Tax rights in Israel
Parents of children up to age 4 are entitled to income tax credits (Nekoudate Zikouye)
The right is only granted to one of the two parents: if the parents are married, the right is granted to the father.
If the parents are divorced or separated, the right is granted to the non-custodial parent.
In the case of a single parent (when the second parent is deceased or unknown), this person will receive the entitlement.
The tax advantage is granted as follows:
- During the tax year in which the child is born, 1 tax credit point will be granted.
- For the following two years, 2 credit points will be granted each year.
- During the fourth year (when the child is 3 years old), 1 point will be awarded.
Who can benefit?
An Israeli resident who has income tax deducted at source from his salary, and who has a child under the age of 4.
Obtaining tax rights in Israel
- To obtain this right, form 101 must be completed and forwarded to the employer before the end of the fiscal year. (end of December each year).
- A photocopy of the appendix to the identity card must be attached. (Teudate Zeoute Sefah).
- If the tax year has passed, the employee can apply to the tax authorities for a tax refund. Refunds can be obtained up to 7 years in the past.
See the video Le tax owes you money:
Important to know
All credit points are granted only to employees who are Israeli residents. They are in addition to the 2.25 credit points granted to them for being Israeli residents.
The value of a credit point for the year 2020 is 2628 Shekels / year.