General Disability Pension recipients who have no other income or for whom the degree of incapacity has been established to be at least 75% (for one year or more) are exempt from paying National Insurance contributions as long as they are eligible to receive the pension.
Who is Eligible?
- General Disability Pension recipients for whom at least 75% incapacity to earn a living has been established permanently or for a temporary period of one year or more, are entitled to an exemption from National Insurance fees even if they have other income. Nonetheless:
- Those who are self-employed must pay work injury insurance.
- The employer of those who are salaried employees must pay work injury insurance and workers’ rights in bankruptcies and corporate liquidation insurance for them.
- One who receives a general disability pension at a rate lower than 75% or for less than a year is eligible for an exemption in any of the following cases:
- He/she has no income from employment or from any other sources
- He/she has income from other sources but that income does not exceed more than 5% of the average salary (as of 2017, no more than 484 NIS).
- The exemption is only given if the disability pension is actually paid to that person. A person who is eligible for the pension but decides it is more beneficial to forfeit it, for example someone who is eligible for 2 different pensions and has to choose between them and prefers the other (and the other pension does not grant him/her an exemption from National Insurance contributions), he/she is not eligible;e for the National Insurance contribution exemption on other sources of income.
- National Insurance Appeal 21494-06-14 Amos Talmi v. the National Insurance Institute on the Nevo website.