Global Daily Tax News, Israel To Offer Simplified Small Business Tax Scheme, (Nov 22, 2024)

Israel is to introduce tax administrative reliefs for taxpayers exempt from the requirement to charge value-added tax.

Earlier this month, the Finance Committee of the Knesset agreed that businesses with a turnover of not greater than ILS120,000 (USD32,340) would be able to optionally register as a "small business" under the Income Tax Ordinance. These businesses will be allowed to deduct expenses against their income taxable amount at a rate of 30 percent, without having to claim expenses, and will generally be exempt from the requirement to submit an annual report, submit a declaration of capital, or make advance payments of income tax.

Small business owners are currently required to submit at the beginning of the following year an annual report detailing business income and sought-after deductions. In addition, they are required to report and pay advances once every two months during the tax year.

The tax agency is to launch a dedicated webpage this month for taxpayers wishing to benefit from the simplified tax regime, which will include detailed explanations.