Invoice allocation numbers: when you need one, how to get it, and what happens without it
What an allocation number is, when it became mandatory, how to get one — and what happens to your customer if the invoice does not have one.
The Makor teamUpdated: 13 October 20268 min read
What is an allocation number?
Allocation numbers are part of the "Israel Invoices" model. The goal is to make sure that tax invoices used to deduct VAT were actually issued and reported. The business issuing the invoice requests a number from the Tax Authority, and the number appears on the invoice itself.
For the business customer it is simple: an invoice above the threshold without an allocation number means no VAT deduction. That is why business customers make sure to ask for it.
When is it mandatory? The threshold over the years
The threshold is coming down in stages. Amounts are before VAT, and an invoice needs a number when its amount is above the threshold:
- ₪25,000From 5 May 2024
- ₪20,000From 1 January 2025
- ₪10,000From 1 January 2026
- ₪5,000From 1 June 2026 — In force today
Who does it apply to?
The requirement concerns tax invoices (including tax invoice-receipts) issued to a business customer. A few common cases:
| Case | Allocation number needed? |
|---|---|
| Tax invoice to a business customer, above ₪5,000 before VAT | Yes |
| Tax invoice up to ₪5,000 before VAT | No |
| Invoice to a private (non-business) customer | No |
| Exempt dealer issuing a receipt | No — no tax invoice |
How do you get an allocation number?
There are two ways: request one manually in your personal area on the Tax Authority website, or use invoicing software that is connected to the Authority and requests the number at issue time.
- Connect the business to the Tax Authority once — from within the software.
- Issue the invoice as usual. If the amount is above the threshold, the request is sent at issue time.
- The number appears on the invoice before it is sent to the customer.
What happens without an allocation number?
The invoice is still a document of your business, but the business customer cannot deduct the input VAT on it. In practice, many customers will ask for an invoice with a number — which can delay payment.
So it is worth making sure the number is received before the invoice is sent, rather than finding out only when the customer calls.
Frequently asked questions
Does the threshold include VAT?
No. The threshold is checked against the invoice amount before VAT. Today it is ₪5,000.
What if I split a deal into several invoices?
The threshold is checked per invoice. Even so, artificially splitting one deal to stay below the threshold is not advisable. If you have such a case, consult your accountant.
Can I request an allocation number below the threshold?
Yes. In Makor you can request an allocation number for a tax invoice below the threshold too, when it carries the customer's VAT number. Above the threshold the request is sent automatically.
How long does it take to get a number?
When the software is connected to the Tax Authority, the request is sent at issue time and the answer usually arrives quickly. If the Authority is unavailable, the invoice waits until a number is received and is not sent to the customer without it.
This information is general and is not tax advice. Before a decision that affects your business, check with an accountant or tax advisor.
Need an allocation number?
Type an amount to check it against the threshold in force today.
Assumes a tax invoice or tax invoice-receipt to a business customer. The amount is not saved or sent.