How to Register as an Osek Zair in Israel: A Step-by-Step Guide
If your side business will turn over less than 122,833 ₪ in 2026, you can register as an Osek Zair (בעל עסק זעיר), also written Osek Za’ir. This guide shows you how to register an Osek Zair online, what to do in your first year, and how to file your annual report.
Who can register as an Osek Zair?
You can generally register as an Osek Zair if all of the following apply.
- Your annual turnover (total receipts, not profit) stays under the Osek Patur ceiling: 122,833 ₪ for 2026.
- You have no employees.
- Your business is not in a profession barred from Osek Patur status. Some licensed professions, such as lawyers, accountants and doctors, cannot register as Osek Patur.
- You don’t invoice your current employer, and no more than 25% of your turnover comes from a relative or from an employer you worked for in the last three years. You are also not a controlling shareholder in a closely held company.
How to register as an Osek Zair
Osek Zair registration is done once, online, with a single application. It opens your income tax (מס הכנסה) and VAT (מע”מ) files. The Tax Authority tells Bituach Leumi automatically if you need a file there too; you then manage it in the Bituach Leumi personal area.
What you need to register an Osek Zair
Osek Zair registration: step by step
Set up your online login
If you have never used the Tax Authority’s personal area, register for it first. Keep your login details safe; you will use them for every step in this guide.
Submit the Osek Zair registration form
Complete the application to open an Osek Patur file (בקשה לפתיחת תיק עוסק פטור). During the application you confirm that you meet the Osek Zair conditions and that your expected turnover is below 122,833 ₪.
Upload your documents and send
Attach the documents from the checklist above. There is no fee.
Track the outcome
You will receive updates by SMS and email at each stage. You can check the status, or message the tax office, from the “הודעות שלי” button inside the application system.
Save your confirmation
Once your Osek Zair is registered, keep the file-opening confirmation. Clients, banks and your invoicing platform may ask for it.
You don’t need a new one. Submit a request to change your file type to Osek Zair. In most cases the answer comes back automatically. Do this before the end of the tax year you want it to apply to.
Your first year after you register as an Osek Zair
Keep three things in order: receipts, Bituach Leumi, and a tax estimate filed before 31 December. Set these up in your first month and they mostly run themselves.
Set up in your first month
Choose an invoicing platform
Issue a receipt (קבלה) every time you are paid, by cash, bank transfer, Bit or any other method. As an Osek Patur you issue receipts, not tax invoices, and you don’t charge VAT.
Platforms such as morning (Green Invoice) or Sumit do this and keep a running total of your turnover.
Check your Bituach Leumi advances
Bituach Leumi sets monthly advance payments (מקדמות) from the income you declared. Log in to your Bituach Leumi personal area, check the amount looks right, and set up a standing payment by credit card or direct debit.
Decide how you will cover your income tax
An Osek Zair is not charged income tax advances automatically. Either pay voluntary advances online during the year, or set money aside and pay it all after the year ends.
If you save it yourself, put roughly your marginal tax rate aside from every payment into a separate account.
Keep going through the year
Before the end of every tax year, file your Tiyum Mas (תיאום מס) in the Tiyum Mas system. You enter your expected turnover and the system sets the tax rate that will apply to it. This step is what entitles you to the short annual report. Skip it and you must file a full annual tax return for that year.
Tip: file it early in the year, then update it in December with your most accurate figure. If unsure, estimate slightly high rather than low.
Osek Zair annual reporting
Every year comes down to three online filings between December and March. They apply every year your file is open, even if you earned nothing.
Your annual calendar
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31DecemberDuring the tax year
Final Tiyum Mas
Update your Tiyum Mas (תיאום מס) with your best estimate of the year’s turnover in the Tiyum Mas system.
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31JanuaryFollowing year
VAT annual declaration
Declare last year’s total turnover to VAT (הצהרה שנתית של עוסק פטור) on the Tax Authority website or in your personal area.
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31MarchFollowing year
Short annual report and payment
Submit the short annual report (דיווח שנתי מקוצר) and pay any tax due.
How to file the short annual report
Total your turnover
Take the year’s total from your invoicing platform. Use the full amount received, not your profit.
Log in and enter it
The system deducts 30% for expenses automatically and calculates your tax at the rate set by your Tiyum Mas.
Add optional items
Enter any tax deducted at source by clients and any pension contributions you made as self-employed. Attach confirmations for both.
Settle the balance
If you owe tax, pay through the Tax Authority’s online payment system; advances you paid are credited first. A refund goes to the bank account the Tax Authority holds for you, so keep those details current.
What happens if you miss a deadline
The Tax Authority sometimes extends deadlines; the 2025 short report, for example, was extended to 31 August 2026. Check the current year’s date, but plan to meet the standard deadlines.
Bituach Leumi receives your final income figure from the Tax Authority and recalculates your contributions for the year. You then get a refund or a bill for the difference. Use this moment to update your monthly advances in the Bituach Leumi personal area for the year ahead.
This guide is general information, correct as of October 2026. It is not personal tax advice. Rules and thresholds change each year, so check the official sources before acting.
