Israel – Company Incorporation Guide

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Israel – Company Incorporation Guide

Foreign-owner friendly structures with clear steps. Use this checklist for entity choice, filings, taxes, VAT, and compliance dates.

Snapshot

  • Common entity: Private company limited by shares (“Ltd”).
  • Foreign owners: 100% foreign ownership allowed.
  • Administration: Minimum one director; no resident‑director requirement for private companies.
  • Registered office: Israeli address required and filed with the Registrar.
  • Timing & fees (2025): Incorporation often 1–3 business days after complete papers. Online fee NIS 2,497; annual fee NIS 1,306 by Mar 31 (NIS 1,734 from Apr 1).

How to set up

  1. Prepare the formation pack: Articles of Association; initial directors’ consents and IDs; registered office details; shareholder KYC (passports; for corporate owners—incorporation/Good Standing, incumbency, UBO declaration; notarization/apostille as requested).
  2. File incorporation via the Corporations Authority portal (often through a lawyer/CPA), pay the fee, and receive the Certificate of Incorporation and company number.
  3. Register with the Tax Authority (CIT and employer files), National Insurance (if hiring), and for VAT as an osek murshe (companies cannot be osek patur).
  4. Open a business bank account; expect robust AML/KYC (CRS/FATCA, UBO checks, source‑of‑funds, possible in‑person sign‑off and Israeli TIN for signatories).

Company taxes

  • Corporate income tax: 23% (2025).
  • VAT: 18% standard rate from Jan 1, 2025; exports and certain cross‑border services are zero‑rated. For B2B tax invoices ≥ NIS 20,000, an invoice‑allocation number is required.
  • Withholding & incentives: Dividends generally 25% (30% for ≥10% holders); interest/royalties commonly 23% (treaties may reduce). Incentives are available for qualifying Preferred (Technological) Enterprises.

Accounting & filings

  • Audit & reporting: All companies appoint an external auditor and file annual audited financial statements (IFRS or Israeli GAAP).
  • Annual Registrar compliance: File the annual report and pay the annual fee (NIS 1,306 by Mar 31; NIS 1,734 from Apr 1 in 2025). Maintain proper books in Israel and file corporate/VAT/payroll returns per assigned cycles.

Banking, KYC, and tips

  • Expect strong AML/KYC, UBO verification, and explanations of source/use of funds; foreign owners without Israeli ID will be assigned the necessary identifiers.
  • Plan ERP/invoicing to support the VAT rate and invoice‑allocation control; align numbering for invoices ≥ NIS 20,000.

Ready to start? Email [email protected] or [email protected].