Tax Treatment
A 13th salary (sachar 13) is a common benefit in Israeli companies, typically paid in September (before the Jewish holidays). It is fully taxable as regular employment income. The employer withholds tax using the annual cumulative calculation method, so the withholding is based on the employee's annual effective rate rather than a higher monthly marginal rate.
Practical Note
The 13th salary is not required by law but is often part of collective or individual employment agreements. It is subject to all deductions: income tax, NI, pension, and training fund contributions.
בסיס חוקי
- Section 2(2) – Employment income
Important Note: The information on this website is for general informational purposes only and does not constitute professional tax advice. Consult a qualified tax advisor before making financial decisions.