How are different expense categories treated in Israel for reimbursement?

Expenses Invoicing Requirements

Please only have receipts issued in your name, and not that of your end employer. Receipts issued with the name of your end employer may cause issues during the reimbursement process

Passports/Work Permits/Visa

Non-taxable expense

Transportation Expenses

No issues, can be claimed as non-taxable as long as receipt is supplied

Per diems

Per diems for employees in Israel are processed in alignment with both Israeli labor regulations and the company’s policy. When an employee undertakes business travel, they are eligible for a daily allowance intended to cover meals, minor expenses, and incidentals, removing the requirement to provide receipts for each individual transaction. Employees must submit a travel authorization or an expense claim form indicating the purpose, dates, and locations related to the business trip, accompanied by documentation such as travel confirmations or itineraries. 

The per diem amount is calculated based on the number of eligible days and official rates, which are governed either by Israeli tax authority guidelines or internal company thresholds—these rates may vary depending on the destination and duration. 

Air Travel/Bus and Train

Flight tickets must be in coach or business to be reimbursed tax-free. Please provide receipt with claim

Taxi, Cabify, Uber, and related apps

No issues - Please supply receipt with claim

Car Rental

No issues - Please supply receipt with claim

Car Parking Fees

No issues - Please supply receipt with claim

Tolls

No issues - Please supply receipt with claim

Other Business Travel-Related Expenditure

No issues - Please supply receipt with claim

Travel Insurance

No issues if directly related to business - Please supply receipt

Mileage and Fuel

Taxable

Fuel cannot be submitted unless presented together with a car rental agreement. 

Accommodation

$147 per day for meals and drink (approx 500ILS) without accommodation

$88 per day for meals and drink (approx 300ILS) with accommodation

Meals (travel/events/during work)

$147 per day for meals and drink (approx 500ILS) without accommodation

$88 per day for meals and drink (approx 300ILS) with accommodation

Client Entertainment

All client meals are considered as taxable. When hosting foreign clients several requirements need to be met. Please see the expense policy for further details. Entertainment abroad is considered tax free as long as the receipt is presented and the amount does not exceed the per diem limit. 

Staff Entertainment

All client meals are considered as taxable. When hosting foreign clients several requirements need to be met. Please see the expense policy for further details. Entertainment abroad is considered tax free as long as the receipt is presented and the amount does not exceed the per diem limit. 

Mobile Phone bills

Cell phone/ service can be provided, but it is treated as a taxable benefit.

Broadband (Internet)

Taxable expense

Computer Equipment, Software, Office Space, Furniture, Phones, Other Assets

All fixed assets are reimbursed tax free if for business purpose. 

Furniture

All fixed assets are reimbursed tax free if for business purpose. 

Stationery

No issues as long as directly related to business - please supply receipt

Gifts

N/A

Coworking and Office Rentals

Non-taxable expense

Bank Charges

Non-taxable expense

Foreign Currencies

Non-taxable expense

Annual subscriptions

No issues if directly related to business - Please supply receipt

Training Expenses

No issues if directly related to business - Please supply receipt

Medical Claims/Health Check Up and related items/Medical Insurance

No issues as long as directly related to business - please supply receipt

Exception and Other tpyes of expenses

N/A

Event expenses (trade shows/conferences)

No issues if directly related to business - Please supply receipt

Meals (travel/events/during work)

Meals are taxable. Meals abroad - per diem, Local - taxble. Your employer can choose between expensing items and per diem, but tax calculation is based on the max per diem amount.

Two clients - Databricks and Consensys allow for client entertaining to be tax free. Client name and attendees MUST be included

Di minimus expenses (Tips, no receipt)

Please supply receipts with all claims, any claims missing receipts will be treated as taxable

Payroll Reporting

N/A

Additional Reporting

Each month, expense level detail must be downloaded at expense level and shared with the partner

Review process

Two clients - Databricks and Consensys allow for client entertaining to be tax free. Client name and attendees MUST be included

Mileage, internet, phone, any meals in ILS currency (unless as airport), gym - all grossed up