Let's discuss a crucial aspect for anyone considering long-term relocation: taxation, retirement, and social rights for long-term immigrants. It's essentially assessing the strength of a country's social safety net.
Israel and Kenya offer vastly different approaches. In Israel, new immigrants, or "Olim Hadashim," often benefit from significant tax breaks, acting as a financial welcome package.
These exemptions ease the initial settling-in period. However, after this period, individuals are fully integrated into the Israeli tax system, encompassing progressive income tax and National Insurance contributions.
The Kenyan system is simpler. Long-term immigrants are generally taxed on Kenyan-sourced income, a straightforward approach without special tax holidays.
This straightforwardness has its advantages; consistent rules without complex phases. Kenya's National Social Security Fund (NSSF) is mandatory for workers, contributing towards retirement.
However, compared to Western systems, the NSSF is more of a provident fund, building personal savings rather than a defined benefit pension. Supplemental private pension plans are often necessary.
Israel's retirement system includes mandatory private pension schemes and old-age pensions from the National Insurance Institute, providing a two-layered safety net.
Access to healthcare is crucial. Israel's universal healthcare system, managed by Kupot Cholim, is comprehensive and accessible to immigrants. Unemployment and child benefits, along with integration programs, further support newcomers.
Kenya's social safety net is more decentralized. The National Hospital Insurance Fund (NHIF) offers subsidized healthcare, primarily for those in the formal sector. Navigating public services can be challenging for those outside the formal sector.
Proactive planning is essential in Kenya, including private health insurance or a thorough understanding of the NHIF. It emphasizes individual responsibility and community support.
Understanding these systems is vital for long-term financial planning. It's not just about earnings, but also about post-retirement security. Seeking professional advice is highly recommended.
Ultimately, whether enjoying retirement in Israel or building a future in Kenya, thorough preparation is key. Consider your entire life's financial journey when making such a significant decision.