Israel

Employment taxes

• Israel taxes residents on their worldwide income, while non-residents are taxed only on income earned in Israel.
• Income tax is progressive: rates roughly range from 10% up to 50%, depending on income level, family status, deductions, etc.
• On top of income tax, employees must contribute to National Insurance (Bituach Leumi) which covers benefits, disability, healthcare, etc.
• Employer also pays contributions (social, insurance) which affect your total cost-to-company (but not deducted from your take-home).

Leave policy

• Annual leave: Starting with 12 paid vacation days per year for the first 4 years, increasing with seniority up to 24 days later on.
• Public holidays: Israel has 9 paid national/public holidays.
• Sick Leave: Employees accrue about 1.5 days of sick leave per month, up to a limit (often 90 days). Typically first day is unpaid, days 2–3 are paid at 50%, and from day 4 onwards full pay.
• Maternity leave: Mothers are entitled to 26 weeks of maternity leave of which 15 weeks are paid by the National National Insurance Institute (BTL). The rate is determined according to the employee's gross salary based on which National Insurance payments are made, up to the maximum amount of ILS 1,485.83 per day.
• Paternity leave: Fathers are entitled to 1 month of fully paid paternity leave if the mother is back to work. This pay is covered by the Social Security.
• Parental leave: No law covers parental leave.

Employment termination

• In Israel, there is no at-will termination, the employer must follow due process.
• Before termination, the employee must be given a hearing (opportunity to respond), a written invitation, and a chance to explain.
• Notice periods depend on tenure: during the first 6 months a day per month of work, after first year a 30-day notice is common.
• Severance (for those employed for more than a year) is generally one month’s pay for the years of service.

Hiring and contracts

• Contracts should be written and specify key terms (salary, benefits, termination, etc.)
• Contracts must be in Hebrew or English and can be bilingual.
• Probation period: 3-6 months.

Payroll and salary payments

• Payroll is processed monthly
• The minimum wage in Israel: roughly NIS 6,247.67 per month or NIS 34.32 per hour.
• Employers withhold income tax and social security contributions before you get paid

Benefits

Mandatory:

• National Insurance (Bituach Leumi) - covers health insurance portion, disability, old-age, etc.
• Pension/severance contributions - many employers set up pension/severance funds.
• Health insurance is partly public (via government system)

Optional:

• Private health insurance plans
• Life insurance, disability insurance
• Stock options/equity (especially in startups)
• Wellness, transportation subsidies, meals, etc.

Monthly living cost (Tel Aviv Edition)

Israel is not cheap, especially in cities like Tel Aviv. For a modest but comfortable lifestyle, plan for tens of thousands of shekels per month:

• Rent (1-bedroom in central area): NIS 5,000-7,000 (USD 1,400–2,000)
• Utilities (electricity, water, gas): NIS 800-1,000
• Internet/phone: NIS 150-200
• Groceries, food, daily expenses: NIS 1,500-2,000+
• Transport (public): NIS 200-400
• Dining out/entertainment: 500-1,000+ depending on habits

How to get a local ID number (Teudat Zehut)

• Once you become a legal resident or employee in Israel, you’ll be assigned a Teudat Zehut (identity number/national ID)
• For non-residents (e.g. remote workers), you may register with the Ministry of Interior or authority depending on visa/residency status
• The local employer often assists in registering you and obtaining the ID number.

Social security registration

• You (and your employer) must register with Bituach Leumi (National Insurance Institute)
• Contributions are deducted and remitted by the employer, based on income brackets, up to caps.

Banking

• Popular banks: Bank Leumi, Bank Hapoalim, Mizrahi-Tefahot, among others
• Opening an Israeli bank account is standard for payroll deposit
• You’ll need identification (passport, ID number), proof of residence, etc.
• You may need to handle exchange and international transfers if you maintain foreign accounts.

Housing and rental process

• A 12-month lease is very common, renewal is standard.
• Usually, you pay first month, last month, and a security deposit.
• Landlords often expect proof of income, a guarantor (especially for foreigners).
• Tenant rights: you can’t be evicted arbitrarily, you have protections on maintenance, and must get notices
• Some additional costs: municipal tax (Arnona), “vaad bayit” (building maintenance).

Healthcare system

• Israel has a universal health insurance system via health funds (Kupot Holim).
• As a resident or employee contributing via Bituach Leumi, you are eligible to join one of the health funds.
• For more choice or faster service, many people also carry private health insurance.
• Hospitals, clinics, and specialists are generally high quality.

Driving and public transport

• You can use an international driving license short-term, for long term, convert to an Israeli license.
• Public transport includes buses, light rail (in some cities), trains, fairly efficient between major cities.
• Within cities, buses, shared rides are common.
• Traffic, parking in cities can be challenging.

Emergency and important contacts

• Police: 100
• Fire: 101
• Ambulance: 102

Work permit and visa requirements

• Foreign nationals generally need a work visa/permit (often B/1 visa) applied by employer to Israel’s Ministry of Interior.
• The permit is often for 1 year initially, renewable up to 3 years (or up to 5 in special cases)
• Some special visas for entrepreneurs, researchers, high-tech talent, etc.
• Visa cost example: NIS 9,675 plus fees (for certain work visas).

Business culture and work norms

• Very direct & informal communication style, people say what they think.
• Hierarchies tend to be flat, you’ll often deal directly with senior leaders.
• Initiative is highly valued - if you see a problem, propose a solution.
• Speed and agility matter, companies move fast.
• Networking and personal relationships are important.
• Israelis often mix work and social life (cafés, after-work gatherings).