Set up a Limited Liability Company in Israel

A limited liability company in Israel can be set up with at least one shareholder and no minimum share capital requirement. The registration of a LLC in Israel is an easy process which can be entirely explained and assisted by our team of company formation agents in Israel. Our advisors can also provide support when applying for special licenses and permits to properly start the activities as a new business in Israel.

Phases of an LLC incorporation in Israel

The first step in company registration in Israel is the name reservation: this must be unique and must end with "Ltd." (Hebrew: בע"מ). The following requirements are also part of a LLC incorporation in Israel:

• draft the Articles of Association;
• provide copies of the documents of the owners (ID and passports);
• offer details about the business office;
• appoint the directors of the company;
• have the shareholders' and directors' declarations signed before an Israeli lawyer (or a notary with apostille if signed abroad);
• designate the company's registered office address in Israel;
• register for tax purposes in Israel.

Once the registration certificate is issued by the Registrar of Companies in Israel, the company must register with the Israel Tax Authority (income tax and VAT) and, as an employer, with the National Insurance Institute and then consider the services of an accountant who will take care of the financial transactions of the company.

The benefits of registering an LLC in Israel

An LLC in Israel comes with varied advantages among which we mention the most important one: the shareholders are not responsible for the debts and liabilities of their company. For instance, the stockholders are not obliged to pay the debts from their own finances if the company faces bankruptcy. Another interesting advantage of an Israeli LLC is that the company can later become a public company and offer shares to the public under a prospectus approved by the Israel Securities Authority. This can attract investments and funds in the company.

Dividends of an LLC in Israel

The profits of an LLC in Israel are distributed in form of dividends to the owners of the business. In this matter, the board of directors must confirm that the distribution comes out of profits and that there is no reasonable concern it will prevent the company from meeting its existing and expected liabilities (Companies Law, s. 302) after the distribution of the dividends.

For a better understanding of the requirements related to an Israeli LLC, we invite you to contact our advisors in company formation in Israel.