With its emphasis on higher education, RnD and openness to immigration, Israel is a true modern tech and startup hub.
The government assists industrial growth by providing low-rate loans from its development budget.
Moving business to Israel means not only being open to Israeli infrastructure and financing.
Many venture capital firms from the US and other countries have set up offices in Israel to be closer to the startup scene.
Yet, the cost of living in Israel is not as high as in the US startup hubs such as San Francisco or New York City. And, there are added bonuses such as the sea - even 2 seas or 4 if you count enormous lakes, plus excellent food and a vibrant community.
Israel is welcoming to expats and non-residents for business. For example, there are special startup visas for those who want to start their business in Israel.
Grants
The Israeli government supports local and foreign investments, and offers grants and loans to encourage businesses. Examples of such benefits are grant programs for startups and tax holidays. A company that gets a government grant as a startup can also apply for a tax holiday or tax breaks.
Paying Taxes in Israel
All businesses in Israel have to file tax and financial statements as well as audited tax returns no later than 5 months after the end of fiscal year. Usually, the fiscal year is the same as the calendar one. Companies must also file monthly returns accompanied by tax payments or bi-monthly returns for smaller businesses.
The corporate tax rate in Israel is 23% in 2022, the same as in 2021. Tax breaks and reductions are available to some business operations under the Encouragement of Capital Investments Law and depend on conditions such as location.
Israeli residents pay taxes from their income anywhere in the world. Whereas non-residents are taxed only on their Israeli income. Income includes employment, business revenue income, and passive income from bank deposits and savings.
Regulations
While rules for running a business in Israel are transparent, they aren’t always easy to navigate either for a newcomer or for a person too busy with other duties. Yet, there is also strict business discipline.
For instance, regulations require invoice specifics and detailed bookkeeping for income tax and VAT. Tax officials in Israel inspect accounting records.
Such and other regulations are obligatory. Misinterpretation or untimely application of rules may lead to fines or customer complaints which are bad for both the budget and reputation.
Auditing and Bookkeeping
However, an experienced accountant and auditor can help new business owners avoid any violations. Not only that, but these experts can help you apply for applicable startup grants and save considerable time and money by managing your accounts.
We at Step Up Finance believe that a solid foundation for any business comes from total transparency in its books.
Happy to support startups from idea to exit, we provide professional and orderly bookkeeping and compliant monthly reporting. We can organize a well-working accounting system, budgeting, cash management, forecasting and more. So you can fully outsource such important roles as CFO and Finance controller.
With our payroll service we manage all allowances and payments, including calculation of vacation pay, sick leave and other disbursements. We offer payroll capabilities in a number of territories, enabling quick and flexible international expansion.
Israel supports young business ambitions and so do we. Come to Israel, come to Step Up Finance and get help in all aspects of startup financial management. Thanks to our excellent team and a wide professional network, we can help your investments flourish bringing you new business and revenue streams.
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