Advanced Training Fund

A Study Fund is a savings fund whose original purpose was to finance advanced training, such as professional conferences and continuing education. Today, this fund primarily serves as a general medium-term savings channel, exempt from tax at the time of withdrawal. Employer deposits to the fund are also exempt from tax up to a certain salary ceiling. The savings can be withdrawn after 3 years for advanced training purposes and after 6 years for any other purpose. Typically, employer contributions to a Study Fund are at a rate of 7.5% of the full monthly salary, and the employee's share constitutes 2.5% in accordance with a collective agreement and/or an extension order applicable to a specific industry. It is customary for the employee to contribute up to 2.5% of their monthly salary to the Study Fund (based on the employee's fixed salary components), while the employer contributes an additional up to 7.5% for the employee (8.4% in teaching professions), up to a monthly salary ceiling of 15,712 NIS. There is an option to contribute more than this amount, but without tax exemption and in accordance with a personal employment contract. Yaakov Shnitman, Labor Law Attorney