Accounting Rules

Tax Year: The financial year starts from 1 January and ends on 31 December of the same year.
Accounting Standards: Accounting in Israel started with the help of the "The American Institute of Certified Public Accountants "(AICPA). The accounting practices in these countries are similar to American practices. IFRS are extensively used.
Accounting Regulation Bodies: IASB
Accounting Reports: The financial accounts include a balance sheet, an income statement, a cash flow account and an owner's equity account.
Publication Requirements: Accounts have to be published annually.
Professional Accountancy Bodies: ICPA , Institute of Certified Public accountants in Israel
IFAC , International Federation of Accountants.
Certification and Auditing: Audit is carried out by external auditors in the company. KPMG, Pricewaterhouse Coopers, Deloitte. Ernst and Young : http://www.ey.com/Home
Accounting News: EIN Middle East accounting news.

Tax Rates

Consumption Taxes

Nature of the Tax: VAT - (MA'AM in Hebrew)
Tax Rate: 17%
Reduced Tax Rate: Export of products and certain services is not subjected to VAT.
Other Consumption Taxes: Tax on Capital gains from real-estate is applicable on the sale of the real estate.
Purchase tax is deducted on some imports or local industrial production. For additional information, consult the Finance Ministry.

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Corporate Taxes

Company Tax: 25%
Tax Rate For Foreign Companies: The resident companies are taxed on their total income, while the non-resident companies are taxed on incomes from activities in Israel.
Capital Gains Taxation: 32% for shareholders holding 10% or more of any means of control of the company. In other cases: 27%.
Main Allowable Deductions and Tax Credits: Deductions are granted when the company invests in scientific research in the fields of industry, agriculture, transport or energy. A deduction is possible at the time of investments in oil companies. For additional information, consult the Deloitte Tax Guide.
Other Corporate Taxes: Access the 2012 Deloitte Tax Guide on Israel.

Country Comparison For Corporate Taxation

	Israel	Middle East & North Africa	United States	Germany
Number of Payments of Taxes per Year	33.0	19.0	11.0	9.0
Time Taken For Administrative Formalities (Hours)	235.0	184.0	175.0	207.0
Total Share of Taxes (% of Profit)	32.3	32.3	46.7	46.8

Source: Doing Business - Last Available Data.

Individual Taxes

Tax Rate

The rate is spread over 6 sections	Progressive rates from 10% to a maximum of 50%
From ILS 1 to 62,400	10%
From ILS 62,401 to 106,560	14%
From ILS 106,561 to 168,000	21%
From ILS 168,001 to 240,000	31%
From ILS 240,001 to 501,960	34%
From ILS 501,961 to 800,000	48%
Over NIS 800,000	50%

Allowable Deductions and Tax Credits: Tax deductions are granted to residents of priority areas and far from the center of the country.
Special Expatriate Tax Regime: Certain expatriates are subjected to a special system with a maximum rate of 25%, other follow the normal system. Foreign residents are exempted from taxes on capital gains resulting from share investments in the Tel-Aviv Stock Exchange.

Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed: Israel has signed financial agreements with several countries in the world.
Withholding Taxes: Withholding tax rates are: 20/25% for dividends, 15/20/24% for interest and 24/25% for royalties.

Sources of Fiscal Information

Tax Authorities: Fiscal Authority
Other Domestic Resources: WorldWide Tax on Israel

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Intellectual Property

National Organizations: Israeli Patents Office of the Ministry of Justice for patents and copyrights.
Regional Organizations: Israel is signatory of European Convention on the International Classification of Patents for Invention and European Convention on patent formalities, as well as Universal Copyrights convention and the Lisbon convention. In any case, it is better that foreign patents are registered in Israel.
International Membership: Member of the WIPO (World Intellectual Property Organization)
Signatory to the Paris Convention For the Protection of Intellectual Property
Membership to the TRIPS agreement - Trade-Related Aspects of Intellectual Property Rights (TRIPS)

National Regulation and International Agreements

Type of property and law	Validity	International Agreements Signed
Patent Law on patents (1978)	Validity period; 20 years
Trademark Law on registered trademarks (1998)	Validity period; 10 years	Trademark Law Treaty Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks
Design Law on industrial designs (1992)	Initial validity period; 5 years
Copyright Law of 1911 and Order on the copyrights	For the lifespan of the author and 50 additional years for musical artistic works and 70 additional years for literary works.	WIPO Copyright Treaty WIPO Performances and Phonograms Treaty

Legal Framework

Independence of Justice: The judicial power is largely independent in Israel and the guarantees of procedure are generally respected.
Equal Treatment of Nationals and Foreigners: Foreign nationals can be expected to benefit from a equitable legal process.
The Language of Justice: The legal language of the country is Hebrew but Arabic is also used officially by the Arab minorities of the country .
Recourse to an Interpreter: Yes
Sources of the Law and Legal Similarities: Israel does not have written constitution. Certain functions of the constitution are fulfilled by Declaration of Establishment (1948), the Basic laws of the parliament and the Israeli citizenship law. The legal system is a blend of Common English Law and British Mandate Regulations. Israel no longer accepts the compulsory jurisdiction of ICJ.
Checking National Laws Online: Lexadin, the world law guide

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Standards

National Standards Organizations: The Standards Institution of Israel (SII)
Integration in the International Standards Network: International Organisation for Standardization (ISO)
International Electrotechnical Commission (IEC)
International Telecommunication Union (ITU)
International Organisation of Legal Metrology (OIML)
Online Consultation of Standards: The Standards Institution of Israel (SII)
ISO Catalogue
Certification Organizations: The Standards Institution of Israel

Business Practices

General Information: Doing Business with Israel
Guide to Israel
Opening Hours and Days: The weekend in Israel is on Friday and Saturday. Offices close at 1700 hrs in the evening.

Public Holidays

Purim (carnival)	March/April
Pesah (Easter)	April
Independence Day of Israel	May
Shavouth	May/June
Rosh Hashana (New Year)	September/October
Yom Kipour (Day of Atonement)	October
Souccoth (Festival of Huts)	October
Simhat Torah, start of the reading of the Torah	October
Hanukkah (Festival of Lights)	End November/December

Periods When Companies Usually Close

Days of Jewish Festivals
Period of Pessah (Easter)	April
Period of Souccoth (Festival of Huts)	October

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Israel: Business Environment

Accounting Rules

Tax Rates

Consumption Taxes

Corporate Taxes

Country Comparison For Corporate Taxation

Individual Taxes

Tax Rate

Double Taxation Treaties

Sources of Fiscal Information

Intellectual Property

National Regulation and International Agreements

Legal Framework

Standards

Business Practices

Public Holidays

Periods When Companies Usually Close