Israeli Bureaucracy part II, the accountant

Yesterday, on the advice of a friend, I called an accountant to advise me on being self-employed in Israel. I don't think I posted about it, but about a month ago, I went to the ministry of sales tax and registered myself as a business. I had to do this because the place where I'm practicing acupuncture required me to be an official business. It was a relatively painless process, other than having to go twice because the first time some of the computers were down so I could only do half of the process.

I called the accountant and I can't recall all of it, or capture the sense of his continuing bewilderment at the mis-steps I'd unwittingly taken, but I'll try to write his half of the initial telephone conversation:

"Oh, an acupuncturist, that's great... You've been in Israel since June? that's great. Well, something that I might recommend is to have the place that you work employ you and have your customers pay them, and they pay you, it's much simpler that way... Oh, you can't do that? Well, I guess we'll have to see how to avoid having you register as self-employed as things get really crazy then... Oh My God! You already registered!?! Oh, we're in trouble now, are you charging sales tax from your clients? No... hmmm... what does it say on the form? Oh thank god you are פטור (p'tor). That's the correct designation and might save us some trouble. You got lucky, some of the clerks there like to play with people and intentionally give them the wrong designation. It's not that they're cruel, it's more that they're bored... ummm... Well at least you haven't been here six months... What!!! You have, and you haven't left the country? Oy ve voy. That's big trouble. No one warned you about that? They didn't tell you what it means? It means that you have to pay income tax this year on every bit of money that you made the whole year, whether here or in the States... No, you won't be double taxed, but the tax rate is higher here, so you may not have paid enough money in taxes in the US. And the exemptions are different. Can you get me your tax returns..? We could have flown under the radar, but since you registered, they are on to you... Yes, I know, even though the money you make here is minuscule. They will think you are hiding income and look at you closer. They assume you are trying to steal from them, it's how they work. I think it would be best if we met. We should meet in person to go over this... Wait wait, are you an oleh? (An immigrant) No. You're temporary residents? That might be good, I'll have to look this up, but I think there is an exemption for you for your foreign income. We should just meet."

So next week, we'll meet... and I'll probably find out that the $125 a week I make by practicing acupuncture one afternoon a week is going to cost me a lot more than that in taxes.