cpa in israel

Voluntary disclosure procedure – everything you need to know

In recent years, more and more news is published about celebrities who have evaded taxes. The biggest headline was captured by singer Kobi Peretz, who was convicted of tax evasion amounting to millions of shekels. Tax evasion can be carried out as a one-time act, but it can also be the product of a continuous pattern in which people conduct themselves “in the dark” and do not report their personal capital, income and profits in a transparent manner.

Today, more than ever, the tax authorities can identify and locate those people who evade tax as a method. How do they do it? With surveillance, direct information received from “informants”, and also through surprise audits that reflect an unequivocal picture: tax evasion is taking place.

Tax evasion often evokes feelings of great concern, of “what will happen if…”. Those people who have committed the offense, often want to win another chance to correct what they have done, when they can give themselves this opportunity. A voluntary disclosure procedure is a process in which a correction can be made on the tax offense committed, when those people must pay the tax required of them.

It is important to understand that this is a two-sided process, when each of the parties comes out of it hired:

The tax evaders remove a huge stone from their hearts without having to fear that they will face criminal prosecution.
On the other hand, the tax authorities get to receive huge sums of money that are stolen from them.
A voluntary disclosure procedure exempts tax evaders from the taint of being charged with a criminal offense, when often paying the tax as required and on time prevents heavy penalties in the form of actual prison terms.

The motivation of many: to pay as little taxes as possible
It seems that not a single person wants to pay taxes, and every person – both the employee and the self-employed, would be happy to put as much money as possible into their bank account every month. However, the reality is different: every citizen is required to pay taxes determined according to the level of his income. However, there are those who try to find possible ways to pay as little tax as possible, when those ways do not correspond to the sane law that he recognizes.

Voluntary disclosure process: without fear of the taint of a criminal offense
There are small businesses that do not report the income as required, when instead of typing the amount of the purchase in real time in the cash register of the business, they open it manually and thus avoid paying tax on many transactions. Just before the tax authority rises above what is being done and acts accordingly, it is possible to stick to the voluntary disclosure procedure and put an end to the conduct that creates tensions on the one hand, and categorizes its perpetrators as “tax offenders”.

A voluntary disclosure process actually gives those “offenders” another opportunity to correct what they did, with a full statement of all their earnings that were not reported as required. A voluntary disclosure procedure is not relevant and is intended only for the big tycoons or huge companies, but also for the small citizen.

Not every accountant can
The procedure of voluntary disclosure is a complex and complicated procedure that requires familiarity with the intricacies of the law as well as the criminal aspect of the law. Not every accountant deals with this and understands the meanings of each and every thing. The Voluntary Disclosure Department at the Ben Shmuel office is managed by Mr. Yosef Ben Shmuel, who was a tax assessor for Tel Aviv and Central Investigations and served in various positions in the tax departments for over 36 years. Mr. Ben Shmuel knows all the ins and outs of the subject and will be able to help you reach a safe beach.

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