Report and payment - Short annual income tax statement for small business owners (Form 137)

The service enables small business owners to submit a short annual income tax statement, if the company's income (company turnover) and other personal income (work, pension, etc.) do not exceed NIS 60,000. The amounts are updated for 2022.

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Following the implementation of the “Small Business Owner” reform, as of the 2025 tax year, reporting via Form 137 will no longer be required. It will still be possible to use Form 137 for reporting purposes up to and including the 2024 tax year. A business owner whose turnover is lower than the turnover threshold of a VAT-exempt dealer, and who meets the other conditions set out in the law, is entitled to register as a small business owner and submit a shortened report instead of an annual report.

Who can submit a short annual income tax statement

The short annual income tax statement is intended for small business owners (or their spouses) who are Israeli residents and meet the following conditions:

  • the declarants or their spouse have an income solely from these sources: business, liberal profession, income from work, allowances, retirement allowances, or income from the capital market, the full amount of which is taxed at source at a flat rate.
  • the declarants or their spouses are small business owners whose business income (turnover) together with their personal income (work, allowances, etc.) do not exceed NIS 60,000, depending on the situations specified in section 2 of the explanatory notes.
  • For a spouse who is not the owner of the small business, one of the following two conditions must be met:
    • No income
    • The tax is deducted in full from their earned income or benefits and they are not required to file an annual tax declaration.
  • Anyone whose turnover from capital market transactions, from which the full amount of tax is deducted at source, does not exceed NIS 2,719,000 may submit a short annual income tax statement in accordance with the circumstances in section 2.
  • Those whose total taxable income does not exceed the amount of NIS 663,240 - may submit a short annual income tax statement in accordance with the circumstances set out in section 2.
The form is not intended for the population groups listed in section 3 of the explanatory notes. You will find an explanation of how to complete the form on the second page of form 137 for 2022.

What to attach

  • Form 106 from all workplaces
  • Form 867 – income from the capital market
  • For those retiring - a copy of form 161
  • Receipts of payments by the National insurance Institute
  • Receipts of pension payments as a "self-employed person".
  • All sections of the online report must be completed, printed in two copies, signed and the relevant documents must be attached.
  • Those who are not required to submit an online report may submit a printed report. Download form 137 for 2022, fill in the required information, sign it and attach the relevant documents.
  • The report and attached documents must be filed at the office of the assessor chosen by the business owner. Make an appointment at the tax office you wish to visit. Without an appointment, it will not be possible to have a meeting. To schedule an appointment at the tax office

What happens next

The assessor will receive the report and process the data as indicated in the report. The appraisal notice will be sent by letter to the business owner's home address as recorded in the population register.

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Please note, if there is any difference or conflict between the information on this page and the law, the provisions of the law will apply.

Israel Tax Authority

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