Open a Licensed Dealer file with CPA.DIGITAL
The most common status for self-employed in Israel with no income limit. Charge VAT to clients, claim refunds on business expenses, and build a professional image.
Wait — is Licensed Dealer right for me?
A Licensed Dealer is a business status for self-employed in Israel who are not limited in income and are required to operate under a full reporting system with the tax authorities.
This means keeping books, ongoing reporting and paying taxes based on actual income.
Choosing Licensed Dealer suits those planning significant business activity, working with business clients or wanting to build a foundation for growth.
In many cases this is a step that comes after starting as an Exempt Dealer, but not always.
How does the online Licensed Dealer registration work?
Opening a Licensed Dealer is not done with a single authority — it involves registration with several authorities in parallel. Each handles a different aspect of the business activity, so it is important to do it in an orderly way.
When you register online, you can centralize all actions in one process, avoid physical visits to offices or missing forms, and make sure all documents are submitted correctly without errors that may delay opening the business.
What does the process involve?
- Opening a VAT file. At this stage the business is registered as a Licensed Dealer and receives a dealer number. From this moment there is an obligation to charge VAT to clients and submit periodic reports (monthly or bi-monthly).
- Opening an Income Tax file. Here the business details are set for taxation. A declaration of activity start is filed, and later tax advances are set based on income forecast.
- National Insurance registration. Setting the status as self-employed for National Insurance and health insurance payments. The amount changes with income and affects social rights.
Ready to Get Started?
Register as a Licensed Dealer and start your business with no income limitations.
Pros and cons of Licensed Dealer
Before deciding, it is important to understand the full picture — both the advantages and the disadvantages of this status.
יתרונות
- No income limit — allows unrestricted growth
- Ability to reclaim VAT on business expenses
- A more professional image with clients
- A relatively simple registration process
- Lower costs compared to an Ltd company
חסרונות
- Personal liability for business debts
- Obligation to charge and report VAT (18%)
- Ongoing reporting to authorities
- Relative difficulty in adding partners or investors
- In some cases — a higher tax burden
Licensed Dealer or Exempt Dealer — what is the difference?
The main difference between Licensed Dealer and Exempt Dealer is the obligation to charge VAT. An Exempt Dealer does not charge VAT and cannot reclaim it, but is limited to an annual income of 122,833 NIS as of 2026.
A Licensed Dealer, by contrast, has no limit but enters a full reporting system. The choice depends on activity volume, client type and business growth plans.
How much does it cost to maintain a Licensed Dealer over time?
Beyond the cost of opening the business, you should account for ongoing costs. These include bookkeeping, reporting to authorities, and often professional accountant support — a service which CPA Digital also offers.
In addition, you should account for tax payments — Income Tax, VAT and National Insurance. Proper conduct from the start can significantly impact the long-term financial running of the business.
For whom is opening a Licensed Dealer the right choice?
Opening a Licensed Dealer suits a wide range of professionals and entrepreneurs, especially when significant income is expected or when working with business clients.
- Freelancers with an active client base
- Consultants and professional service providers
- Owners of small businesses planning to grow
- Businesses operating with companies and other businesses
- Service providers in B2B
- Contractors and subcontractors
Open a Licensed Dealer online with CPA Digital
At CPA Digital we centralized the entire process of opening a business into one simple system, allowing you to start operating quickly without getting tangled in bureaucracy.
Our team accompanies you throughout the process, making sure registration is performed correctly with all the authorities, and saving you precious time and the need to deal with multiple parties at once. All of this is done online, in a clear and transparent way.