Keren Hishtalmut remains the single best tax-advantaged investment instrument in Israel, offering full exemption from Capital Gains Tax after 6 years.

1. Keren Hishtalmut for Self-Employed: Double Benefit

Self-employed individuals (*Atzmaim*) enjoy a double benefit: depositing up to 19,920 ILS annually for recognized business expense deduction, and up to 20,520 ILS total for 100% tax-free capital gains upon withdrawal after 6 years.

2. Provident Fund for Investment (Amendment 190 & Regular Provident Funds)

Under Kupat Gemel Le-Haskaa, individuals can invest up to 79,005 ILS annually per family member. At age 60, funds can be withdrawn as a tax-free annuity, or subject to a reduced 15% real capital tax under Amendment 190 rules (instead of standard 25%).

3. Updated 2026 Contribution Ceilings

  • Self-Employed Tax Deduction Cap: 4.5% of net profit up to 19,920 ILS.
  • Self-Employed Capital Gains Exemption Cap: 20,520 ILS per tax year.
  • Employee Salary Cap: Up to 15,712 ILS monthly salary (7.5% employer, 2.5% employee).

Pro Tip: Don't Wait Until December!

Ensure your deposits are processed well before December 31st to secure tax breaks for the current tax year.

At Bernstein & Co., we maximize your recognized expense write-offs in Keren Hishtalmut.

Annual contribution limit of 20,520 โ‚ช and capital gains tax exemption ceiling up to 293,397 โ‚ช.