Labor Law in Israel


According to national insurance requirements and income tax legal entities that are defined as a “fixed presence” which employs workers in Israel is obliged to prepare monthly reports to the income tax and to national insurance authorities.

Special issues and emphases:

  • Calculation of foreign workers’ salaries is carried out in accordance with the law, together with monthly reporting to the tax authorities.
  •  National Insurance is calculated and paid in accordance with the double national insurance prevention treaty. In certain cases after meeting a number of criteria, it is possible to obtain full exemption from payment of National Insurance in Israel.
  •  Income tax deductions is carried out in accordance with tax brackets for individuals and in accordance with special tax benefits for foreign workers.
  • The procedure of obtaining a work permit in Israel is carried out via a number of government ministries, including the Ministries of Interior and Industry.
  • Obtaining approval for “experts” in Israel enables the granting of a number of tax benefits both for employee and the company.
  • Nevertheless, we strongly recommend to use local accountants in preparation monthly reports regarding employees’ payroll, allowances for national insurance and income taxation. Feel free to contact our experts in order to get consulting services in Israel.