Taxation of employment income – part 1 – Tax at source
Over the next few posts, we will cover many aspects pertaining to employment income – relating to the obligations of both employer and employee, with specific focus on employee rights and taxation.
It should be noted that only credits enumerated on the 101 and those directly related to payroll ( e.g. Pension, life insurance etc. if applicable) can be given by the employer. Anything else will need to be claimed via a tax return (the prime example is donations – see here for more).
Employers are also required to deduct Bituach Leumi at source. The lower rates of Bituach Leumi will be given in the main employment; all other employments will have the full rate deducted unless a “Teum Bituach Leumi” is done – but that’s for another time.