Tax registration number

Requirement

All companies are given an identification number, named organization number, by authorities. This number is used when reporting corporate information to the government.

All countries that have VAT as a method of taxation require a VAT registration number. This number is often the organization number, with the addition of the country code.

In Israel, there are three standard VAT rates:

17% - this is the standard rate that applies to most goods and services.

13% - this rate applies to certain products, such as fruits and vegetables, water, gas and electricity for households, books, newspapers, and magazines, and more.

0% - this rate applies to certain products and services that are exempt from VAT, such as exports, certain medical equipment, and medications, and more.

There are also certain products and services that are exempt from VAT altogether, such as education, healthcare, and financial services.

In Israel, the VAT registration number is called "מספר עוסק מורשה" (Mispar Osek Mursheh) in Hebrew. It is also commonly referred to as the "VAT number" or "tax ID number".

This number is assigned to businesses that are registered with the Israeli tax authorities for Value Added Tax (VAT) purposes.

The VAT registration number consists of nine digits and begins with the prefix "IL", which stands for Israel:

IL 123456789

מס' עוסק מורשה / ח"פ

If there are less than 9 digits in the number, zeros should be padded to the left side of the number.

M3 solution

The organization number, tax number, and VAT number of the company are stored on the division. The VAT numbers of the company’s customers and suppliers are stored per customer and supplier. EU VAT numbers can be validated online by M3 towards the European VIES portal.

The supplier’s VAT registration numbers are validated towards the VIES in a simplified way once the validation has been activated.

For more information, see NCR 11868, the M3 Business Engine User Documentation Infocenter and the Launch Documentation for EU070 "EU VAT Reg. No. Validation".

Configuration guidelines


Program ID	Program name	Description or comment
MNS100/G	Company. Connect Division	Specify the VAT and business identification numbers of the entity. In the VAT reg no (VAT registration number) field, specify the VAT number (Mas Hachnasa). Add the characters: IL, then the 9-digit number that begins with the digits "51", and is followed by seven additional digits. In the Org no 1 (Organization number 1) field, specify the organization number (MISPAR ZEHUT), the unique identification number assigned to all businesses operating in Israel. The organization number is an 8-digit number.
APS025	Supplier Activity Code. Open	Create the activity codes. Connection with ‘Supplier. Define Purchase & Financial’ (CRS624/F).
CRS610/J	Customer. Open	Specify the VAT numbers of the customer. In the Org no 1 (Organization number 1) field, specify the organization number. In the VAT reg no (VAT registration number) field, specify the VAT number.
CRS620/E	Supplier. Open	Specify the VAT and business identification numbers of the supplier. In the Org no 1 (Organization number 1) field, specify the organization number. In the VAT reg no (VAT registration number) field, specify the VAT number.
OIS002/F	Customer. Connect Addresses	Optionally, in the VAT reg no field, specify the TVA registration number.

Possibly activate the EU online VAT registration number validation for EU customers and suppliers

In an initial run of 'VAT Registration Number. Select Operation' (TXS160), the VAT registration numbers of customers and customer addresses are stored in a new VAT registration number master file on company level to be used from all divisions.

If a new VAT registration number is added, or changed, in the customer master file or address master file, it is automatically stored in the new VAT registration number master file with status "new" and is validated within the next validation run.

The validation result of every validation, run in (TXS160) towards VIES according to the validation policy per base country code, is stored in parallel in the new VAT registration number master file with a detailed validation history.

The new VAT registration number master file is optionally used at the moment of the M3 VAT decision at invoicing.

By using the TXS070MI API transactions, the validation can be added or run at almost any place in M3 based on the customer’s needs.


Program ID	Program name	Description or comment
CMS975	Feature List. Open	Ensure NCR 11868 is activated.
TXS003	VAT Reg Number Validation Policy. Open	Create one record for the base country used for invoicing: Set Validation meth to 1-'VIES'. Define the Comp VAT reg no to be used as requester's VAT reg. no. Define the frequency of the validation of a VAT reg no by Meth expirat dt and optionally Days betw valid. Decide if the result of the latest VAT reg. no. validation should be used for the VAT decision at invoicing by Add VAT. Define the VAT responsible.
TXS011	Validation Policy. Open Local Exemptions	Optionally, define per division and invoicing base country code the VAT responsible and 'Add VAT' rule differing from the general 'VAT Reg Number Validation Policy. Open' (TXS003) rules defined.
TXS160	VAT Registration Number. Select Operation	Run the initial run (TXS160 – option 'Initial load') to update the new VAT reg. no. master table. Run the validation on demand (TXS160 – option 'Validation') for a range of VAT reg numbers or base country codes.
TXS070	VAT registration number. Open	Check the validation result if required. This might be required. Run the validation manually per single VAT reg. no. record if required.
SHS030	Job Schedule Function. Open	Define a scheduled validation run.