By Yaakov Ehrenkranz
According to recent research carried out by PolicyCheck in Israel, approximately 47% of pension policies have errors. Whereas some of the 80 different types of mistakes are minor, they calculated that the average loss per person is no less than NIS 50,000 (often the older the policy the greater the impact of the error). Research in the UK came to a similar conclusion, perhaps showing it’s not linked to country or policy, and the mistakes are not limited to pension accounts. So why don’t we all check our financial documents? Maybe we trust that our employers and the professional organizations won’t make mistakes, or maybe it’s due to some kind of laziness. But whatever the reason, it’s to your financial benefit to check your documents. The corona pandemic has made this even more important, as discussed below. Here are some tips to help you make sure that you are receiving all that is due to you.
About a year ago I wrote an article detailing and explaining some of the different elements of your payslip (https://labinsky.com/understanding-your-tlush). Make sure your tlush reflects the agreement you have with your employer. Everything from pension contributions and pitzuim to sick and vacation days should be done in accordance with the relevant labor laws as well as your personal compensation package. Also, make sure you have updated your employer with a new kartis oved (form 101) if there have been changes in your family situation in order to ensure the proper amount of tax is being deducted. If you receive wages from more than one employer, make sure to do a te’um mas to instruct each employer/payroll company how to calculate taxes appropriately. Regardless of how long you have been working for your employer and how much you trust them, it is worth checking to make sure there are no mistakes.
Once you make sure your tlush looks good, it is a good idea to occasionally confirm all the payments your employer recorded on your payslip were actually deposited into your savings funds (keren pensia/ bituach menhalim/ kupat gemel, keren hishtalmut). All your information is available online at your pension company’s website or on quarterly/annual statements that you should receive in an email or regular mail.
Salaried and self-employed workers in Israel are entitled to a maternity/paternity allowance. If you stopped working after giving birth and previously were paying bituach leumi contributions for a qualifying period, you are eligible to receive either 15 weeks of pay (the full allowance) or 8 weeks (partial allowance). Paternity allowance is also available in some situations. Either way, it is important to check the letters from bituach leumi explaining the calculations (you will generally get them in the mail but can often see them online sooner) to make sure they have accurate and complete information about your income.
If your employment situation during pregnancy had any complicating factors- if you work for more than one employer, had any changes in your employment during the month preceding the birth, or, as has unfortunately been common recently, were on unpaid leave (chalat)– it is even more important to make sure bituach leumi has all of the correct information and calculated the allowance correctly.
During the Covid-19 pandemic some of the rules have been adjusted to ensure that the benefit is not impacted negatively by certain changes in employment before giving birth. They are published clearly online, but mistakes do happen – especially if you had any of the aforementioned situations (or others) during pregnancy. While the process might take a little persistence and patience, sometimes with a phone call, internet inquiry, or perhaps visit to a bituach leumi branch you can correct your information and get what you are entitled to, which can be thousands of shekels more in some cases. Check out the bituach leumi website for more information https://www.btl.gov.il/ on what you should be getting.
In Israel, unemployment benefits are paid by bituach leumi to salaried workers who are currently not working and would like to be. Generally, one is required to report to employment services and be actively seeking employment, but due to coronavirus there have been many adjustments to the rules to allow for easy processing as well as expanded and extended eligibility for these benefits. How much you are entitled to depends on your situation.
It really pays to read the letters from bituach leumi (generally available online in your personal portal, where you can also communicate with them and upload documents via secure messages) to make sure that they have all of your information and are calculating correctly. If a tlush is missing, the rate they pay you will be reduced and your monthly avtala payment will be less than it should. You should also make sure that bituach leumi has your correct bank information as well as the correct dates for when your unemployed (or underemployed) period starts and finishes.
Governments have been trying to support the world economy with various financial aid and stimulus, some – perhaps most notably for our readers, the US and Israel – have made payments directly to citizens. While most payments are made automatically and correctly, errors do happen, especially if you have had changes in your family that the relevant authorities don’t know about yet, or, in the case of the US, if you haven’t filed taxes for recent years. Make sure you are aware of everything being offered, and that the relevant government office has accurate and complete information (bank details, address, number of dependents, etc). Check their respective websites to see the status of your payment if you have not received what you think you should.
Workers in Israel who meet certain income and age/family criteria are entitled to a work grant, or maanak avoda, which can be several thousand shekels. Before the chagim the Israeli government gave an additional grant to those who qualified based on their 2019 income. You can check your eligibility (each spouse separately) online at https://www.misim.gov.il/gmmhszakaut/BdikatZakaut.aspx, and apply by 30/11/20.
There are more things to check as well – for example, your water bill should show the correct amount of people living in your home, as the impacts the rate you pay for your usage. With so many people reeling from the financial impact of the coronavirus it is more crucial than ever that you ‘check what you get’ to make sure you aren’t being shortchanged. In theory it’s all yours – just check that it actually is.
Yaakov Ehrenkranz is a Senior Associate at Labinsky Financial. He helps new and veteran olim adjust to the financial reality in Israel, and offers advice to achieve financial stability and success for individuals, families and small businesses. Yaakov can be reached at email@example.com