Leaving Israel – whether for a short period or permanently – requires planning, not only on a personal level but also in terms of your rights and obligations vis-à-vis the state. To understand the situation, it’s important to know whether you are going abroad for a short period (between one and two years), and whether you intend to maintain your residency or sever it.
If you choose to go abroad without severing residency (up to about two years), you are still considered an Israeli resident for purposes of National Insurance and income tax. Your rights are preserved – including health services, child allowance, maternity benefits, disability and long-term care benefits, and continued accumulation of eligibility for the old-age pension. There are exceptional cases in which the period of recognized residency may be extended or shortened, but this must always be arranged properly with the relevant authorities.
What does this mean in practice?
You have reporting and payment obligations in Israel from the moment you leave the country. For income tax, anyone who earns income abroad must file an annual tax report and pay tax in Israel on all income earned in Israel and abroad, according to the principle of personal taxation. Regarding National Insurance – if a person is employed in a country that has a social security treaty with Israel, they may be exempt from paying National Insurance in Israel, subject to reporting and submitting documentation. If they are self-employed, unemployed, or living in a country without a treaty – they must pay National Insurance contributions independently. In practice, people use a certified tax advisor to report, pay, and fulfill all requirements, maintaining their rights and avoiding debts or penalties.
In cases where a person leaves the country and severs residency (a long-term stay abroad), meaning they live abroad for over two years and change their center of life, the National Insurance Institute considers them no longer a resident in terms of benefits, while the Tax Authority may still view them as a resident for tax purposes. It is essential to clarify your status and officially regulate it.
In such a case, the person loses ongoing benefits, is no longer insured under the National Insurance system, and is no longer entitled to allowances such as health services, child allowance, maternity benefits, disability, long-term care, or unemployment benefits.
Regarding the old-age pension – if the person moves to a country that has a treaty with Israel, they may retain their rights and receive the pension even without being a resident and while living abroad. It is possible to accumulate eligibility time in both Israel and the foreign country. If insurance contributions were paid for at least 10 years (combined in Israel and abroad), a partial old-age pension may be granted. If 35 years of insurance have been accumulated, a full pension may be possible – subject to the treaty conditions and the place of residence at the time of receiving the pension. On the other hand, if one moves to a country that has no treaty with Israel, they lose eligibility for the old-age pension – even if they paid contributions for many years – unless they return to Israel and meet all the eligibility conditions again.
Severing residency is a process that must be carried out in an orderly fashion, either independently or with the help of a tax advisor, with both the Tax Authority and the National Insurance Institute, in order to avoid unnecessary debts and to preserve rights wherever possible.
Before leaving, check your status, make sure to handle all reporting and payments, and consult a professional if needed. This will help ensure that you don’t find yourself in the future without coverage, without allowances – and with no way to fix it.
