Income for which insurance contributions must be paid


An employee’s income for which national and health insurance contributions must be paid is that income on which income tax must be paid, under Section 2(2) of the Income Tax Directive – in other words, the employee’s wages and all benefits paid to the employee, whether in cash form or its equivalent.

These benefits include, for example, meals for employees and discounts that the company grants its employees such as discounted airline tickets (that airlines give to their employees) and free transportation (that bus companies give to their employees).

If the income of one of your employees is equal to or less than the minimum income for the payment of insurance contributions, you will pay for that employee the same amount of contributions paid for employees whose income is the minimum. The minimum income for the payment of national and health insurance contributions is equal to the minimum wage, as specified in the Minimum Wage Law, 5747 – 1987.

  • The minimum wage per month for a full-time employee is NIS 5,300 (as of Apr 01, 2018).
  • The minimum wage per hour for an employee who is paid by the hour is NIS 28.49 (as of Apr 01, 2018).

The maximum income for the payment of insurance contributions is the “ceiling” of wages for which insurance contributions must be paid. That part of the worker’s wages which is less than or equal to the “ceiling” is subject to the payment of national and health insurance contributions, while that part of those wages which exceeds the “ceiling” is exempt.

The maximum income for the payment of insurance contributions for an employee is NIS 44,020 (as of Jan 01, 2020).