The osek patur (exempt dealer) ceiling for 2027 has not been published yet. Under section 126 of Israel's VAT Law, the amount is adjusted every January 1 to the rise in the consumer price index as known on the preceding December 15, and rounded to the nearest shekel. So the 2027 figure can only be set after the index comes out in mid-December 2026. The baseline is ILS 122,833 for 2026, up from ILS 120,000 in 2024 and 2025. The ceiling is measured on turnover across all your businesses, not on profit.
Last updated: November 6, 2026. The 2027 osek patur ceiling has not been published yet. It can only be set once the consumer price index comes out in mid-December 2026, and we will update this page as soon as the figure is out.
Israel's osek patur ceiling for 2027 has not been published yet. Under the VAT Law it will be adjusted on January 1, 2027 for the rise in the consumer price index and rounded to the nearest shekel. The baseline is ILS 122,833 for 2026. If prices went up, the 2027 ceiling will be a little higher, but until it is published, plan around the 2026 figure.
An osek patur is a small sole trader who is exempt from charging VAT. The trade-off is that you cannot reclaim the VAT you pay on business expenses, and you lose the status once your turnover passes the ceiling.
Section 1 of the Value Added Tax Law defines an osek patur as a dealer whose turnover in all of their businesses does not exceed the amount set in the law. Under section 126(a), that amount is:
The Minister of Finance can also set a higher amount. As of this update, we have found no announcement of an increase for 2027.
Note that the 2025-2027 freeze on income tax indexation (see Israel tax brackets 2027) covers amounts under section 120B of the Income Tax Ordinance. The osek patur ceiling is set in the VAT Law, and it was in fact updated for 2026 while the brackets stayed frozen.
Some professions cannot register as an osek patur at all, whatever their turnover. According to Kolzchut, these include lawyers, accountants, engineers and architects. For the bigger picture of what you owe as a freelancer, see what taxes a self-employed person pays in Israel.
Once your turnover passes the ceiling, you no longer meet the definition of an osek patur and need to become an osek murshe: add VAT to your invoices, file regular VAT reports and reclaim VAT on business expenses. A few things worth doing now:
We handle the switch from osek patur to osek murshe in English, from timing to the first VAT reports, and keep going as your osek murshe accountant afterward. Close to the ceiling, or not sure what counts? Book a consultation call with our English-speaking team or call +972-52-448-5784. Meetings are by appointment in the Tel Aviv area.
It has not been published yet. Under section 126 of the VAT Law, it will be adjusted on January 1, 2027 to the rise in the price index as known on December 15, 2026, rounded to the nearest shekel. The 2026 ceiling is ILS 122,833.
No. The ceiling is set in the VAT Law, not in section 120B of the Income Tax Ordinance. It rose from ILS 120,000 to ILS 122,833 in 2026 while the income tax brackets were frozen.
On turnover, meaning your total business receipts before expenses. The VAT Law counts turnover across all of your businesses together.
Once your turnover passes the ceiling, you no longer meet the definition of an osek patur and need to become an osek murshe: charge VAT, file VAT reports and reclaim VAT on expenses. Track your turnover during the year, not just at year-end.
No. Certain professions, such as lawyers, accountants, engineers and architects, must register as an osek murshe regardless of turnover.