Manage Payroll Tax in Israel

Taxes in Israel

Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Israel.

Note that residents and nonresidents pay different tax rates, and that contributions to National Insurance and other programs may increase for higher incomes. Nonresidents do not receive all advantages of contributions to the National Insurance program.

Employer

3.55-7.6 %

National Insurance contribution

6.54 %

Pension

8.38 %

Severance fund

7.5 %

Study Fund

Employee payroll taxes

0.4-7.0 %

National Insurance for residents

0.04-0.87 %

National Insurance for nonresidents

min ILS 225 - max ILS 255 %

Mandatory Travel Allowance

1 %

Disability Insurance mandatory for Remote customer employees

3.1-5.0 %

Health Levy

6 %

Pension

2.5 %

Study Fund

Employee income taxes

10% (Up to 75,960 ILS)

14% (75,961-108,960 ILS)

20% (108,961-174,960 ILS)

31% (174,961-243,120 ILS)

35% (243,121-505,920 ILS)

47% (505,921-651,600 ILS)

50% (Over 651,600 ILS)

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Taxes in Israel