Open the chevra baam (llc, ltd)
Нow to open the chevra baam – a firm with limited liability (llc, ltd)
In 1999 Israel adopted a new Law on Companies. Its main provisions are:
- The company is a legal entity, that is, it may perform all the actions necessary for businesses in the country: to have an account with the bank, to close official transactions, to challenge in court the wrongful acts of suppliers or partners. All this is done not on behalf of the owner (this person is physical), but on behalf of the company (a legal entity).
- The company has a charter and has a statutory fund, from which all expenses are incurred, risks are paid off (say, in case of an insurance event or when hiring foreign specialists).
This means that the responsibility of each partner can only be within the limits of its share in this business, fixed in the charter. Therefore, if a new company is organized by a group of partners, one of them cannot be liable (unless the court proves the fact of fraud). This type of firms is optimal for large cash flows and when doing business with foreign partners.
Start of activity
After the goals, objectives, money resources are accurately calculated and the shares are distributed, the first thing to do is to contact a knowledgeable lawyer and/or a serious audit firm (hevrat rohe-heshbon) that has work experience and which will ensure interacting with the fiscal authorities, auditing and accounting support to the Ltd in tax organizations throughout the life of the company.
Auditing firm Brodetsky Shmuel Roe-Hesbon will consult you on all the necessary issues, will offer advice on how to properly keep records, will open registration folders for you in the required fiscal authorities. You are going to grant Brodetsky Shmuel Roe-Heschbon a power of attorney to conduct your cases in various fiscal authorities (ipuy koakh) – and the process of formalizing the fiscal and commercial aspects of your activity will begin.
Registration of a new LLC
The main work in financial institutions will be done for you by the auditor. He, on the basis of the power of attorney issued by you, will register the company and on a regular basis will represent your company in the fiscal authorities.
After the company is approved as a legal entity (a lawyer does it), you can open an account with the bank in the name indicated in the registration certificate, order checkbooks, order the seal and start the activities – say, rent production or office premises, start interviewing recruits, conclude conditional (al tnai) contracts with business partners.
Then the firm undergoes obligatory registration in the VAT department (МААМ). The auditor having your power of attorney will fill in all the required forms that define the scope of the tax deductions. You will need to submit the above documents and a number of others (a receipt for the purchase of goods or raw materials, a sample of a bank check, an imprint of the seal). If you need any more documents, Brodetsky Shmuel Roe-Hesbbon will inform you in advance.
After that, the auditor fills in the documents with the Tax Office, he receives all the registration forms necessary for you (the originals will be stored in your folder, at the office of the rohe-heshbon). Also there will be opened tax collection folders for each of the company’s employees.
Also, employees will be registered at the National Insurance Service, which is responsible for contributions to healthcare and for disbursements as disability or old age benefits. Salaries are calculated and the necessary deductions are charged in accordance with the Israeli law, each employee will see all the amounts paid to him and deducted from him in the payroll (tlush maskoret).
With certain financial turnovers, the owner of the Osek murshe may benefit from re-registering his business as an LLC (Chevra Baam). The auditor will give you a detailed consultation on this issue. What kind of business is more profitable for you to open – Osek murshe or HAVRA BAAM – you can read about the advantages and disadvantages of each type of enterprise in the article “LLC or Osek Murshe – advantages and disadvantages“.
Let’s check the list once again!
To open the limited-liability company (LLC) you will need the following documents:
- Certificate of entry into the general Israeli register of companies.
- Protocol on the establishment, formally signed by a lawyer.
- Lease contract on the premises with revenue stamps.
- A sample check (original, with the inscription “Specimen” and dashes at the place of issue date and signature).
- Impression of the company seal, displaying its profile and line of business.
- Appointment of the directors of the firm (menahalei hevra), signed by the founders, and copies of the identity cards of the company founders.
- Order form for your product or services, confirming the commencement of commercial activities.
- Receipts for the purchase of equipment, goods or raw materials.
If the profile of your company requires some additional documents (certificates of field-specific education recognized in Israel, medical questionnaires, etc.), the auditor will inform you.
All audit support, accounting support to Ltd (accountant services for LLC) will be maintained at the highest level. Our firm is interested in the success of its clients, particularly of new immigrants, and does everything possible to let them achieve a lot.
The firm Brodetsky Shmuel Roe-Heshbon is run under the motto: your success is our success, too!