Severance

Israeli law entitles employees to severance pay (פיצויי פיטורים) equal to one month's salary per year of employment. Learn about the tax treatment of severance — including the tax-exempt amount (currently over 12,000 NIS per year of service), options for spreading the tax over multiple years, and how to handle severance accumulated in pension funds.

  1. Tax exemption for severance pay

    Tax exemption for severance pay

  2. Calculation of severance pay

    How to calculate severance pay

  3. Section 14 - Compensation at the cash register

    General approval for pension fund compensation

  4. Distribution of tax on compensation

    Distribution of tax on severance pay

  5. Severance pay

    Entitlement to severance pay