AOW, pension and tax in Israel: full AOW, and Israel taxes
For the AOW, Israel is a treaty country: a single person also gets the full AOW. The 1973 tax treaty gives Israel the right to tax AOW, company pension and annuities; only a government pension remains taxed in the Netherlands. For olim, the Jewish Agency mentions ten years of exemption on foreign income. In occupied territory, none of this applies.
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If you live in Israel, you receive your full AOW, also as a single person. For the AOW, Israel is a treaty country. Tax is governed by the tax treaty of 2 July 1973, in force since 9 September 1974. According to the Dutch Tax Administration's overview of January 2026, Israel, as your country of residence, has the right to tax your AOW, your company pension and your annuity. The Netherlands only keeps the right to tax a pension from government service. None of this applies if you live in territory occupied by Israel.
| Income | Who taxes according to the Tax Administration | Article |
|---|---|---|
| AOW, Anw, WAO, WIA, WW | Israel | 24 |
| Company pension, also from a state-owned enterprise | Israel | 20, para 1 |
| Annuity | Israel | 20, para 1 |
| Commutation of an annuity | Israel | 24 |
| Pension from government service, such as ABP for work for the government | Netherlands | 21, para 1 |
| Dividend from a Dutch company | the Netherlands may withhold up to 15% | 11, para 2 |
| Rent from a house in the Netherlands | the Netherlands may tax | 7 |
Why does Israel tax and not the Netherlands?
Article 20 of the treaty says that pensions for past employment and annuities are taxable "only" in the country where you live. The AOW falls under the residual article, article 24: whatever the treaty does not name separately is taxed only by the country of residence. The protocol to the treaty does not change that. The exception is article 21: a pension for work for the Dutch government may be taxed by the Netherlands.
In practice, the SVB and your pension fund first simply withhold Dutch wage tax. You stop that with an application for exemption to the Tax Administration, with the form "Declaration of tax liability in the country of residence" attached. Once you have that exemption, you pay the tax on your AOW in the country where you live, the SVB writes. Contributions for the Dutch national insurance schemes fall outside the tax treaty.
How does Israel tax your pension?
That depends on your route. According to the Jewish Agency, a new immigrant who became a citizen since 1 January 2007 gets ten years of exemption from tax on income from abroad. The Jewish Agency also mentions tax credits for 3.5 years for those who made aliyah before 2022, and 4.5 years for those who came after.
The Israel Tax Authority confirms in circular 7/2026 of 5 July 2026 that the exemptions on income from outside Israel remain (sections 14 and 97 of the tax law). According to the guide of the Ministry of Aliyah and Integration (December 2022) they last ten years, for olim and for returning residents who qualify. New is a temporary exemption on income from work in Israel, for olim and returning residents who were away for at least ten years and arrive between 5 November 2025 and 31 December 2026. On reporting your foreign income and assets we found no recent official text. If you come as a partner or an employee, the exemption for olim does not apply automatically. Have your position calculated by an Israeli tax adviser before you apply for the exemption in the Netherlands.
Do you get the full AOW in Israel?
Yes. Israel is among the 36 countries outside the EU, the EEA and Switzerland with which the Netherlands has a social security agreement, and the Netherlands exports the full AOW to those countries, the minister wrote in 2024. The 1984 convention says in article 4 that a benefit is not reduced because you live in the other country. So a single person keeps the AOW for single people.
The SVB does not count the Gaza Strip, the West Bank, East Jerusalem and the Golan as treaty territory. According to the minister, anyone who starts receiving AOW there as a single person since 2016 gets the AOW for married people, and the tax treaty does not apply there: the Netherlands then taxes your benefit itself. So keep this in mind when choosing where to live.
What if you leave before your AOW age?
According to the SVB, anyone who goes to live outside the Netherlands is usually no longer insured for the AOW. Each year without insurance means 2% less AOW later. You apply for voluntary insurance within a year of no longer being insured.
Anyone who comes to Israel as a new immigrant after the age of 62 (men) or after retirement age (women) and is not insured for old age can get a special old-age benefit from Bituach Leumi. It is means-tested. Up to age 70, for example, your income from work may not exceed 10,113 shekels for a single person and 13,484 for a couple (2026). Income not from work may not exceed the benefit itself plus the income supplement.
What else does the Netherlands keep hold of?
An annuity, a pension entitlement or a substantial shareholding travels with you under a protective assessment. Outside the EU and the EEA, deferral is not automatic: you apply for it in writing. Deferral runs for at most ten years, and for a pension or annuity the Tax Administration usually asks for security, unless it is held with a Dutch insurer or an exempt Dutch pension fund.
More on the general rules in AOW when emigrating and where your pension is taxed. What it means for your health contribution in Israel is in healthcare in Israel.
In Vertrekklaar this is phase 1 of 5 of the journey, step 1.2: the same steps, but for your situation — in your order, tickable, and with the deadlines watched. See the whole journey to Israel or go straight to step 1.2 in the open plan.
What this means for your numbers →
What this rests on
The facts in this article come from these official pages. Rules change. When in doubt, go by the source, not this article.
- Dutch Tax Administration — Treaty states IB non-residents, January 2026 (Israel, columns NL and ISR) — download.belastingdienst.nl
- Netherlands–Israel tax treaty (Jerusalem, 2 July 1973), articles 20, 21 and 24 — wetten.overheid.nl
- SVB — wage tax on your AOW when you live outside the Netherlands — svb.nl
- Dutch Tax Administration — applying for exemption from wage tax, with the declaration of tax liability in the country of residence — belastingdienst.nl
- Dutch Tax Administration — which deductions and tax credits you have when you live outside the Netherlands — belastingdienst.nl
- Netherlands–Israel social security convention (Jerusalem, 25 April 1984), article 4 — wetten.overheid.nl
- SVB — the AOW treaty countries, Israel excluding the Gaza Strip, West Bank, East Jerusalem and Golan — svb.nl
- Answers to parliamentary questions 2024Z02891 — Israel among the 36 treaty countries with full AOW export — open.overheid.nl
- Letter to parliament 23432-417 (8 December 2015) — AOW and the tax treaty in territory occupied by Israel — zoek.officielebekendmakingen.nl
- SVB — each uninsured year 2% less AOW, and voluntary insurance within a year — svb.nl
- Dutch Tax Administration — the protective assessment and deferral outside the EU (2026 return guidance) — belastingdienst.nl
- Jewish Agency — the tax benefits for new immigrants — jewishagency.org
- National Insurance Institute — the special old-age benefit for new immigrants and returning residents — btl.gov.il
- Israel Tax Authority — circular 7/2026 (5 July 2026), the exemptions on income from outside Israel remain, and a temporary exemption on work in Israel — gov.il
- Ministry of Aliyah and Integration — Guide for the New Immigrant (December 2022), ten years of exemption on income from abroad — gov.il
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