National Insurance Contributions

The information taken into account for the purposes of determining a person's insurance status is as follows:

In determining the income basis in accordance with which the insured will pay insurance contributions, the National Insurance Institute relies on Section 2 of the Income Tax Ordinance, which defines sources of income. There are 3 types of income which require the payment of insurance contributions:
 Income from (salaried) work.
 Income from a (self-employed) business or occupation.
 Income not from work.

In accordance with the status of the insured, the following will be determined:

1.       Who must pay insurance contributions for the insured: his employer (in the case of a salaried worker), the insured himself (in the case of a self-employed worker), the payer of pension for the insured (in the case of a pensioner) or the Defense Ministry (in the case of military service).

2.       For which branches of insurance in the National Insurance Institute is the insured covered, that is, for which branches of insurance will he need to pay, and accordingly, which benefits will he be eligible to receive.

3.       Which income is taken into account for the calculation of insurance payments of the insured (called: the basis for payment of insurance contributions).

     A housewife – a woman who is married to an insured person and who does not work outside her home.

   A soldier in regular military service – who is not a salaried or self-employed worker.

     A person who has no income from work or from other sources, or whose income from other sources is not higher than 5% of the average wage (NIS 431 (as of 01.01.2012) ), and who is one of the following:

      A prisoner or detainee who resides in a prison/detention facility – for a period of 12 months.

      A new immigrant – for a period of 12 months from the day of his immigration to Israel.

      A person who is at least 18 years old and who enlists in the army or national service before age 21 – is exempt from payment of insurance contributions from age 18 for a period of 12 months at the most, not necessarily consecutively.

     A person who is at least 18 years old and who studies in a secondary education institution (up to grade 12) or in a vocational course or in a pre-military framework ("mechina") or volunteers for a year of service for a national public goal and who enlists in the army or national/service before age 21 is exempt from payment of insurance contributions for the duration of his studies or volunteer service, and for an additional period of 12 months at the most, not necessarily consecutively, from the completion of his studies.

      Note that this exemption applies only between the ages of 18 to 21, and no later. The exemption is not from the day of discharge from the army.

      A person of at least 18 years of age who did not enlist in the army or who enlisted after age 21, and he is studying in a post-elementary educational institution (grade 10 through 12) – is exempt from payment of insurance contributions from the period of his studies, up to age 19 at most.

 

The reference is to the average wage according to the National Insurance Law. It is calculated according to a method determined in the Law, on January 1st of every year, and afterwards each time that a compensation is paid.

High-school student: if you reached your 18^th bitrhday and are still in higj school (up to grade 12, not higher), you are exempt from payment of national and health insurance  contributions during the course of your studies, as well as for an additional period of 12 months at the most, not necessarily consecutively, before your enlistmant on condition that you don't work, have no income, and enlist in the army before age 21.