How to Do Tax Coordination (Te’um Mas) in Israel 2026

But maybe:

You have children → you’re entitled to additional tax credit points

You’re married → you can split/allocate credits between you

You live in the periphery → you may be entitled to an extra credit point

You have income from multiple sources → you need coordination so you don’t overpay

Tax coordination solves this: you submit a request to the Israel Tax Authority, they review your real situation, and adjust your withholding so you pay only what you owe — not less, not more.

A simple example

Ronit works full-time earning ₪12,000. She has two children.

Without tax coordination:

Her employer withholds tax based on only 2.25 credit points = ₪750 tax per month

With tax coordination:

Ronit submits a request and receives 4.25 credit points (2.25 base + 2 children) = ₪205 tax per month

Savings: ₪545/month = ₪6,540/year!

🔢 Did you know?
About 30% of Israelis are eligible for tax coordination but don’t do it — meaning they overpay tax throughout the year and then wait for a refund at year-end. Why not get the money now?

Why do you need tax coordination? 5 key reasons

1. Prevent overpaying tax during the year

If you pay too much tax every month, you’re giving the government an interest-free loan. Tax coordination ensures you pay only what you actually owe.

2. Get the money now (not at year-end)

Instead of waiting for a tax refund next year, you get the money now — in each paycheck.

3. Use all the benefits you’re entitled to

Tax credits for children, residents of certain areas, working women — many people don’t use the credits they deserve.

4. Avoid surprises at the end of the year

If you work multiple jobs or have additional income, without coordination you may end up paying too little during the year — and then owe a large amount later.

5. Real savings — hundreds to thousands per year

Tax coordination can save you ₪200–2,000 per month, depending on your situation.

Our guide to income tax calculation explains the full system.

Who needs tax coordination? 8 common situations

1. Working at multiple jobs

If you have 2 (or more) employers, you must do tax coordination.

Why?

Each employer withholds tax separately and doesn’t know about your income from the other employer. That can lead to paying too little tax — and then you’ll owe money at year-end.

2. You have children and didn’t receive the tax credits

Each child gives you tax credit points. If your employer doesn’t know (or it wasn’t updated), you’re paying too much tax.

3. You’re married and want to allocate credits

Spouses can split tax credits (for children, for example) in the most tax-efficient way. Tax coordination enables this.

4. You live in the periphery (development area)

Residents of certain development areas may be entitled to additional tax credits (0.5–1 point). Without coordination, you may not receive it.

5. You have additional income (rent, freelance, dividends)

If you earn income beyond your salary, tax coordination helps ensure you’re paying the correct amount.

6. You’re a working woman

A working woman may be entitled to an extra 0.5 credit point. If it isn’t updated, you’re overpaying.

7. You’re over age 60

People over 60 may be entitled to an additional credit point in the first tax bracket.

8. Your salary changed significantly

If you got a big raise or your salary decreased, tax coordination helps adjust withholding accordingly.

How to do tax coordination: step-by-step

Step 1: Go to the Income Tax website

Website: https://www.gov.il/he/service/tax_coordination

You’ll need to log in with:

ID number
Personal code (if you have one) or SMS verification

Step 2: Fill out Form 116 (Tax Coordination Form)

This is the official form for requesting tax coordination. It’s online and relatively straightforward.

What you’ll fill in:

Personal details: name, ID, address
Income details: all income sources (salary, rent, freelance)
Tax credits: children, marital status, residence area, age
Employers: employer name(s), tax file number(s)

Step 3: Attach documents

Usually required documents:

Recent payslips (last 3–6 months)
Prior-year income statement (Form 106)
Children’s birth certificates (if applicable)
Proof of residence (if you live in a qualifying area)
Other confirmations: depending on your case (disability, reserve service, etc.)

Tip: Scan everything in advance — uploading on the site is simple.

Step 4: Submit the request

Once you’ve completed the form and uploaded documents — submit.

What happens next:

The Tax Authority reviews the request (typically 2–4 weeks)
If they need extra documents, they’ll ask

Step 5: Receive your tax coordination approval

After approval, you’ll receive a tax coordination approval document (Form 116/A).

It includes:

How many credit points you received
How withholding should be split between employers (if you have more than one)
Validity (usually until the end of the year)

Step 6: Give it to your employer

Very important:

Send the approval to your employer (or employers)
Your employer will update withholding starting next month
Keep a copy for yourself

Tip: Make sure payroll actually updated it — check your next payslip.

Tips to maximize savings with tax coordination

1. Check every credit/benefit you’re entitled to

Many people don’t know about credits like:

Working woman credit (0.5)
Periphery/development-area credit (0.5–1)
Credits for extensive reserve service

Check what applies to you in the Tax Authority’s guidance.

2. Allocate credits smartly (married couples)

If both spouses work, allocate child-related credits so the higher earner gets more of them.

Why?

Someone in a higher tax bracket saves more per credit point.

Example:

Husband earns ₪20,000 (31% bracket)
Wife earns ₪10,000 (20% bracket)

Better if the husband receives more credits — the savings are larger.

3. Renew every year

Tax coordination is usually valid only until year-end. Redo it at the beginning of each year (Jan–Feb).

4. Use “multi-year coordination” (if available)

If your situation is stable (same salary, same children), you may request coordination for multiple years.

Advantage: you don’t have to redo it annually.

5. If you work multiple jobs — coordinate the split

You can request that one employer withholds most of the tax, and the second withholds little or none. This can help with cash flow.

6. Do it yourself — it’s free

You don’t need an accountant for simple tax coordination. The site is clear and the process is straightforward.

Savings: ₪500–1,500 that might otherwise go to an accountant.

Our guide to average salary in Israel can help with financial planning.

Common mistakes to avoid

❌ Mistake 1: Not updating the employer

You got the approval but didn’t send it to payroll? Nothing will change.

❌ Mistake 2: Not renewing annually

Tax coordination expires at year-end. If you don’t renew, you go back to standard withholding.

❌ Mistake 3: Not reporting changes

If your salary changes significantly or you have another child — update the coordination.

❌ Mistake 4: Thinking “it’s too complicated”

It’s really not. 30 minutes of work can save thousands of shekels.

FAQs

How long does approval take?

Usually 2–4 weeks. During busy periods (Jan–Mar) it can take up to 6 weeks.

Can I do tax coordination mid-year?

Yes. You can do it anytime. The change typically applies from the month after approval.

What if I made a mistake in the form?

You can correct it or submit a new request. The Tax Authority may also ask for clarifications.

Does tax coordination affect my annual tax refund?

Yes — if done correctly, you shouldn’t have a big gap (no huge refund, no huge debt). That’s the whole point.

Is there a cost?

No. Tax coordination is a free service from the Tax Authority.

What if I’m self-employed?

Self-employed people don’t do tax coordination (there’s no payroll withholding). Instead, they file an annual report and pay advance payments.

🗞️ Related articles

Tax coordination = money in your pocket

Tax coordination isn’t “something complicated for accountants” — it’s a simple, free tool that can save you hundreds to thousands of shekels per year.

Key takeaways:

Tax coordination aligns withholding with your real situation
Who needs it: multiple jobs, children, periphery residents, or extra income
The process is simple: Form 116 on the Tax Authority website + document upload + approval
Savings can be ₪200–2,000 per month depending on your case

Next step:

Today: check if you’re eligible (kids? multiple jobs? periphery?)
This week: go to the Tax Authority site and start the process
This month: get approval and send it to payroll

Remember: every month you don’t do tax coordination = money left on the table. Go get it.