OrdinanceTax Law
Income Tax Ordinance [New Version]
פקודת מס הכנסה [נוסח חדש]
Published: 1961-04-25Last amended 2026-06-08✓ Amendment status checked against the Knesset legislation record on 2026-09-04
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Unofficial English translation — for reference only. It may contain errors or omissions and cannot be relied on as a legal text. Only the Hebrew text published in Reshumot is legally binding.More
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Despite these checks, it may contain errors, omissions, or imprecise renderings of legal terminology and cross-references, and it may not yet reflect the latest amendments. It cannot be relied upon as a legal text.
The Hebrew text as published in Reshumot (ספר החוקים) and on the Knesset website is the sole authoritative and legally binding version. In any discrepancy, the Hebrew text prevails.
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Chapter III: Miscellaneous
Assessing Officer May Require Supplementary or Additional Returns§
142.
The assessing officer may at any time and as often as the assessing officer sees fit deliver to a person a written notice requiring the person to supply within a reasonable time specified in that notice more complete or additional returns on any matter in respect of which the person is required or obligated under this Ordinance to submit a return.
Preparation of Return by Another Person§
143.
A person who assists another, in exchange for payment, in preparing a return, notice, form or other document for the purposes of this Ordinance, is required to declare on that document that the person assisted in its preparation.
Return to Be Deemed as Having Been Duly Authorised§
144.
(a)A return, statement or form purporting to be given pursuant to this Ordinance by or on behalf of a named person shall be treated for all purposes as if given by that person or with that person's authorisation, unless the contrary is proved, and every person who signs any such return, statement or form shall be treated as one who knows every matter contained therein.
(b)Where the registered spouse alone has signed the return, statement or form, the registered spouse shall be treated as having declared that the registered spouse holds a power of attorney from the other spouse to sign on the other spouse's behalf.
Service of Copy of Claim on the Assessing Officer§
144a.
A taxpayer who files with a court a claim that is based on the amount of the taxpayer's income from any source shall serve a copy thereof on the assessing officer with whom the taxpayer's file is maintained, and if the taxpayer has no file – the taxpayer shall serve the copy on the Director.
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Contact Us →Part 9: Income Assessment, Tax Ruling, Objection and Appeal
Chapter I: The Assessment
Power to Assess§
145.
(a)
(1)Where a person has submitted a return pursuant to section 131, the return shall be treated as a determination of that person's income (hereinafter – self-assessment) and the assessing officer shall send the person a notice of the amount of tax the person is liable to pay in accordance with the return; such a notice shall have the same effect as a notice of assessment under section 149;
(2)The assessing officer may, within four years from the end of the tax year in which the return was submitted to the assessing officer, examine the return and do one of the following:
(a)confirm the self-assessment;
(b)determine, to the best of the assessing officer's judgment, the amount of a person's income, the deductions, set-offs and exemptions permitted therefrom under any law and the tax the person is liable to pay, if the assessing officer has reasonable grounds to assume that the return is incorrect; an assessment under this sub-paragraph may be made in accordance with an agreement concluded with the taxpayer;
(2a)The assessing officer may, on the assessing officer's own initiative or at the taxpayer's request, within one year from the end of the period referred to in paragraph (2), correct any error that occurred in the calculation of the deductions, credits or exemptions in an assessment under paragraph (2)(b), if the assessing officer is satisfied that the error is an arithmetical error;
(3)Notwithstanding the provisions of paragraph (1), the assessing officer may, within six months from the date of receipt of a return that constitutes a self-assessment, do as set out below, and the return shall continue to be treated as a self-assessment even after the assessing officer has done as aforesaid:
(a)correct an arithmetical error that occurred in the return;
(b)apply the provisions of any law applicable to the taxpayer by reason of the taxpayer's obligation to maintain account books for a particular tax year or part thereof and the taxpayer having failed to maintain them, or having maintained them only for part of the period during which the taxpayer was required to maintain them, or not having based the taxpayer's return on account books;
(c)apply the provisions of any law applicable to the taxpayer after it has been determined by a final determination that the taxpayer's books are inadmissible; for this purpose, "final determination" – a determination against which no further right of appeal exists.
(b)Where a person has not submitted a return and the assessing officer is of the opinion that that person is liable to pay tax, the assessing officer may determine, to the best of the assessing officer's judgment, the amount of that person's taxable income and assess that person accordingly, provided that such an assessment does not affect any other liability of that person for having failed to submit or for having neglected to submit a return.
Power to Assess in Special Cases§
145a.
The assessing officer may determine, to the best of the assessing officer's judgment, the amount of the taxable income of a taxpayer who is the owner of a micro-business of a type prescribed by the Minister of Finance and who maintained records as required by the Director's instructions pursuant to section 130, if the assessing officer is of the opinion that the taxpayer's income according to those records is not reasonable, provided that the taxpayer's books shall not be treated as inadmissible by reason thereof.
145a1.§
(Repealed — תשע״ח)
Partial Assessment§
145a2.
(a)Where a person has reported in a return under section 131 on a transaction designated under subsection (g) of that section as a transaction subject to reporting, the assessing officer may, in addition to what is stated in section 145, determine according to his best judgment in a partial assessment the amount of that person's income relating to that transaction, as well as the deductions, set-offs and exemptions permitted from the income under any law and the tax that person is liable for, provided that by that date he has not determined an assessment for that person under section 145 for that tax year.
(a1)
(1)Where a person has submitted a return under section 131 and the assessing officer has found it appropriate to conduct an assessment with respect to one subject or subjects from that return, the assessing officer may, in addition to what is stated in section 145, determine according to his best judgment in a partial assessment the amount of that person's income relating to that subject or subjects, as well as the deductions, set-offs and exemptions permitted from the income under any law and the tax that person is liable for, provided that at that date he has not determined an assessment for that person under section 145;
(2)An assessment under paragraph (1) may be determined only once with respect to the same tax year;
(3)The assessing officer shall notify the taxpayer of the subject or subjects that he intends to examine before deciding whether to determine a partial assessment under this subsection.
(b)An assessment under this section may be made in accordance with an agreement with the taxpayer.
(c)A partial assessment under this section shall have the same status as an assessment referred to in section 145(a) for all purposes and matters, including for the purposes of sections 147, 150, 152, 153 or 158a; however, a partial assessment shall not derogate from the powers of the assessing officer or from the rights of the taxpayer with respect to the assessment of the remainder of the taxpayer's income, in accordance with the provisions of this Chapter.
(d)Where a partial assessment and an assessment with respect to the total income of the taxpayer have been determined for the same tax year, including an assessment determined by agreement, by Order or by judgment, the assessing officer shall determine their mutual implications and shall make the required adjustments.
Disqualification of Books for Failure to Record Receipts or Failure to Maintain a Cash Register§
145b.
(a)
(1)Where a taxpayer who records his receipts on a cash register roll, receipt slip, invoice, daily turnover book or other document that he is required to maintain under the directions of the Administrator by virtue of section 130 has not recorded therein a receipt that he was required to record under those directions, his books shall be deemed inadmissible, unless the assessing officer was satisfied that there was sufficient reason for the failure to record; a person who disputes a decision given under this paragraph may request the assessing officer as defined in section 130(k)(2), within 30 days of the date of receipt of the decision, to reconsider and amend it; where the assessing officer has rejected the request to amend the decision, in whole or in part, the decision may be appealed as though it were an Order under section 152(b), provided that the time for filing the appeal shall be 60 days from the date of the decision;
(2)
(a)Where a taxpayer has, on two or more occasions in one tax year, or in twelve consecutive months in two tax years, failed to record a receipt that he is required to record as stated in paragraph (1), at least one of which occurred after the assessing officer had warned him in writing, there shall be a presumption that his books are inadmissible also for the two tax years preceding the year in which he twice failed to record a receipt as aforesaid, or also for the tax year preceding the first year within the twelve months in which he twice failed to record a receipt as aforesaid, even if his returns were accepted and assessments were made accordingly, unless the assessing officer was satisfied that there was sufficient reason for the failure to record; an amended assessment for the tax years referred to above as a consequence of the failure to record the receipts may be made by the assessing officer and shall be deemed as though it were an Order under section 152(b);
(b)Against the decision of the assessing officer not to accept the reason for failure to record as sufficient, an appeal may be filed as though it were an Order under section 152(b), provided that the time for filing the appeal shall be 60 days from the date of the decision or together with the appeal against the assessments made as a consequence of the failure to record the receipts; where the court has not accepted the appeal with respect to the said decision but has accepted the appeal against the assessments, in full, with respect to the determination of the assessing officer due to the failure to record the receipts, the said presumption of inadmissibility shall not apply with respect to the years preceding the year in which the failure to record a receipt was discovered.
(b)Where a taxpayer is required to maintain a cash register roll under the directions of the Administrator by virtue of section 130 and has not maintained it, his books shall be deemed inadmissible.
(c)
(1)An institution within the meaning of section 130(a)(4) that on two or more occasions in twelve consecutive months has failed to record a receipt that it is required to record under the directions of the Administrator by virtue of section 130(a)(4), its books shall be deemed inadmissible, unless the Administrator was satisfied that there was sufficient reason for the failure to record;
(2)Against the decision of the Administrator not to accept the reason for failure to record as sufficient, an appeal may be filed, as though it were an Order under section 152(b), within 60 days of the date on which notice thereof was delivered to the institution.
(d)Where the assessing officer has found that a receipt was not recorded, as stated in this section, in an amount exceeding an amount prescribed by the Minister of Finance, he may seize and forfeit half of the amount of the unrecorded receipt, unless he was satisfied that there was sufficient reason for the failure to record; against the decision of the assessing officer an appeal may be filed as though it were an Order under section 152(b), provided that the time for filing the appeal shall be within 60 days of the date of the decision; for the purposes of this subsection, "assessing officer" – excludes a deputy assessing officer, an assistant assessing officer and a chief collector.
Committees for Admissibility of Books§
146.
(a)
(1)The Minister of Finance, in consultation with the Minister of Justice, shall appoint persons from whom the Administrator shall constitute committees for the admissibility of account books;
(2)Each such committee shall consist of three members; its chairperson shall be a public figure with expertise in accounting, and the other two members shall be accountants, only one of whom is an employee of the State or another governmental institution;
(3)Notice of such appointments shall be published in Reshumot (Official Gazette).
(b)In an appeal against a decision of the assessing officer under section 130(c) or against a decision of the Administrator under section 147 in connection with the admissibility of account books, they are required to justify their decision.
(c)When hearing an appeal against a decision of the Administrator under section 130(a)(2), the committee may confirm the Administrator's decision or reject it, or decide in another manner as it sees fit.
(d)When hearing an appeal against a decision of the assessing officer under section 130(c) or against a decision of the Administrator under section 147 in connection with the admissibility of account books, the committee may do one of the following:
(1)confirm the decision of the assessing officer; in so doing it may determine that the books are inadmissible under aggravating circumstances;
(2)set aside the decision of the assessing officer and direct him to accept the books, either because there were no deficiencies or deviation from the directions of the Administrator, or because the deficiencies or deviation in the books are immaterial to the determination of the taxpayer's income.
(d1)(Repealed)
(e)The decision of the committee on an appeal under section 130(a)(2), (d) or (h) shall be final; however, it may bring a legal question to the opinion of the District Court.
(f)The committee is empowered to gather evidence for the purpose of exercising its powers under this Ordinance.
(g)The committee may award the costs of the appeal, including the fees of the taxpayer's representative and the travel expenses and lost-time payments of witnesses.
(h)The Minister of Justice may make Regulations regarding –
(1)the procedures for convening the appeals committees;
(2)the rules of procedure of the committee;
(3)the fees payable in respect of proceedings before the committee;
(4)the remuneration of committee members.
Power of the Director to Review and Amend§
147.
(a)
(1)The Director may, on his own initiative or at the request of the taxpayer, within the period ending one year after the periods prescribed in section 145(a) or 152(c), whichever is the later, or within six years from the day on which an assessment was made for the taxpayer under section 145(b), as the case may be, require the record of any proceeding under this Ordinance taken by the assessing officer, and upon receipt of the record he may conduct any inquiry that appears to him appropriate, or cause such an inquiry to be conducted, and he may, subject to the provisions of this Ordinance, give in the matter any Order that appears to him appropriate;
(2)Where the taxpayer has been convicted of an offence under sections 216(8), 216b, 217 to 220 or under sections 117(b)(1), or (3) to (8), 117(b2) or 117a of the Value Added Tax Law, or a composition has been imposed on him under section 221 or under section 121 of the Value Added Tax Law, the Director may act as stated in paragraph (1) within a period ending one year from the day of conviction or from the day of payment of the composition, as the case may be, or until the end of the period prescribed in paragraph (1), whichever is the later;
(3)Where a person has submitted a report under section 145(a)(1) and the assessing officer has not exercised his power under section 145(a)(2), the Director may act as stated in this section only if the taxpayer has been convicted of an offence under sections 216(8), 216b or 217 to 220 or a composition has been imposed on him under section 221.
(b)An Order under subsection (a) shall be given by the Director or by a person authorised by him to do so, and an assessment made pursuant to an Order so given shall, for the purpose of appeal, have the same effect as the Order.
(c)An Order under subsection (a) that increases the assessment shall not be given unless the taxpayer has been given a reasonable opportunity to state his arguments.
(d)An Order under subsection (a) that increases the assessment shall, for the purpose of appeal, have the same effect as an Order under section 152(b).
(e)An Order under subsection (a) that reduces the assessment, given before the expiry of the time for filing an appeal against the assessment but before an appeal has been filed, shall extinguish the taxpayer's right to appeal against that assessment, but the taxpayer may appeal against the Order as if it were an Order under section 152(b).
(f)Where an Order under subsection (a) is given after an appeal against the assessment has been filed but before the appeal proceedings have concluded, it shall be dealt with as if it were an appeal against the Order.
Assessment Lists and Notice of Assessment§
148.
(a)The assessing officer shall prepare, as soon as practicable, lists of persons who have been assessed for tax.
(b)Such lists (hereinafter – assessment lists) shall contain the names and addresses of the taxpayers, the amount of taxable income of each of them, the amount of tax paid by each, and such other particulars as have been prescribed.
(c)Where complete copies of all notices of assessment and all notices amending assessments are filed in the office of the assessing officer, they shall constitute the assessment lists for the purposes of this Ordinance.
Notice of Assessment to Taxpayer§
149.
The assessing officer shall cause every person whose name appears on an assessment list and for whom an assessment has been made under this Ordinance to be served, by hand or by registered post, with a notice addressed to him at the address of his usual place of residence or place of business, setting out the amount of his taxable income, the amount of tax payable by him, and his rights under section 150 or section 153, as the case may be.
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