Who is eligible for a grant from the Israeli tax authorities for 2011 and every year following 2011?
This is the first of a series of articles on the new law concerning this “tax grant”, but please note that the amounts have changed and are updated from 2011 (the differences are very small).
Note:
As with any other new law it is impossible at this stage to give any recommendation because we don’t know yet how the law is been implemented, therefore please understand that I will not have the answers to all your questions just yet.
Beginning in 2011 a new tax law applies to any employee, or even an (independent) self-employed worker, who had an income from a salary or a business during the 2011 tax year (starts on January 1st) and meets all the following conditions stipulated by the law:
- Age 23 and up and have children or 55 and above, even without children.
- During the tax year of 2011, beyond the residential apartment unit, you, your spouse or the “financially dependent” children you may have (living with you or not) did not own, together or separately, a right in land (such as an apartment, shop, parking, etc.), in Israel and / or abroad, if you own more than 50% of this property.
If there is one out of these two things:
• You have one or more children or you are above 55 years old, even without children:
– the result by dividing the total income (from labor, a business or occupation) in tax year of 2011 divided by the number of months your actually worked (as an employee or self-employed, but not more than 12 months) this year, is:
- higher than NIS *1,920
- lower than NIS *5,710
• You have one or more children or you are above 55 years old, even without children
– the result by dividing the total income (from labor, a business or occupation) in tax year of 2011 divided by the number of months your actually worked (as an employee or self-employed, but not more than 12 months) this year, is:
- higher than NIS *1,920
- lower than NIS *6,237
Employee – an individual resident of Israel who had an income from his work in year tax of 2011 but NOT if this income was paid by (the employee was working for one of these) family: spouse, brother, sister, parent, grandparents, offspring and descendants of the spouse, and his partner of any of these. The employee was working for a company that he or a relative had control over.
Income from work– Salary (excluding pensions) including as a household (“legal cleaner”), maternity allowance paid by the NII, benefits received from his employer such as payments granted to the worker to cover his expenses, including car allowance or telephone, tuition fees, travel expenses in Israel or abroad, the acquisition of professional literature or clothing, etc.
Self Employed– An individual (not a company), resident of Israel who had an income from a business and / or occupation in the tax year of 2011.
Child – Who was under the age of 19 years during the tax year of 2011.
What are the conditions to be entitled to this grant?
- To receive the grant for 2011 a claim must be filed (as described below). The claim can be submitted only from 1 January 2012 until the 30 September 2012.
- If you are self-employed or an employee obligated to submit a report to the IRS, (or that your partner must filing this report), you should file the annual report online up to – 31 May 2012.
- Your employer must submit the 126/856 the tax report online (for the tax year of 2011) until 30 April 2012.
How to file a claim for a grant – What you will need – Where to find the form
Submission of the claim is free!
To file a claim, you must go personally to one of the post office branches with your identity card and a copy of a check (from your personal account) or an official confirmation from your bank. Any amount you are entitled to, will be transferred to this account only.
Please note: the claim is personal and cannot be filed for someone else, not even showing identification of that person, power of attorney or any other document attesting to his right to representation.
When in the Post office, you must identify yourself to the postal clerk and provide him with the following information:
- ID Number of your or your spouse’s employers (including employers in household) in tax year of 2011
- If you have worked as an independent (self-employed) in the tax year 2011
- Mailing address
- Bank account information where the grant will be transferred to
After filling out all your information, the mail clerk will print out all the details on the claim form.
The bottom part of the form, serves as a declaration containing all the relevant data required to receive the grant as well as your personal data.
In this section, the post office clerk will ask you to sign to confirm the correctness of your personal data – the information you gave to meet the conditions to be eligibile for the grant.
A word of wisdom:
Are you looking for privacy? Not here! Forget it because not only the clerk in the mail will now know “all about your finances” but every other person nearby waiting in line. Please! Ask for a copy of the form before you leave the post office.
The claim number will be printed out on the form and will be used for identification and is essential for the delivery of any information you may ask in the future concerning the claim.
To find information about your claim, AFTER filing the form you just received in the post office (or maybe was lucky to find it online in the Tax Authority’s site) you can call the “call center” at this number 4954 * (asterisk taxes), 1-222-4954 or 02-5656400.
A Warning:
If you provide any false information when filling a claim for a grant affecting the eligibility of a grant, be aware that this is a criminal offense, punishable by up to one year in prison. In addition, you will not be eligible for a grant for this same year or for the two next years.
