Some one else posed this question and I am posting it here, with my answers interspersed. Hope it hopes him and you!
I have been reading your blog about succeeding as an “Atzma’i” for advice about my situation. I am a 24 year old recent oleh from Boca Raton, FL now living in Jerusalem.
>>Welcome! my sister is from Boca, we should compare notes..
I am in the midst of my enlistment process for the IDF, having already hope to be drafted in the summer.
>>Behatzlacha rabba on that too!
In the meantime, I’ve been hired as an outside contracted translator for a consulting firm based in Tel Aviv, on a part-time basis. My employer says that her company can only pay me if I open an “Osek Za’ir” file, because I am not a company employee and they do not want me to be entitled for full employee benefits.
>>They are thinking inside the box that they know. The know that they do not want to hire you, for the reason you mention and maybe others. They know that they have to work within the framework of the law, so they cannot pay you “under the table.” They realize that they will not be paying you so much that it would make it worth your while to open up a tik as osek mursheh, and they are familiar with the less known possibility of Osek Zair, which seems to fit your situation, so that is what they are recommending/requiring of you.
Researching your site and speaking to other people, it seems she meant an “Osek Patur”.
I intend to work at this position until my army draft, no more than 4 or 5 months. Moreover, the total salary I earn won’t amount to more than 20,000 shekels.
>>If this (or even as much as about 60K NIS) is all that you will make during calendar year 2010 in receiptable work (not as an employee, or as a soldier I would venture to guess – any position with a tlush maskoret) then they are right – you can be an osek zair, and probably should be.
I’ve spoken to some employment specialists from Nefesh B’Nefesh, and a few Jerusalem-based accountants about my status and which option of registering as an independent seeks me best. The consensus among them seems to be that I should open an Osek Patur of the “third category”- as an atzma’i- with a Koach Adam company.
>>I am not sure what you mean here. When you go to open as an Osek Patur (in the VAT office), you actually first open as an Atzmai in the Mas Hachnasa office. There, at Mas Hachnasa, they ask you what you want to do as your business, but I don’t remember categories, you just tell them Translation Services or Translating and Business related services or whatever, they don’t really care too much about small businesses that barely bring them tax income at all .. I for SURE don’t understand this Koach Adam part..
(One account told me to look up a Jerusalem-based company called Oleh Sapir in the white pages, which I couldn’t find) According to them, I open a file with this company, and my employer sends my paychecks to this firm, who takes a small commission to handle my case.
>>Ahh. “Oleh Sapir” is probably Yeul Sachir, a company that I am quite familiar with, and owe my loyal readers a deeper post about. I can see how someone might call this a Koach Adam company, but it works quite differently from standard koach adam companies, like Manpower.
With Manpower, they collect potential workers for positions that they specialize in, then companies who want to hire someone to do that job but want to save themselves some headaches (interviewing, training, benefits, etc etc) and frequently for a short term contract, go to Manpower and get someone.
With Yeul Sachir, the service professionals do the services they specialize in, but they also do the marketing of their services, and have a personal relationship with the companies/people they do business with. Yeul Sachir does the finance work, bills your client and collects (with help from you) and pays you with a tlush, as you are legally their employee. They take a cut of 7% up to 400 NIS a month for their services.
They maintain that the advantages of this option include: easy opening and closing my file as an Osek Patur,
>>Actually, establishing a repationship with Yeul Sachir obviates the need to open or close an Osek Patur file at all.
no taxation on American assets,
>>I am not sure of this one
and no hassle opening my own Osek Patur at varius bureaucratic agencies while I am being interviewed by the army agencies to secure my placement.
as above, no need to interface at all with Mas Hachnasa or VAT
I am still confused about how to proceed, as I am in the dark with the Israeli tax system and bureaucratic institutions. I would greatly appreciate any advice you can give me about how to go about this.
>>Notwithstanding the extensive descriton I gave above of Yeul Sachir, since it looks like you are only going to bill about 20K NIS this calendar year, and since I assume your client will be a business, which means they do not care whether they “pay” their service providers VAT or not (because the deduct it), Rodan Gordon (principal at Yeul Sachir) would probably encourage you to open a tik as an Osek Zair.
Try calling him at 02-6510666, tell him Gidon sent you.