Tax Refunds for Employees
As is well known, tax refunds for employees are possible under Israeli tax laws. Most salaried employees in Israel, whose annual income is below a certain threshold and who are not controlling shareholders in companies, are exempt from submitting an annual tax report. However, in some cases, it may be beneficial for an employee to proactively contact the Tax Authority and submit a request for a tax refund.
Employees pay income tax through their employer on a monthly basis, with amounts specified on their payslip, based on annual calculations. If an employee worked only part of the year, worked in multiple jobs with irregular monthly income, or was entitled to tax credits that were not applied in payroll calculations—for example, credits for holding an academic degree, having dependents with disabilities, or having multiple children, or if the employee was not granted a tax reduction for living in designated areas eligible for a regional tax discount—there is a high likelihood that excess tax was withheld. As a result, the employee may be eligible for a refund.
In addition to these situations, under the provisions of the Israeli Income Tax Ordinance, there are other cases where employees are entitled to tax benefits that reduce their tax liability. These benefits may be granted either through deductions or credits based on percentages defined by law, or through tax credit points, each of which has a specified monetary value determined by the tax authorities.
Our tax department at Michael Weizman & Co. – Certified Public Accountants possesses the expertise and knowledge required to assess eligibility for tax refunds for employees, both for the current year and for previous years that have not yet expired. We assist in preparing and submitting refund requests to the Tax Authority until the full refund is credited to the client’s bank account.
For more information available on our website, see the article we published on this topic, detailing the various ways and entitlements to maximize tax refunds. The article consolidates the relevant issues for checking employee refund eligibility. For your convenience, here is the link to the article – Tax Refunds for Employees.
An accountant from our firm will be happy to assist you with this service. Contact us today for a no-obligation consultation.
