Financial Benefits for IDF Reservists

Israeli reservists (miluim) carry one of the heaviest civic loads in the country, and the state compensates that service through a layered package of payments and tax benefits. This guide maps the four main tracks — grant, compensation, tax credit points and tax refunds — so you can see what you are owed and where to claim it.

Who counts as a reservist for benefits purposes

The benefits below apply to any soldier serving on Tzav 8 (emergency call-up) or routine reserve duty (miluim shotef) of at least one day, with payments tiered by total service days in the tax year. A separate category, yom kavua (a fixed reserve track), is treated similarly but typically generates higher annual credits because the cumulative day count is larger.

Eligibility is verified against the IDF service log via Bituach Leumi (the National Insurance Institute). You do not need a separate certification beyond your call-up paperwork (Form 3010) and the post-service confirmation that the IDF transmits automatically.

The four benefit tracks at a glance

1. Replacement-of-income compensation (tagmul miluim)

Bituach Leumi pays a daily compensation designed to replace the income you lost during service. For salaried employees the employer typically pre-funds the days and is reimbursed by Bituach Leumi; for self-employed reservists the payment flows directly to the reservist after filing forms 502 and 506. The daily rate is capped at five times the average national wage.

2. The reservist grant (manak miluim)

A separate, top-up grant calibrated to total days served in the tax year. For reservists called up under Tzav 8 since October 2023 the rate is sharply elevated, with tiers that can exceed 200 ₪ per day above the routine grant. The grant is exempt from income tax under section 9(7d) of the Income Tax Ordinance.

3. Tax credit points (nekudot zikui)

The Tax Authority adds between 0.3 and 0.6 annual credit points per year to reservists, depending on cumulative service days. A single full point is worth around 2,820 ₪ in 2026 (235 ₪/month). The credit is applied automatically once your service is reported, but it is worth verifying against Form 106 from your employer.

4. Tax refunds and expense reimbursements

Reservists who serve 36 days or more in a tax year unlock broader retroactive refund options through the Tax Authority. The standard six-year retroactive window applies, so reservists who served between 2020 and 2025 can still file a claim. Travel reimbursements between home and the reserve unit are paid by the IDF disbursement officer.

Where to start and which forms you need

Most reservists should begin at the Bituach Leumi reservist portal (bituachleumi.gov.il) for the grant and compensation, and at the Tax Authority's My-Tax portal (taxes.gov.il) for the credit points and refunds. Self-employed reservists almost always need to file forms 502 and 506; salaried employees rarely file anything personally because the employer handles the cycle.

Common pitfalls

Two errors recur in the cases we see at Yesh Cash: salaried reservists who never check Form 106 to confirm the credit points were applied, and self-employed reservists who delay filing 502 until the income tax year closes, losing the chance to smooth the payment over the right months. Both are reversible — a corrected Form 135 or a 137 claim with Bituach Leumi will retrieve the money — but they are friction-heavy.

Beyond the four tracks

Reservists are also eligible for adjacent benefits that sit outside the core financial package: extended unemployment qualifying periods, mortgage payment deferrals at most Israeli banks for reservists serving more than 30 consecutive days, and discounted municipal services (arnona) in many municipalities. The four tracks above are the ones that always apply and are worth checking every tax year.

— Yesh Cash Editor