Payroll Accountant in Eilat

Why Do You Need a Payroll Accountant in Eilat?

If you employ workers or employees who need a tax refund, payroll management is one of the first things that needs to be in order. An incorrect payslip, inaccurate mandatory deductions, or delayed reporting to the Tax Authority can lead to hefty fines and bureaucratic complications that can be avoided.

Ben Or Kook Accountants assists freelancers, exempt and licensed business owners, private limited companies, and nonprofit organizations in Eilat and throughout the country — from daily payslip management to filing accurate annual reports with the Tax Authority. Our service is personalized, digital, and accessible, because we understand that business owners need to rely on someone who understands the complexities of income tax, national insurance, and severance funds.

On this page, we will explain what payroll management involves, who it is relevant to, what common mistakes we see in the field, and when it is advisable to consult an accountant. If you are looking for a firm that understands local requirements and can provide reliable support — you are in the right place.

What Is Payroll Management and Who Does It Apply To?

Payroll management is the process of calculating, deducting, and reporting employee salary expenses. Each month (or at different intervals according to the employment agreement), an employer must calculate the gross salary, make mandatory deductions such as income tax and national insurance, and issue an accurate payslip. At the end of the year, an annual report must be submitted to the Tax Authority summarizing all income and deductions.

This is relevant to you if:

• You are a freelancer or business owner (exempt or licensed) who employs permanent or temporary workers.
• You are the owner of a private limited company with employees in various positions.
• You manage a nonprofit organization or association with a team.
• You are a salaried employee who received a payslip with deduction errors and need a tax refund.

If you are a regular salaried employee, your employer is responsible for reporting, but you can consult an accountant to verify that deductions are correct and submit a tax refund request form if there is an overpayment.

How Payroll Management Works — Step by Step

Managing payroll involves several recurring and meticulous steps. In short, here's how it works:

1. Document collection at the beginning of the year — each employee must submit Form 101 (income tax declaration for employee), identity information, bank details, and national insurance information. If there are changes during the year (tax deduction, new child), these must be updated.
2. Monthly salary calculation — based on base salary, bonuses, additional salary expenses, and vacation days taken. All of this must be in accordance with a clear employment agreement.
3. Mandatory deductions — income tax (at rates varying by bracket), national insurance, severance fund (if applicable), and pension. If there are loans or garnishment orders, additional deductions must be made.
4. Issuing payslips — a document showing all details to the employee, must be in writing and in accordance with law.
5. Reporting to the Tax Authority — each month (or at different intervals), you must report the deductions made and expenses via a draft report or computerized system.
6. Annual report — at the end of the year, an annual report must be filed with the Tax Authority summarizing all salaries and deductions, and calculating whether there is an overpayment or debt.

Each step involves accurate data and timely reporting. Any mistake — whether it's an incorrect deduction or late reporting — can result in fines and administrative complications that intensify over time.

What You Should Know About Income Tax and National Insurance in Payroll Management

The two main systems affecting payslips are income tax and national insurance. Income tax varies depending on salary level and your tax benefits (such as employee deduction, child deduction, or deduction for employee in a specific field). National insurance is a fixed payment based on salary level and obligates both employer and employee.

Typically, the employer deducts the amounts from salary and transfers them to the Tax Authority and National Insurance at different intervals (monthly, bimonthly, etc.). If not done on time, interest and penalties will be due. This is why many of the clients we see at Ben Or Kook prefer to transfer management to us — it reduces stress and ensures everything is in order.

One point that is not always clear: if an employee leaves work in the middle of the year, this must be reported to the tax authorities and the National Insurance Institute in a special manner. It is not simply stopping reporting — a proper closure of the employee file is required.

Common Mistakes in Payroll Management — and How to Avoid Them

Throughout our years of working with self-employed professionals and companies in Eilat and across the country, we have observed recurring patterns of errors that could have been easily prevented:

• Incorrect income tax deductions — an outdated tax allowance or one that was completely forgotten. This results in a payslip with deductions that are too high or too low, and at year-end there are reporting issues.
• Late reporting to the tax authorities — when an employer is busy or forgetful, monthly reporting does not arrive on time. Penalties for late reporting accumulate quickly.
• Lack of documentation for additional payroll expenses — bonuses, representation fees, insurance premiums that were not properly documented, and by year-end there is no clear record.
• Failure to manage changes in tax benefits — an employee received a new child or new entitlement, and the employer forgot to update Form 101. This affects every payslip from that month onwards.
• Payslips not provided in writing — legally, every payslip must be given to the employee in writing (digital format is also permitted). If this is not properly documented, you are at risk if there is a dispute with the employee or a tax authority inspection.
• Discrepancy between payslips and annual report — sometimes the employer maintains payslips separately and reporting to the tax authorities does not match. This raises red flags during inspection.

The best way to avoid these errors is to entrust the management to an accounting firm that knows the details. We at Ben Or Kook handle all of this systematically — from updating forms at the beginning of the year, through monthly reporting, to an accurate annual report.

Common Scenarios — and How We Handled Them

To help you better understand how we work, let's go through a few scenarios we've encountered:

A self-employed person who hired their first employee — A self-employed individual who had worked alone suddenly needed an employee. They didn't know what to do — forms, deductions, reporting. We came in, organized all the forms at the beginning of the year, set up a monthly reporting system, and handled all the reports. Today, they know everything is in order.

A company owner who received notice of a tax authority audit — An employer received notification that the tax authority was auditing their annual reports. There were discrepancies between payslips and reporting. We sat down, organized all the files, prepared a detailed explanation for the tax authority, and completed the audit successfully.

An employee who received a payslip with double tax withholding — An employee called saying their payslip had excessive tax withholding. We checked their Form 101 — a tax relief checkbox hadn't been updated. We updated the form, and once the employer entered the update into the system, the withholding returned to the correct amount.

In every case, the process was the same: understanding the situation, identifying the problem, fixing it, and reporting correctly to the tax authority.

When Should You Consult a Payroll Accountant

If you're considering whether you need help with payroll accounting, here are some criteria:

• You are self-employed or a business owner who is hiring an employee for the first time.
• You employ more than one person, and there is complexity in salary calculations (tax relief, bonuses, pensions).
• You received a notice from the tax authority or National Insurance about reporting discrepancies.
• You are an employee and suspect errors in your payslip, and need a tax refund.
• You are unsure which forms you need to comply with, or how to update tax benefits.
• You want to transfer monthly management to someone who knows the details, so you can focus on your business.

Ben Or Kook offers a free initial consultation. In this meeting, we listen to your situation, explain the legal requirements, and propose a support plan tailored to your business. There's no obligation — it's simply a conversation between two parties to see if this can work.

Why Choose Ben Or Kook for Payroll Services in Eilat

We are a small and personal accounting firm that understands the needs of self-employed individuals and small businesses in Israel. We are not a giant firm that doesn't know your name. Every Ben Or Kook client receives personal guidance — a specific accounting office that knows the details of your business.

We work digitally, so you can send us documents, use a secure portal, and speak with us via Zoom or phone. There is no need for physical meetings all the time (although we are located in Ramat Gan and Petah Tikva if you prefer).

Additionally, we monitor changes in legislation and tax authority requirements. Every year there are minor updates in national insurance rates, tax brackets, and new tax benefits. We ensure you are always up-to-date.