The ordinary marginal income tax rates on earned income for tax year 2020, per individual, are as follows:
The rates depend on various factors, such as whether the individual is: over age 60, a 10% shareholder or more, different rental income tax tracks, etc.
Credits for Tax Year 2020
A tax credit is a direct decrease of the calculated tax liability.
3 credit points for end 18 months from date of Aliyah.
2 credit points for the next 12 months.
1 credit point for the next 12 months.
National Insurance (Social Security] including Basic Health Insurance
Current rates of National Insurance for employees, including health insurance and Bituach Leumi contributions (as of Jan 2020, in NIS)
Employment in Israel-Salary Package:
Below is a list of salary package an employee is entitled to get from his employee:
A corporation is deemed to be subject to Israeli taxes if its activities are managed and controlled within the State of Israel or established under its laws. A domestic corporation is subject to taxation on its worldwide income. A foreign corporation with an Israeli subsidiary is only taxed on Israel based income.
In 2020, the corporate rate was reduced to 23%. Dividends from the company to an individual are taxed at rates ranging from 25% to 33%.
Value-Added Tax (VAT) in Israel, is applied to most goods and services, including imported goods and services. As of 1 October 2015, the standard was lowered to 17%, from 18%. Certain items are zero-rated which includes exported goods and the provision of certain services to non-residents.
We will be happy to give more details on the issues listed above.
Certified Public Accountants