How to register small business – osek patur in Haifa
This is a step-by-step guide with all the links to official forms and contacts for getting registered as a freelancer or a self-employed business owner here in Israel. Full version with links is available at the Times of Israel blog platform.
Initially, I intended to do an overall guide for private business registration, but taking into account that I am making baby steps in the Israeli small business world, I decided to start by describing the process that I went through to register as a small private business — VAT exempt trader (“osek patur” in Hebrew.)
What qualifies one to be a small business owner or an “osek patur” in Israel?
There are two options for small business forms– ”osek patur” or ”osek murshe”. Much has been written about these two types of small businesses both by private people and consulting (see useful links in full article in Times of Israel). In short, the difference is in the VAT dealing, size of possible earnings and accounting procedures.
Here’s a step-by-step guide on how to register as a small business owner — “osek patur”
Finding your local Israeli Tax Authority office. Check here the addresses according to your hometown and work hours
When my number appeared on the screen, I went to the assigned desk and presented the form 821 that I already filled up in Hebrew earlier at home. Here you need to give basic details about your business, including name, ID, address, description of the business and expected annual revenue. Plus, you will be required to provide copies of your Israeli ID, a check from an Israeli bank in your name. After this procedure you get certificate of an osek patur with its number.
Next, I went down to the ground floor that would be Income Tax (Mas Hachnasa in Hebrew). There I handed them two other forms I filled up earlier at home — form 5329 and 2542.
At last, I went to other building — the National Insurance Institute of Israel (Bituakh Leumi in Hebrew), which is luckily just across the street — 8 Pal-Yam Blvd. Check other branches’ addresses here. I went to the first floor, took a number for the line and waited my turn. Here I had to file another form — 6101. I gave the necessary details about myself and my business, including other employment, the number of weekly hours I will be spending on the business and my expected average monthly profit.
Having finished with the government officials, I looked up information on how to issue the invoice for the first part of my services. After checking a few options on Google search, I ended up with online service company Invoice4you, which is marketing itself as one of the oldest and best for digital invoices in Israel.