I think I’ll be quoting or referring to him…
After getting a tip from a member of CIWI (Connecting Independent Writers in Israel that:
The Income Tax department (mas hachnasa) is currently offering free guidance on filling out your 2007 tax return (for salaried employees) or annual report (for atzmaiim). It just started on Sunday and will go until the end of April every afternoon between 4pm and 7pm at their office on Kanfei Nesharim.
I went yesterday at 4pm and there were only two other people waiting! The clerks warned that in a few weeks it will be bedlam. (I went later last year and I remember that there were about 50 people waiting and most were not in a good mood). Therefore my advice is to go ASAP!
The clerks were relaxed and patient, and my report was completed and submitted in 15 minutes, without me paying a penny to a tax advisor.
As always before visiting a government office, you should call ahead to make sure that you know which documents you need to bring with you.
The no. for Mas Hachnasa is 654 5111.
Behatzlacha rabba and happy Purim!
I figured I have nothing to lose, free is nice. Luckily my son’s dentist appointment was pushed up to 3:10 yesterday instead of 5, so I could put him on a bus back to Maale Adumim in time for Krav Maga, and walked from Machaneh Yehuda to the Central Bus Station/Center One.
You might remember that Mas Hachnasa has a main Jerusalem branch on Kanfei Nesharim, and in fact the CIWIer quoted above pointed me to that location. But since the Center 1 office was walking distance, and I’d been told that the Center 1 spot services Judea and Samaria residents, I figure I’d give it a shot.
Sure enough, I got there at about 5:10, and the place looked abandoned. Even the wall signs announced closing times no later than 5. But someone walking out told me that I could get service on the 6th floor, room 615, and I made a beeline for there.
There was no one in that room, but the lights and the computers were on and I had a feeling they were on a coffee break. The resident of room 614 said he might be around, and was nice enough to go find him.
Well, as Ms. Ciwi predicted, no one was on line before me, and no one after me.
To make a long story short (after you’ve suffered through all this fluff:-), I learned the following things:
- If you make less than about 50K NIS a year, and in some cases, less than 70K or more, Mas Hachnasa isn’t going to take any money from you.
- You are strongly urged to keep good records of your business, first and foremost for your own good. If you document all business related income and expenses, you are OK.
- If you project to make less than the minimum to require tax payment, you can disregard the Pinkas Mikdamot (pre-pay tax stub booklet) and request to be relieved of prepaying at the Gvia department. (I’ll blog about my doing this, of course).
- If you request to be relieved of prepaying, you might be asked to provide a report/declaration of your income and expenses / profit and loss. (if you follow rule #2 above, you are covered)
- You should keep a pinkas kabaklot (receipt book) to document your income, and a sefer tashlumim vetakbulim (payments and receivables book), and whatever other diary you keep will be good too. Again, mostly for you, and if necessary, for the taxman too.
After doing Step One, opening up a Tik Osek Patur at VAT, then pretending that I don’t have to go to Mas hachnasa because they automatically sent me some papers, then not printing a receipt book as they told me to because I didn’t find the best solution yet, I finally got around to going to Bituach Leumi.
Here in Maale Adumim, we have a few government satellite offices that are a best kept secret. For example, the Misrad Hapnim branch gives [95% of] the same services you get at the Jerusalem Helene Hamalka main branch, with 1% of the line/queue and 500% of the niceness. I have been in Bituach Leumi offices in JM and in the one here in MA, and would guess the numbers are about the same if not better. Except that the MA BL branch is only open 8-12:30 Wednesday morning.
Anyway, I had some previous business (you could say run-ins) with Bituach Leumi, but I figured that with a little expectations clarification (tiyum tzipiyot – one of my favorite things), we could get onto the same page, with me getting what I want and them getting what they want.
So what did I want?
- To clarify my status as a low-income “oved atzma’i,” a “lo-sachir” ( or perhaps “atzma’i ve-eino-sachir”).
- To clarify the points at which the premium rates change.
- To figure out how I can assign myself to the lowest possible bracket.
What did they want?
- For me to fill out Form 6101 (Din Vecheshbon Rav Shnati = Multi-Annual Report), based on my self-definition as an “oved atzma’i,” fulfilling one of the following three conditions:
a. Works at least 20 hours a week on average.
b. Monthly average income is at least 50% of the national average income.
c. Works at least 12 hours a weekand have an average monthly income of at least 15% of the national average income.
We spent about an hour each asking for the above from the other, and not getting it:-(
What I did get was a print out of my statement from Feb 1 2000 through Mar 19 2008.
On my way out, I called a friend of mine who has worked in bookkeeping/accounting for the past decade or so, to see if he could help me get the info that I was after, seeing that it didn’t seem to be a national security secret issue. He chided me for not dealing with an experienced accountant (as the BL clerk encouraged/urged/required me to). I was frustrated as: A. No-one would give me a list of such accountants and B. Why should I pay an accountant $100 for an hour’s consultation when I’m going to end up an osek patur??
Anyway, I am going to stop now, and hopefully complete this story before Wednesday, when I’ll go back to Bituch Leumi (I didn’t say which Wednesday…)
As is the case with many bureaucratic hurdles in Israel, doing this is less scary than you may have been led to think.
Why Osek Patur?
If you are just starting out your business, do not expect significant expenses, and do not expect more than around 5,000 NIS a month income (actually, 60,000 a year), then you may prefer to open as an Osek Patur. The benefit is simply that you are not required to pay VAT monthly. Ultimately, you will hopefully graduate to Osek Murshe status (as a friend of mine once said, he loves paying a lot of tax; that means he’s making a lot of money!) but meanwhile, one less office to interface is worth it imho.
What To Expect
About an hour’s wait in the office
No wifi in the waiting room
Fill out a form (I’ll try to get a copy of it and scan and post it here)
Non-standard form fields
<snip> I will post this and revisit it when I get a copy of the form. Unfortunately, I neither photocopied the form I submitted nor got a copy or processed report of it (as I probably expected, silly me!), so it’s a little hard for me to recreate it from memory.