account should be in your name, not the manager's.

There are two common models. In the first, the tenant pays directly into your account and the manager invoices the management fee. In the second, the rent goes into a separate account of the manager used only for client money, and is transferred to you on a fixed date less documented expenses. The first model gives you more control. The second is more convenient and requires transparency and segregation clauses in the agreement. If the manager is given access to your account, it should be limited to viewing or to defined payments.

A bank account in the property's country is usually reported to the Israel Tax Authority under international information exchange (CRS). What passes through the account should match what you report in Israel.

5What taxes and reporting obligations apply in the property's country?

Each country taxes rent under its own law and collects the tax in its own way, so the first question the agreement must answer is who is responsible for each filing. Three examples show how different the mechanisms are:

The figures are as of November 2026. Beyond tax on rent there is usually also local property tax, service charges for the building or owners' association, and for tourist rentals a separate licensing regime. Ask the manager for a copy of every filing and proof of every payment. On combining US tax and Israeli tax, see the guide on rental income in the US and the tax treaty.

6What insurance does a rented property abroad need?

A rented property needs at least buildings insurance and the owner's third-party liability insurance, and the insurer must know the property is let. A policy taken out for a home the owner lives in may not cover damage during a tenancy.

• Local compulsory insurance: some countries have compulsory insurance. In Romania, under Law 260/2008, a dwelling registered as residential must have a PAD policy, which covers earthquake, flood and landslide and does not replace full buildings insurance.
• Risks outside the basic policy: flood, storm or earthquake are sometimes excluded from a standard policy. Check the exclusions for the area.
• Contents and loss of rent: for a furnished flat it is worth insuring the contents, and some insurers offer cover for loss of rent after damage.
• Who monitors: the agreement should provide that the manager ensures timely renewal and sends you the policy, and that the tenant's insurance, if required, is shown before the keys are handed over.

7What should you know about tenants' rights in the property's country?

Tenancy law is local law, and it usually cannot be contracted out of. A lease drafted in Israel or from an internet template will not override the tenant protections of the country where the property is located.

Some principles recur almost everywhere: evicting a tenant who does not pay is done through legal proceedings, not by changing the lock; deposits have rules on holding and return; and there are sometimes limits on rent increases and on ending the lease. In the US the rules are set at state level and vary widely, so it is worth reading the comparison of landlord-tenant and eviction laws by US state. Tourist rental is usually a separate regime, with licensing, registration and sometimes restrictions in the building's rules.

8What do you report in Israel on rent from property abroad?

An Israeli resident is liable to tax in Israel on rent from property abroad as well, and has two routes. Under section 122A of the Income Tax Ordinance, an individual may pay 15% on rent from letting real estate outside Israel, provided it is not business income. Anyone who chooses this route deducts no expenses other than depreciation, and is not entitled to a credit for tax paid abroad. The alternative route is tax at the marginal rates on net income, with deduction of expenses and a credit for the foreign tax.

Remote management has a practical consequence here: the management fee is an expense. On the 15% route it does not reduce the tax base, so when the manager transfers a "net" amount to you, the full rent before the management fee and expenses must be reconstructed. On the marginal-rate route it is deductible, but only with invoices.

Beyond the tax, property abroad often creates an obligation to file an annual return, even without a profit. We have gathered the thresholds, deadlines and the link to fund transfers in the guide on the Israeli side of property abroad.

9How do you build an annual monitoring routine from Israel?

A fixed routine replaces the need to be there. Five steps a year are enough for most properties:

1. Every month: check that the rent arrived on time and that the monthly report matches the bank statements.
2. Every quarter: review expenses above the approval cap and make sure each one has an invoice.
3. Before the reporting deadline in the property's country: confirm who files, and obtain a copy of the filing and proof of payment.
4. Once a year: obtain a condition report with photos, check the insurance renewal and pull an up-to-date land registry extract for the property, to make sure nothing has been registered against it without your knowledge.
5. At the end of the tax year: send your accountant in Israel an annual report from the manager, with the gross rent, every expense, the local tax paid and the receipts.

10What to do before signing, and how we accompany this

The right moment to build the toolkit is before signing the management agreement, and often even before the purchase: obtain the agreement in writing and compare it with the list above, draft a limited power of attorney in a form the property's country accepts, decide on the account model, and set in advance who files each return. We go through the management agreement, the power of attorney and the leases with Israeli property owners, and coordinate with the accountant in Israel and with lawyers and notaries licensed in the property's country, who carry out the acts under local law.

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