The amounts have changed – How can you know how much cash you are allowed to pay today?
The Law to Reduce the Use of Cash (2018), came into effect in January 2019 and has since become an integral part of the day-to-day routine of every business in Israel. Since then, the Knesset has updated the threshold amounts set in the law, while many business owners and private individuals continue to rely on the old figures and risk unexpected financial sanctions.
As of 2026, the Constitution Committee has approved additional amendments to the law. In this article, we will outline everything you need to know
What is the purpose of the law?
The widespread use of cash as part of what is known as “black capital”, meaning money concealed from the authorities, has concerned many countries for years. In Israel, the shadow economy is defined as a segment of the market that does not appear in gross national product data, and includes money laundering transactions, criminal activity, and more.
In 2014, the government appointed a committee to examine the reduction of cash payments, headed by the then Director General of the Prime Minister’s Office, Harel Locker. The committee estimated the scope of black capital in Israel at enormous amounts and pointed to its social consequences: harm to social cohesion and the undermining of the rule of law. The government submitted the first bill in July 2015, and the Knesset approved it on March 12, 2018. The Director of the Israel Tax Authority, Moshe Asher, noted that “reducing the use of cash is a change in mindset.”
Restrictions on the use of cash – updated amounts for 2026
The law restricts the use of cash according to the type of parties to the transaction. It is important to know: the amounts that applied in the past have changed. These are the updated amounts:
Type of transaction | Old amount | Updated amount (2026) | Above the amount |
Transaction with a dealer | 11,000 ₪ | 6,000 ₪ | Up to 10% of the transaction price, but no more than 6,000 ₪ + the balance by check / transfer / card |
Between private individuals | 50,000 ₪ | 15,000 ₪ | Up to 10% of the transaction price, but no more than 15,000 ₪ + the balance by check / transfer / card |
Purchase of a vehicle between private individuals | 50,000 ₪ | 50,000 ₪ (unchanged) | Up to 10% of the transaction price, but no more than 50,000 ₪ + the balance by check / transfer / card |
Transaction with a tourist | 30,000 ₪ | 30,000 ₪ (unchanged) | Up to 10% of the transaction price, but no more than 30,000 ₪ + the balance by check / transfer / card |
The restrictions apply both to the person making the payment and to the person receiving it. The restrictions do not apply to payments between relatives (spouse, parents, children, siblings, etc.) – except for salary payments. There are also specific additional restrictions regarding transactions in which one of the parties is an attorney or accountant, in the context of providing a “business service” to a client.
Restrictions on the use of checks
Restrictions also apply to the use of checks:
- Dealer: must state the recipient’s name on every check it gives or receives – Private individual: must state the recipient’s name on any check above 5,000 ₪
- Check endorsement: the name and identification number of the endorser must be stated
2026 update – changes in the field of bill discounting
In 2026, the Constitution Committee approved additional amendments as part of the Economic Efficiency Law, relating to bill discounting:
- Cash discounting of a bill: limited to an amount of up to 6,000₪
- Bill denominated in foreign currency: may be discounted in cash up to 25,000₪
- Conversion / exchange of a bill into cash: up to 25,000 ₪, provided that the dealer presents an invoice with an allocation number and a receipt
- Repayment of a loan granted in cash: excluded from the restriction, up to a cap of 25,000 ₪ per bill
- Cash withdrawal from a credit balance held with a supervised financial entity (including a financial service provider): is not considered the exchange of a bill for cash
Sanctions for violating the law
Anyone who violates the provisions of the law may be subject to significant sanctions:
Financial sanction (on a dealer) – graduated according to the amount of the violation:
Amount | Sanction rate |
Up to 25,000 ₪ | 15% |
25,001 – 50,000 ₪ | 20% |
Above 50,000 ₪ | 30% |
*It is important to note that in the case of a repeated violation within two years – the sanction will be doubled.
Based on our professional experience, one of the most common mistakes we see is reliance on outdated figures. Many business owners still believe that it is permitted to pay up to 11,000 ₪ in cash to a dealer – while the currently permitted amount is only 6,000₪. A violation of the law, even if made in good faith, may lead to significant financial sanctions. Any business that receives cash payments must ensure that its payment procedures are up to date and aligned with the law as it stands today.
What should you do now – practical takeaways
- Check the updated amounts – 6,000₪ for transactions with dealers, 15,000 ₪ between private individuals
- Update your team – anyone who handles payments in the business must be familiar with the updated rules
- Document payment methods – a dealer is required to document the payment method for every receipt and payment
- In real estate transactions – remember to include details of the payment method in the report to Real Estate Taxation
- Checks – make sure that the recipient’s name is stated whenever required by law
Nimrod Yaron & Co. specializes in Israeli and international taxation. Our team consists of professionals with years of experience at the Israel Tax Authority, together with experience at leading firms and law offices, bringing a combination of legal and economic perspectives. Our team of experts specializes in tax advisory services for business owners, representation before the Israel Tax Authority, and updating financial procedures in accordance with legal requirements. If you have any questions regarding the implementation of the Cash Law in your business, we will be happy to assist you.
FAQ
How much cash is it permitted to pay to a business in 2026?
In a transaction with a dealer (such as a store, contractor, or service provider), it is permitted to pay up to 6,000 ₪ in cash. In a transaction whose price exceeds this amount, up to 10% of the transaction price may be paid in cash, but no more than 6,000 ₪, and the balance must be paid by credit card, bank transfer, or check.
How much cash is it permitted to pay in a transaction between private individuals?
In a transaction between two private individuals, it is permitted to pay up to 15,000 ₪ in cash. Exception: in the purchase of a vehicle between private individuals, the amount remains 50,000 ₪.
Is it permitted to pay salary in cash?
Yes, but only up to a limited amount of 6,000 ₪. Above this amount, payment must be made by bank transfer, check, or credit card. This rule also applies to salary payments between family members.
What is the sanction for violating the Cash Law?
A dealer who violates the law may be subject to a financial sanction of 15% to 30% of the amount of the violation, depending on the amount. An intentional fraudulent act, such as splitting a transaction in order to circumvent the law, constitutes a criminal offense punishable by up to 3 years’ imprisonment.
Do the restrictions apply to payments between family members?
No. Cash payments between relatives are exempt from the restrictions of the law – except for salary payments, which are subject to the restrictions even between family members.
