The Israel Tax Authority made a major update to System 1000 beginning January 2023.
System 1000 allows bookkeepers to upload a file of supplier information to SHAAM and retrieve a file of current withholding rates and bookkeeping information for the suppliers. This information is then interfaced to the supplier withholding certificate and bookkeeping certificate information in the ERP system.
For bookkeepers of Israeli ERP systems, the major change is the addition of a new withholding group – Rents. Previously, most bookkeepers used the Assets & Services withholding group for payments to suppliers for rent of office space, warehouse, manufacturing facilities and rental properties. Where the Supplier has Rent as a valid category it will now be necessary to use the new withholding group Rents for these suppliers. Should the supplier not have Rent as a valid category we suggest discussing the situation with your tax advisor. The Rent category has a withholding reporting code of 13.
In January, the Israel Tax Authority updated the SHAAM 1000 site with the new system as well as keeping the option to continue using the previous system. The new system the following changes:
Outbound File – the addition of a record labeled Entity ID Number. This allows System 1000 to search for withholding information using the combination of Tax ID and VAT ID as it did in the past and in addition using only the Entity ID number, widening the search and reducing the number of errors returned.
Inbound File – added records:
Entity ID returned
Tax rate of 6th group-Rents
Bookkeeping Start Date
Bookkeeping End Date
Date of Bookkeeping Change
The new fields of information available in the Inbound File are also now available online, when searching the SHAAM interface using the individual or the “ten at a time” options.
The System 1000 interface is an integral part of the Supplier payment process for correctly calculating Supplier Withholding.