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The tax authority reduces enforcement on small businesses. Is it possible to celebrate? - Walla! Of money


The income tax decided to direct the resources to businesses that have a turnover of NIS 10 million and more per year. Does this mean that small and medium-sized businesses can get a foot off the gas?

The tax authority reduces enforcement on small businesses.

Is it possible to celebrate?

The income tax decided to direct the resources to businesses that have a turnover of NIS 10 million and more per year.

Does this mean that small and medium-sized businesses can take a foot off the gas and include in the annual report also the receipts from the restaurants, which the CPA sought to shelve? Not so fast

David Rosenthal


Thursday, 19 May 2022, 10:50

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The holidays are over, the corona is moving away and the season for filing annual income tax returns is at its peak.

It is a good time to mention that only about 30,000 of the approximately 1.5 million annual income tax reports submitted to the tax authority each year are indeed examined - only about 2%.

This is according to data recently published and approved by the Tax Authority.

It was also learned that the tax authority decided to change strategy and pull the short blanket in the direction of the big businesses anyway, and focus on examining their reports.


Money learned that the intention of the tax authority is to target the limited capacity mainly in companies whose turnover is higher than NIS 10 million per year.

All this, in contrast to what was customary until today.

As can be learned from the periodic Tax Authority announcements, she also invested considerable effort in enforcing small businesses: Searching and finding irregularities in the reports and conduct of restaurants, private shop owners and service providers has become a common and accepted phenomenon.

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Even if you have a small business - be careful (Photo: ShutterStock)

"Perhaps the tax authority has internalized the criticisms leveled at it from time to time, according to which it is actually caught as a small fish, because it is afraid of confronting the sharks that continue to swim in the big sea unhindered," explains attorney Uri Goldman, a tax and money laundering expert. Also a second side: this is how the authority finds itself dealing with cases that require a lot of energy but do not end up with significant collection, or at all. "

Small and medium business owners will of course welcome the new tax authority's emerging policy For themselves to pay less attention to the reports they submit, and to proceed on their own without fear that the inspectors of the tax authority will reach them? Not so fast.

According to Goldman, "there is no chance that the tax authority will leave the small business owners completely, even for the sake of being seen. It is worth remembering that entanglements with the tax authority are not a trivial matter. If the authority thinks it has a good case, it is careful. "In any case, the authority has no problem conducting proceedings, because it can. I see this every day in relation to the medium and large companies that my colleagues and I represent in the morning news, but of course this is true in relation to every business owner, from a repairman who raised a few shekels to an established company.

For the sake of seeing and being seen.

Adv. Uri Goldman (Photo: Amit Shaal)

And what should a business or company owner, small, medium or large - do if the tax authority has decided to put its long and formidable arms on it?

It is important to understand that there are several types of audits carried out by the tax authority in a business, and each of them requires professional dealing and expertise that can be worth a great deal of money.

Advocate Goldman is convinced that in such a case, "the first phone call to be picked up is to a lawyer who specializes in the end of taxation and who has already dealt with significant cases in the past with the tax authority.

The first thing the lawyer will do is assess the situation and classify the audit.

Is this a tax official?

VAT factor? Joint investigation (IDF), preliminary procedure for a criminal investigation, requirement of an authority to prohibit money laundering or one of the regulators, etc. - Of course it is also important to understand what type of audit is conducted - in-depth audit?

Bookkeeping review and intention to reject them?

Sample, criminal investigation, etc.

"Because the authority of the authority is broad and so are the types of tests it is authorized to perform, it is very important to equip a lawyer from the first second of the audit and not wait for its conclusions and of course an attorney who understands both civil and criminal taxation is preferable, as he knows how to interface between the two worlds." Advocate Goldman notes that many times the authority that comes to audit knows what it is looking for while the auditee is surprised, so the authority sometimes achieves benefits for this surprise, benefits that are very difficult to correct later on and if an attorney was involved in the first place the forces were more equal.

  • Of money


  • Income Tax

  • small businesses

  • Self-employed

Source: walla

All business articles on 2022-05-19

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