Calculate the extra Israeli tax credit points and monetary savings available to new immigrants (olim chadashim) in Israel. New olim receive 3.5 extra credit points in the first 3.5 years, worth up to 9,870 ILS per year.
Enter your annual Israeli salary and years since aliyah to calculate the extra tax credit points you receive as a new immigrant and their monetary value.
Extra tax credit this year (oleh bonus)
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Extra credit points
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Oleh bonus value (ILS)
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Exemption years remaining
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Total annual credit (standard + bonus)
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Your breakdown
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How the oleh chadash tax credit bonus works
Israel uses a system of tax credit points (nequdot zikui) to reduce income tax liability. In 2025, each point is worth 235 ILS per month, or 2,820 ILS per year. Every Israeli resident is entitled to 2.25 standard credit points. New immigrants receive an additional 3.5 credit points during their first 3.5 years in the country. The 3.5 extra points translate to 9,870 ILS per year in reduced income tax. This reduction is applied directly against the income tax computed on Israeli salary before any payment is made. If the total credits exceed the income tax owed (common at lower salary levels), the excess is not refunded but the tax liability reduces to zero.
Worked example: 180,000 ILS salary, year 1 of aliyah
Standard resident credit: 2.25 points times 2,820 ILS equals 6,345 ILS. Oleh bonus: 3.5 points times 2,820 ILS equals 9,870 ILS. Total annual credit: 16,215 ILS. Income tax before credits on 180,000 ILS gross (adjusted for social deductions) is approximately 25,000 to 30,000 ILS. After applying the full 16,215 ILS credit, the effective income tax drops significantly, resulting in substantially higher take-home pay compared to a veteran Israeli employee earning the same salary. The bonus is most valuable in the first 3.5 years and tapers off completely after that.
Other oleh financial benefits this calculator does not cover
This tool covers only the income tax credit point bonus. New immigrants in Israel also benefit from: the 10-year foreign income tax exemption (see the Expat Tax calculator), reduced customs duties on imported household goods and a personal car, first-time buyer purchase tax exemption (mas rechisha at 0% up to approximately 1.9 million ILS in 2025), sal klita absorption cash grants from the Jewish Agency, and reduced municipal property tax (arnona) in many cities for the first few years of residence. The financial package is substantial and worth modelling carefully before and after aliyah with a licensed Israeli accountant (roeh heshbon).
Frequently asked questions
How many extra tax credit points do new immigrants get in Israel?
New immigrants (olim chadashim) receive 3.5 additional tax credit points per year for the first 3.5 years after making aliyah. In 2025, each credit point is worth 2,820 ILS per year (235 ILS per month). The 3.5 extra points are therefore worth 9,870 ILS per year in additional tax reduction. This is on top of the standard 2.25 credit points that all Israeli residents receive. After 3.5 years, the oleh bonus credit expires and only the standard resident credit applies.
Do the oleh credit points overlap with the 10-year foreign income exemption?
Yes. The 3.5 extra credit points and the 10-year foreign income exemption are separate benefits that can be used simultaneously in the first 3.5 years. The credit points reduce tax owed on Israeli-source income, while the exemption prevents foreign income from being taxable at all. During the first 3.5 years, a new immigrant working for an Israeli employer can benefit from both: lower Israeli income tax due to the extra credit points and no Israeli tax on their foreign investment portfolio.
Are the oleh credit points applied automatically or must they be claimed?
The extra credit points are generally applied automatically by the employer once the employee presents their oleh certificate (teudat oleh) to the employer or the Israeli Tax Authority. Employers use the credit point table to reduce monthly withholding. If the credits are not applied during the year, the new immigrant can claim them in their annual Israeli tax return (Form 1301) and receive a refund. It is advisable to present the teudat oleh to the employer on the first working day to avoid overpayment.
What other financial benefits do new immigrants receive in Israel beyond tax credits?
Beyond the 3.5 extra credit points and 10-year foreign income exemption, olim receive: a one-time absorption basket (sal klita) cash payment from the Jewish Agency, reduced customs duties on imported goods for the first 3 years, a first-time buyer purchase tax exemption on property (mas rechisha), access to mortgage assistance programs through the Ministry of Housing, and priority access to certain government benefits. Many municipalities also offer property tax (arnona) discounts for the first few years. The package is designed to ease financial integration during the absorption period.