01
Obstacle
Tax rates mix on invoices — the VAT return does not balance.
Solution
Rate applied per line item automatically; output/input split matches PCN874 fields.
VAT Return 18 % (PCN874)
Israel's standard VAT rate is 18 % (2025). Businesses file the PCN874 report periodically with the ITA. ITA-cleared invoices with allocation numbers are the authoritative data source for both output and input VAT.
02
Obstacle
Input VAT from invoices without an allocation number is disallowed.
Solution
Every incoming invoice is validated for a valid ITA allocation number before input VAT is booked.
How often is the PCN874 filed?
Most businesses file bi-monthly; large businesses (above the ITA threshold) file monthly.
PCN874 ready to submit
Cleared invoices feed the return automatically.
