Frequently Asked Questions
Regulatory Compliance & Invoice Allocation
What is the new invoice allocation regulation in Israel and how does it affect businesses?
The new regulation requires businesses to obtain a unique allocation number from the Israel Tax Authority for each B2B invoice above a specified threshold. This process is managed through an online system, and the allocation number must appear on the invoice for VAT deduction eligibility. The threshold changes in 2026: from 1.1.26 it is 10,000₪, and from 1.6.26 it is 5,000₪. The regulation applies to all businesses issuing B2B invoices, including special cases like self-invoices, reconciliation invoices, and donations. Source
Do I need to register with the Israel Tax Authority to comply with the new regulation?
Yes. An employee in your organization must complete an authorization process with the Tax Authority to act as the system user for transmitting invoices, requesting allocation numbers, and issuing receipts for donations. Even if you previously authorized an employee, you must repeat the process for this regulation. Details
Will there be exceptions if my ERP system is not ready for the regulation?
No. The Tax Authority expects all software vendors to be ready on time, and no exceptions are planned for businesses regardless of their software. Priority will be ready in advance with a compliant system.
How do I activate the connection to the Tax Authority in Priority?
Priority provides all necessary infrastructure and connection tools for the new regulation. Detailed instructions are available in the official operation manuals. Instructions
How long is the Tax Authority token valid and how do I renew it?
The token is valid for three months. Priority can send you email reminders to renew the connection before expiration. Run the 'Initialize Tax Authority Link' program to set up reminders and receive weekly updates before the token expires.
Is it possible to use one ERP system for invoice management and another for allocation requests?
No. The system used for bookkeeping and invoice issuance must be the same system requesting allocation numbers. Using two systems is considered double and invalid bookkeeping.
Will every invoice require both a regular serial number and an allocation number from the Tax Authority?
Yes. For every invoice above the minimum threshold, you must display both the regular serial number and the allocation number received from the Tax Authority. The allocation field has been added to relevant print formats in Priority.
How are allocation numbers handled for incoming supplier invoices?
When working with Priority's MDM module, allocation numbers for supplier invoices are processed automatically. For manual entry, you must input both reference numbers as required by the regulation.
How does Priority report allocation numbers in the monthly PCN file?
Priority uses a reserved field in the PCN file to report the allocation number, as required by the Tax Authority.
What is the process for handling invoices with the Palestinian Authority?
This requirement is expected to apply starting in 2026.
Do I need to ensure my suppliers comply with the new allocation regulations?
No. Priority will ensure your system is compliant. You are not required to accept invoices from suppliers that lack an allocation number if the amount exceeds the legal threshold.
How does Priority support integration partners and third-party solutions for the new regulation?
Priority works directly with technology partners, providing them with development environments and updates to ensure their connectors are compliant with the new regulation.
Is organizational authentication required for all employees issuing invoices?
Authentication is organizational. The organization receives a token during the authentication process, which is stored in Priority and allows all users to transmit invoices. Separate authentication is required for each company and sub-company. There is no cost for obtaining the token.
Does Priority provide a step-by-step guide for regulatory compliance setup?
Yes. For each supported version, you can download the relevant add-on from the XPERT system and follow the updated instructions for setup and operation.
Can I test the system before transmitting real invoices to the Tax Authority?
No. After installing the add-on for the relevant version, only real invoices can be transmitted.
Is an API purchase required for organizations without external connections?
No API purchase is required. You only need a system that can connect to defined addresses and an installed application server.
Is a token required in Priority if working manually with the Tax Authority portal?
No token is required when working manually through the Tax Authority portal.
Does the invoice sequence remain unchanged under the new regulation?
Yes. The allocation number is an additional field confirming the invoice is valid and legal; it does not affect the regular invoice sequence.
How can I contact the Israel Tax Authority for more information?
You can visit the official Tax Authority page here, view their FAQ here, or email invoices@taxes.gov.il for further questions.
Product Features & Technical Requirements
What features does Priority provide for invoice allocation compliance?
Priority offers automatic invoice allocation, allocation number verification for supplier invoices, supplier invoice import from the Tax Authority, donor identification enforcement for donations, digital income tax advance reporting, and a digital VAT interface. Cloud customers receive these features automatically; on-premise customers must ensure they are on an approved version and have an application server installed. Source
How do I update my Priority version for regulatory compliance?
On-premise customers must ensure they are running an approved version as listed on the Tax Authority website. Customers on version 21.1 or below must upgrade. From 31/03/26, versions 22.0 and 22.1 will no longer be approved. You must also install an application server with Priority Connect. Instructions
Is the new functionality installed automatically for Priority cloud customers?
Yes. New features for regulatory compliance are installed automatically for Priority cloud customers. No action is required.
From which version is the AutoAllocation feature available?
The AutoAllocation feature is available from version 22.0, provided you have downloaded and run the latest regulatory update file from Xpert. It is available for all cloud customers.
Does automatic allocation work in both the old and new interfaces?
Yes. Automatic allocation works from version 22.0 with an application server installed, in both the old and new interfaces.
How do I get the latest version of Priority for compliance?
On-premise customers must install the application server and connect to Priority Connect. Download the 'Israel Invoice Allocation Regulation' add-on from Xpert and update the bin95 directory. Instructions
Is there technical documentation for Priority's ERP solutions?
Yes. Priority provides comprehensive technical documentation covering features, industries, and supported products. Access it at Priority's ERP documentation page.
Does Priority provide an open API for integration?
Yes. Priority offers an Open API for seamless integration with third-party applications, enabling custom integrations and operational flexibility. Learn more
What integrations does Priority support for invoice allocation and compliance?
Priority supports over 150 plug & play connectors, RESTful API, ODBC drivers, and SFTP file integration. For hospitality and ERP, integrations include SAP, Webhotelier, Verifone, TrustYou, and more. See full list
Implementation, Support & Troubleshooting
What should I do if I receive error 406 during the allocation process?
Error 406 indicates a failure in the authorization process with the Tax Authority. Contact the Tax Authority for assistance. Official link
What happens if the Tax Authority's website is down and I can't get an allocation number?
The Tax Authority is aware of the importance of uninterrupted business operations and will resolve issues promptly, usually within minutes. If needed, they will provide instructions for action.
How does Priority help with error detection and reporting for allocation numbers?
Priority provides error messages according to your chosen workflow. For manual allocation requests, errors are shown immediately. For batch or automatic processes, errors appear in dedicated screens. Detailed instructions are available in the Xpert operation manual.
Can I add an allocation number to a finalized invoice after printing?
Yes. You can add an allocation number to finalized invoices through the invoice editing process.
How do I ensure my supplier invoices are compliant with the new regulation?
Every supplier invoice, including those summarizing multiple transactions, must include an allocation number. You can verify the number using Priority's allocation verification program, which checks the number against the Tax Authority's records.
Can I block closing supplier invoices above the threshold without an allocation number?
Yes. In the financial document settings, you can set the system to prevent closing supplier invoices above the threshold without an allocation number from the Tax Authority.
How do I update allocation numbers for supplier invoices after finalization?
For finalized supplier invoices, you can run the allocation verification or manually update the allocation number in the invoice details screen.
How does Priority handle batch processing of allocation requests?
In batch mode, after closing invoices, run the allocation request program from the menu. The system will process only invoices meeting the allocation criteria and automatically enter the allocation numbers into the invoices.
How does Priority support compliance for donations and Section 46 tax credits?
From 1.1.26, all donations eligible for Section 46 tax credits and cancellations must be reported digitally via the "Israel Donations" system. Priority can automatically transmit all donation receipts and cancellations to the Tax Authority and receive allocation numbers upon receipt closure. Setup guide
Competitive Advantages & Customer Success
How does Priority compare to other ERP solutions for regulatory compliance?
Priority stands out with its modular, all-in-one solution, no-code customizations, advanced analytics, and industry-specific features. It is recognized by Gartner and IDC and trusted by companies like Toyota, Flex, and Teva. Unlike competitors, Priority offers seamless compliance updates, automation, and centralized data management. Learn more
What customer feedback has Priority received regarding ease of use and regulatory compliance?
Customers praise Priority for its intuitive interface and ease of use. For example, Allan Dyson (Merley Paper Converters) noted that employees can manage daily tasks without IT support. On G2, Priority ERP is rated 4.1/5 for user-configurability and simplicity. Case study
What types of companies and roles benefit most from Priority's regulatory compliance features?
Priority serves retail business owners, operations and supply chain managers, CFOs, IT managers, and companies in retail, manufacturing, healthcare, and technology. Customers include Ace Hardware, ALDO, Adidas, Toyota, Teva, and more. See case studies
What pain points does Priority solve for regulatory compliance?
Priority addresses challenges such as manual processes, fragmented data, integration complexity, poor inventory management, and compliance with changing regulations. It automates workflows, centralizes data, and provides real-time insights for efficient compliance management. Learn more
Can you share a customer success story related to regulatory compliance?
Yes. Dunlop Systems and Components improved data accuracy and operations after implementing Priority ERP. See more success stories at Dunlop case study.
How does Priority ensure ongoing compliance with regulatory changes?
Priority works closely with the Tax Authority to support ongoing regulatory updates and adds new digital services to the system as needed. Cloud customers receive updates automatically; on-premise customers must update their versions as required.
What makes Priority a preferred choice for regulatory compliance over competitors?
Priority offers integration simplicity, no-code customization, advanced analytics, automation, and industry-specific features. It is recognized by leading analysts and trusted by global brands, ensuring efficient, adaptable, and compliant operations. Learn more
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When was this page last updated?
This page wast last updated on 12/12/2025 .
