Investment in  foreign countries can be very profitable but can also bear high risks which in turn can cause  heavy losses.

In order to minimize the risks, companies, entrepreneurs and investors need to be familiar with the foreign economic environment such as tax authorities,  local regulations, governmental structures, human capital, labor market, antitrust laws, financial reporting, governmental incentives policies and more.

In this article we will elaborate and go through the process and the requirements of registering a company in Israel.

Step #1 – Registrar of Companies

All companies in Israel are required to be registered with the Registrar of Companies.

In order for a foreign company to legally maintain a place of business in Israel it needs to register

(An Israeli branch office and a subsidiary company are both registered legal entities).

Herewith the required documents:

1. List of the company’s directors, including their passport numbers.
2. Power of attorney form bestowing upon an Israeli representative the responsibility for officially representing the company in Israel.
3. The full name, address and national identification of an Israeli representative appointed to receive legal notices .
4. The company’s Articles of Association and its Hebrew translation certified by a notary.
5. The company’s certificate of incorporation from its country of origin signed by an apostille. In cases where the country of origin does not issue such certificates, the lawyer handling the registration should deliver a signed letter declaring that such certificates are not issued in the country of origin, in addition to an official documentation indicating that the company is registered with the Registrar of Companies in the country of origin.
6. Hebrew translation of the company’s certificate of incorporation certified by a notary.
7. Status approval from the state of origin – document proving the company is active in its country of origin and the document’s Hebrew translation.
8. Proof of payment of the registration fee (currently 2,606 NIS (Approx. 711.5 USD).

Step #2 – VAT Tax authority department

Once the company has been registered, the next step is registration in the local Israeli VAT Tax authority department  nearest to the expected company’s office location.

Further to this, the company’s representative will have to submit the below forms:

1. VAT form 22 – Application for Registration as a Foreign Dealer.
2. VAT form 821 Registration for VAT purposes.

The following materials are required in order to register:

1. Registrar of Companies certificate of registration.
2. The company’s Articles of Association and directors’ appointment protocols as approved by the Registrar of companies.
3. A contract regarding renting or buying offices for the company.
4. Document proving the possession of an Israeli bank account.
5. Company directors’ details – ID numbers, addresses, phone numbers.
6. Company assets information: total investment, funding resources, estimated business cycle.

Step #3 – Income Tax

The registering company must to submit Income Tax form number 4436 which includes basic details about the company.

Step #4 – National Insurance Institute
A copy of the form submitted to one of the relevant tax offices is transferred to the National Insurance Institute and the same filing number is used for both authorities.

Our firm’s consultants are accompany  companies in their first steps, we consult, guide and cover all  matters which  are related to the establishment of the company.