Tax Refunds for Employees
Most salaried employees in Israel pay income tax through withholding on their payslip, based on a monthly estimate. When details are not updated with the employer or gaps open up during the year - you paid more than you owed, and the difference can be claimed back, up to 6 years retroactively, with interest and indexation.
Who is usually eligible?
Eligibility always depends on individual data, but experience shows that most refunds come from the same recurring reasons:
Family changes
Marriage, a birth, divorce, single parenthood or a child with special needs that were not updated on Form 101 with the employer.
Work and salary
Two or more employers without tax coordination, changing jobs, layoffs, furlough, unemployment or part-year work.
Pension and insurance
Independent deposits to a provident fund or insurance that did not go through the payslip and received no credit during the year.
Donations
Donations to institutions recognized under Section 46 of the Income Tax Ordinance, entitling a 35% credit, subject to the law's conditions and caps.
Studies and Aliyah
Credit points for an academic degree or professional studies, and credit points for new immigrants in the first years after Aliyah.
Residence and reserves
Living in a local authority that grants a tax benefit, a credit for reserve-duty combatants, and points for discharged soldiers and national-service graduates.
How does it work with me?
A short intake chat
Send a WhatsApp message describing the situation in a few words: workplaces, family changes, unemployment periods and so on.
Collecting basic documents
In most cases, Form 106 from every workplace, certificates for pension deposits and donations, and a bank account confirmation are enough. An exact checklist is sent to you.
Computational review
I calculate the statutory tax versus the tax actually withheld, for each of up to the last 6 years, and estimate the expected refund.
Filing the request with the Tax Authority
If eligibility is found - an online refund request (or Form 135) is filed for each tax year separately, with all supporting documents.
Follow-up until the money arrives
Tracking the request with the Income Tax Authority, answering completion demands, until the refund with interest and indexation lands in your bank account.
Frequently asked questions on the subject: Q&A on tax refunds for employees