Israel Tax Agency Issues Decision on Tax Treatment of Pension Funds

The Israeli Tax Authority Nov. 7 issued a decision clarifying the tax treatment of pension funds and voluntary deposits. The clarification explains that: 1) deposits are treated as income to the employee; 2) the employer can’t use the fund to cover expenses or deductions; 3) the fund is only accessible to employees upon retirement or severance; and 4) when the fund is distributed to the employee as an annuity it’s considered taxable income. [Israel, Israel Tax Authority, 11/07/18]

Reference:
View Index. View Decision No. 8845/18.