Coordination of insurance contributions

 Under the National Insurance Law, if a worker is employed by several employers or if a person receives early pension from several sources, the secondary employer or pension payer deducts national and health insurance contributions from his income or pension at the full rate. In some cases, the amount of insurance contributions deducted is higher than that required by law.

In order to prevent over-deduction of insurance contributions, workers employed by several employers and persons receiving early pension from several sources should provide their secondary employer or pension payer with an authorization of the correct deduction rate.

A worker or early pension recipient from whose income or pension an amount has been deducted which is greater than the required one is entitled to a refund of insurance contributions.

The following may coordinate their insurance contributions:
      A person working for two employers or more
      An early pension recipient who also works as an employee for one employer or more
     A person receiving an early pension from two or more sources

On condition that they meet one of the following conditions: 
     Their monthly income from their main employer or primary pension source is below 60% of the average wage, that is, below NIS 5,171 (as of 01.01.2012) .
  Their total monthly income from all employers and/or pension sources is higher than the maximum income liable for the payment of insurance contributions: NIS 41,850 (as of 01.01.2012) .

The amount of maximum income on which insurance contributions are paid. Insurance contributions are not paid on any income that is above this maximum. The maximum is updated every year in accordance with the rate of the rise in the Consumer Price Index.

The employer through whom his worker declared, in form 101, that he earns his "monthly salary".

The employer through whom his worker declared, in form 101, that he earns an "additional salary.