One of the ramifications of the Israel-Hamas war is the growing interest of diaspora Jews and expat Israelis in immigrating to Israel. The National Insurance Institute and various government ministries grant a spectrum of rights and benefits to new immigrants and to returning Israelis, and it is worthwhile to become familiar with them in advance in order to minimize worries about social security rights, medical care, and financial assistance.
Residency – The ‘Center of Life’ Test
The key factor for full social security coverage is being a resident of Israel, meaning the individual’s center of life is, in fact, in Israel. The center of life test is both an objective test (the actions the person has taken to anchor his center of life in Israel) and a subjective test (the person’s country of choice for his center of life).
Israeli citizens receive social and economic benefits based on their residency status. The National Insurance Institute determines this status, based, inter alia, on the center of life test. In other words, merely moving to Israel does not automatically confer rights. The person must prove to the authorities that he has actually transferred his center of life to Israel and has severed the majority of his foreign connections, mainly livelihood and holdings.
Returning Resident
Who is defined as a returning resident?
“Returning resident” is a status defined by the National Insurance Institute and applies only to an Israeli citizen who severed residency prior to moving abroad or who became an expat due to his many years of foreign residency. Conversely, any Israeli who leaves Israel for a brief period without severing residency and then returns to Israel will remain a resident. He will continue to receive all the benefits of a resident reserved for him, as well as maintain the obligation to pay national insurance contributions for the entire period of his stay abroad.
How do you obtain the status of returning resident?
You may already begin arranging returning resident status while still abroad. Any Israeli who has not been a resident of Israel for more than five years may apply for an expedited track by contacting the National Insurance Institute or through the NII website.
What documents must be presented in order to obtain returning resident status?
The National Insurance Institute requires documents attesting to the actions taken by the person to sever his center of life abroad.
Such documents may include documentation of asset sales, termination of insurance policies, termination of employment, waiver of foreign citizenship, a signed apartment lease contract in Israel, a signed employment contract in Israel, registration of children to schools in Israel, etc.
Are returning residents required to complete a qualifying period for medical insurance coverage?
Yes. Expat Israelis who severed their residency ties with Israeli insurance, or who did not pay insurance contributions for a particular time frame, must complete a qualifying period for medical insurance coverage upon their return to Israel. The qualifying period is redeemable for a cash payment and its maximum duration is six months.
What rights does a returning resident receive?
Returning residents are entitled to the same benefits as Israeli residents (children benefits, old-age pension, disability benefits, etc.). Additionally, the Ministry of Immigrant Absorption and other ministries provide financial assistance to returning residents for 24 months.
The period of living abroad as a non-resident will not be counted as part of the required qualifying period for the entitlement to certain benefits, such as old-age pension. There are exemptions from qualifying periods, under special circumstances.
Assistance Program for Returning Residents
The assistance program for returning residents covers all spheres of life and includes a long list of benefits and concessions:
- Absorption basket (financial assistance).
- Taxation: exemption from paying taxes on vehicle and equipment purchases, tax credits, and benefits for particular types of taxation.
- Housing: assistance with housing expenses, mortgage assistance, and discounts on property and municipal taxes.
- Healthcare: special health insurance relating to the requisite qualifying period.
- Education and studies: special knowledge reinforcement programs offering courses in the Hebrew language and in other subjects, concessions in matriculation exams, concessions in admissions criteria to higher education, and scholarships and financial assistance to fund dormitory residence.
- Employment: training and employment programs, assistance with professional licensing, and payments of income supplements.
- Senior citizens: any returning resident who has accumulated the qualifying period required by law for an old-age pension (144 months) is entitled to receive it. Otherwise, he will receive a special old-age pension.
New Immigrants
New immigrants (olim) are entitled to all of the same allowances as Israeli residents and returning residents. New immigrants are also entitled to unique benefits, an “absorption basket” (financial assistance), and the same list of benefits as specified above for returning residents.
Who is defined as a new immigrant?
Anyone who is entitled to enter Israel pursuant to the Law of Return.
How do you start an immigration process?
You can contact the Ministry of Immigrant Absorption, which is the ministry that coordinates with all other relevant government ministries.
Can a person begin the immigration process while already residing in Israel?
Yes, through the Ministry of Immigrant Absorption.
Is there a qualifying period in order to receive a child allowance?
No. Any family that immigrates to Israel with children is entitled to a child allowance as of the immigration date.
Is a new immigrant of pension age entitled to an old-age pension?
Yes, subject to certain conditions. Anyone who has reached retirement age (67 for men and 62 for women) will be granted an old-age pension (subject to an income test, or at the age of 70 regardless of income), provided he has accumulated a qualifying national insurance period in Israel (144 months). Any new immigrant who has not accumulated the required qualifying period or who immigrated to Israel after the age of 62 and is not entitled to an old-age pension is entitled to a special old-age pension designated for new immigrants and returning residents.
Does the old-age pension for a new immigrant depend upon the country from which he emigrated?
Yes. Anyone who emigrated from a country with which there is a social security treaty can accumulate qualifying periods and receive pensions from his country of origin.
Are new immigrants required to complete a qualifying period for medical insurance coverage?
New immigrants under the Law of Return can receive an exemption from the qualifying period for medical insurance coverage.
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Adv. Amos A. Rosenzweig is an of Counsel in the form and heads its National Insurance Institute practice.