Does a dormant Israeli company still need to file annual compliance?

Yes. A dormant company — one that had no activity, no income, and no expenses during the year — is still legally required to file an annual report with the Registrar of Companies and submit a nil corporate tax return with the Israel Tax Authority. VAT registration may be suspended or cancelled for truly dormant companies, but this must be arranged formally. Simply not trading does not relieve a company of its compliance obligations.