Israel Keren Hishtalmut (Study Fund) Calculator 2026

Calculate Keren Hishtalmut (קרן השתלמות, Study Fund) contributions for 2026 — Israel's most tax-efficient employee savings vehicle. Employer 7.5% + employee 2.5% of monthly salary up to ceiling ILS 15,712. Tax-free withdrawals after 6 years. Returns ~5-8% annual historic. Treated as bonus by employers — voluntary not mandatory.

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Keren Hishtalmut Basics

Voluntary employer-sponsored savings vehicle. Employer 7.5% + employee 2.5% = 10% total of monthly salary, capped at ILS 15,712 (2026; verify with Tax Authority). Contributions are pre-tax for income-tax purposes; tax-free withdrawals after 6 years of vesting. The most powerful tax-advantaged savings in Israel — significantly better than pension funds for liquid medium-term savings.

Tax Treatment

Contributions: pre-tax — saves income tax + Bituach Leumi (~30-50% combined). Capital gains within fund: tax-free during holding period. Withdrawal after 6 years: completely tax-free. Withdrawal before 6 years: subject to 15-25% capital gains tax. Some emergency early-withdrawal options preserve tax-free status (medical, disability, retirement) — verify with fund.

Ceiling and Tax Optimization

ILS 15,712/month salary cap = ILS 188,544 annual covered salary. 10% × ILS 188,544 = ILS 18,854 maximum tax-advantaged contribution per year. High earners exceed cap on Keren Hishtalmut alone — explore additional pension (kupat gemel le-pitsuyim) and provident fund (kupat gemel le-haskhanot) for additional tax-advantaged savings. Salary above ceiling can still contribute to fund but loses tax advantage.

Withdrawal Strategies

After 6 years vested, full withdrawal is tax-free. Strategies: (1) Hold to maximize compound growth, then withdraw for education / sabbatical / home down-payment. (2) Pension funds at retirement age. (3) Roll into private retirement vehicle to defer withdrawal further. Some funds offer 'segment vesting' — vintage by year, so earliest contributions vested first while newer contributions still vesting. Allows ongoing partial withdrawals.

Sources: Israel Tax Authority, Capital Markets Authority, Israeli Ministry of Finance. Last updated: May 2026.