How to issue invoices in Israel: the complete guide for businesses

The short answer: to issue invoices in Israel, start by choosing the right document: a licensed dealer or company issues a tax invoice for a sale, a receipt for a payment received, or an invoice-receipt when payment is collected on the spot, while an exempt dealer issues receipts. A valid tax invoice includes the business and client details, a sequential number, a date, a description, the amount before VAT, the VAT and the total, and since 1 June 2026 an invoice above 5,000 NIS before VAT generally also needs an allocation number from the Israel Tax Authority. You can issue all of these from invoicing software, from your phone, and even from a voice note in WhatsApp.

Most business owners don't get stuck on whether to invoice, but on the questions around it: tax invoice or invoice-receipt? Price quote first? What about the allocation number? This guide covers which documents exist, what a tax invoice must contain, how allocation numbers work, and how to choose invoicing software.

Which document types exist, and when do you issue each one?

First, know which document fits which moment in a deal:

Document type	When you issue it	Allocation number?
Price quote	Before work starts, for the client to approve	No
Pro-forma invoice	A payment request before the tax invoice	No (a pro-forma allocation approval is not an allocation number)
Tax invoice	Billing a client for a service or product delivered	Yes, above the threshold
Receipt	Confirming a payment that actually arrived	No
Invoice-receipt	When payment is collected at the same time as billing	Yes, above the threshold

Rule of thumb: a price quote and a pro-forma come before the deal and don't replace a tax invoice. A tax invoice records the transaction and VAT, a receipt records the money, and an invoice-receipt does both, ideal when the client pays on the spot.

What is the difference between an exempt and a licensed dealer?

Licensed dealers, limited companies and partnerships issue tax invoices and invoice-receipts and charge the client VAT on them. An exempt dealer does not issue tax invoices, so their main document is the receipt, and the allocation number requirement does not apply to those receipts.

Unsure of your status, or about to move from exempt to licensed? Ask your accountant before the next document.

What must a valid tax invoice include?

The exact requirements are set by Israeli bookkeeping regulations and can change, so check the current wording on the Israel Tax Authority website. In general, a valid tax invoice includes:

The issuing business's details: name, address and licensed dealer number or company ID.
The document title ("tax invoice" or "invoice-receipt") and a running serial number.
The date of issue.
The client's details: name and, where required, dealer number or company ID. Without it, an allocation number can't always be obtained.
A description of the service or product, with quantity and price.
The amount before VAT, the VAT amount and the total due.
An allocation number from the Tax Authority, when the invoice requires one.

Good invoicing software handles most of this: automatic numbering, business details set once, client details from your list.

How do you issue a tax invoice, step by step?

Whatever tool you use:

Choose the document type from the table above: a tax invoice, or an invoice-receipt if payment already arrived.
Pick the client from your list, or add a new one with their dealer number or company ID.
Detail the transaction: description, quantity, price, and whether the amount includes VAT.
Confirm the allocation number if the amount before VAT is above the threshold.
Send it to the client by email, WhatsApp or link, and keep a copy.
Track the payment and issue a receipt when the money arrives.

Israel Invoice: when do you need an allocation number?

The Tax Authority's Israel Invoice model is designed to reduce fictitious invoices. Under it, a tax invoice or invoice-receipt above a set threshold needs a unique allocation number from the Tax Authority, printed on the original invoice. From 1 June 2026 the threshold dropped to 5,000 NIS before VAT.

Two points to remember:

The threshold is measured before VAT, not on the total.
The allocation number matters mostly to the client. Without a valid number on an invoice that requires one, the client may not be able to deduct the input tax.

You can request an allocation number manually through the Tax Authority's digital services, or use an invoicing system connected to the Tax Authority that requests it automatically while issuing. Authorisations, refusals and retroactive requests are covered in our full guide to Israel Invoice and allocation numbers.

Can you issue an invoice from your phone, WhatsApp or by voice?

Yes. Instead of waiting for the evening and a computer, you issue the document the moment the job ends. At DocMe (דוקמי) we built DocMeDocs (דוקמי דוקס) as an invoice app for WhatsApp and Telegram: a personal AI assistant that issues tax invoices, receipts, invoice-receipts, price quotes and pro-forma invoices from a voice note, in full Hebrew. An example from the field:

An electrician finishes a job and records in WhatsApp: "Invoice-receipt for the Cohen family, 1,200 shekels plus VAT, replaced the electrical panel, paid by bank transfer."
The assistant finds the client in your list, even from half a name, and builds the document with your business details and VAT.
If an allocation number is required, it is pulled from the Tax Authority and stamped on the document.
The document is sent and enters tracking: sent, seen, paid.

See the whole flow on video in our post on issuing an invoice by voice.

How do you choose invoicing software in Israel?

Ask these questions before you commit:

Does it support Israel Invoice and request allocation numbers automatically?
Where can you issue from? Only a computer, or also your phone, WhatsApp or Telegram?
Which documents does it issue? Including price quotes and pro-formas, not only tax invoices.
Does it track payments and remind you about unpaid documents?
How does your accountant get the data? Sync, Excel and PDF export, or a link to the bookkeeping system.
Is there an API for connecting a CRM, online store or website?
How many documents are included each month, and what does each extra one cost?

For comparison, here is how DocMeDocs plans are built (per month, before VAT): Basic at 29 NIS with a web dashboard and up to 40 documents a month; Pro at 49 NIS, adding the Telegram bot, full sync with the DocMe AI app and income and client management, up to 60 documents; and Premium at 89 NIS, adding WhatsApp alongside Telegram, up to 200 documents. Every plan includes Israel Invoice support, a free API and MCP server, and a free trial.

Common invoicing mistakes

Issuing a tax invoice when payment already arrived, then forgetting the receipt. An invoice-receipt is simpler.
Sending a pro-forma and treating it as an invoice. It doesn't replace a tax invoice.
Checking the allocation threshold including VAT instead of before VAT.
Leaving out the client's dealer number or company ID when it is required.
Editing an invoice that was already sent instead of issuing a credit note.
Leaving invoicing to the end of the month and reconstructing from memory who bought what.

Conclusion

Issuing invoices isn't complicated, but it takes order: the right document, every required detail, the allocation number when needed, and issuing on time. The more your tool does on its own, the faster you get paid.

A simple next step: issue your next invoice the moment the job ends and see how much time it saves. More practical guides are waiting on the DocMe blog.

Frequently asked questions about issuing invoices

Short answers to common questions.

What is the difference between a tax invoice and an invoice-receipt?

A tax invoice records the transaction and the VAT, and an invoice-receipt also records the payment. Issue an invoice-receipt when the client pays at the same time.

Can an exempt dealer issue a tax invoice?

No. An exempt dealer issues receipts, so no allocation number is needed for them either.

From what amount is an allocation number required?

From 1 June 2026, for a tax invoice or invoice-receipt above 5,000 NIS before VAT. Confirm the current rules on the Israel Tax Authority website.

Can I issue a tax invoice from my phone without a computer?

Yes. With DocMeDocs you can issue an invoice from a voice or text message in WhatsApp or Telegram, including the allocation number and delivery to the client.

How much does invoicing software cost?

Prices vary between providers. DocMeDocs plans start at 29 NIS a month before VAT, with a free trial.

What if I made a mistake on an invoice that was already sent?

Don't delete or edit it. Issue a credit note, then a new, corrected invoice.