Financial support plan for businesses in Israel

The State approves the financial and economic support plan of Prime Minister Benjamin Netanyahu and Finance Minister Israel Katz.

This plan is drawn up for a one-year period.

It aims to support businesses and self-employed people in Israel.

Safety net for freelancers and companies in Israel :

• Immediate assistance grant for the self-employed and business owners for the months of May & June 2020:

The immediate subsidy was paid to over 300,000 self-employed workers and business owners by the tax authorities. Around a third of eligible beneficiaries received the maximum subsidy of 7,500 shekels. The total amount of subsidies paid out is 1.8 billion shekels. The government has approved the decision for immediate implementation.

Company subsidies from July

• Social assistance for the self-employed and business owners (from July 2020 to June 2021):

Self-employed people and business owners with an annual taxable income of less than 651,000 shekels will receive a monthly allowance of 70% of their taxable income. This is subject to a reduction in sales of at least 40% over the relevant period, compared with the same period the previous year.

The subsidy is capped at 7,500 shekels per month. The grant will be paid once every 2 months, provided you meet the criteria.

• Business support grant:

Companies and the self-employed whose annual sales do not exceed 100 million shekels and whose sales have decreased by at least 40% compared to the corresponding period over the previous year, will receive a subsidy every two months until June 2021, according to the following details:

- A company with annual sales of up to 300,000 NIS receives a subsidy based on a scale.

This subsidy is divided according to the company's sales in 2019:

• Up to NIS 100,000 in annual sales: subsidy of NIS 3,000 paid every 2 months.
• from 100,000 to 200,000 NIS in annual sales: subsidy of 4,000 NIS paid every 2 months.
• from 200,000 to 300,000 NIS in annual sales: subsidy of 6,000 NIS paid every 2 months.

- A company with 2019 annual sales of between 300,000 NIS - 100 million NIS will be awarded a subsidy to reimburse its fixed costs.

This subsidy can be up to 500,000 NIS. (However, it is capped at 15% of annual sales).

Ask your accountant to calculate the amount of this subsidy.

• New business grant:

New companies set up in January-February 2020 will receive a subsidy paid every two months until June 2021.

Important: no verification is required, as this grant will be awarded automatically to new companies.

So they won't have to prove a 40% drop in sales.

• For an Ossek Patour (up to NIS 100,000 in annual sales): Subsidy of 3,000 NIS paid every 2 months.
• For an Ossek Mourché (over 100,000 NIS in annual sales): Subsidy of 4,000 NIS paid every 2 months.

Municipal tax refund - Arnona.

Companies with 2019 sales of less than 100 million shekels may receive a partial refund of municipal taxes (arnona).

Requirement: Prove a drop in sales of at least 60% over the same period, compared with 2019.

• Increase in state-guaranteed loans :

The French government can act as guarantor for state-guaranteed loans of up to 24% of 2019 sales.

This is an important extension of the program, which will enable many companies to obtain credit on attractive terms.

The loan is negotiated with the selected bank. The government guarantees part of the loan. Contact us for further information.