Osek Patur עוסק פטור
The Osek Patur is an individual entrepreneur opening a business without forming a corporate entity (company or partnership). He is therefore exempt from VAT. If you intend to be a self-employed worker in Israel, check here what you must do to be properly registered as such.
Limit of Annual Income
If your annual income threshhold is around ₪120,000 per year. The exact limit is reset annually.
Field of Business
Your business does not operate in certain fields (Professions, such as architect, engineer, private detective, lawyer, accountant, doctor, management advisor, insurance agent, psychologist, dentist, medical clinic, university professor & lecturer, translator & interpreter, artistic performer, exam administrator (preparing, supervising, reviewing/marking), author, instructor of a driving school, real estate agent, teacher at a school or Gan, car dealer).
A Non-Incorporated Company
Your business cannot be registered as a corporation
1. Form 821: VAT
Fill out form 821 to open a VAT case.
2. Form 5329: Income Tax
Fill out form 5329 to open an income tax file.
3. Submission
Go to this website and submit the above mentioned forms. Attach a copy of the identity card of both spouses, a professional qualification certificate if any, and a bank account management certificate.
4. Bituach Leumi
Once you are registered as Osek Patur, you must register with Bituach Leumi by filling out the following online form.
Unqualified Field of Business
If your field of business does not qualify for an Osek Patur (see list in B), you must register as an Osek Murshe (not VAT-exempt).
Professional Assistance
You might prefer to do the entire process through a qualified tax consultant or accountant. He can also help you with the annual reports.
This guide was written under the guidance of Irit Scharf, accountant and tax advisor.