 Hi there, welcome back to Daniel's very random channel on YouTube. This is Daniel Rosso here The channel is taking the direction about life in Israel all aspects of it the interesting Places I see the interesting people I meet all the various interesting facets of living in Israel So if you do want to get videos on my other Random list of topics. I've done videos about Turkish coffee M discs long long list do check out little side YouTube channel I started up called Daniel Rosso plus, but only if you're really really interested if you like the videos about Israel You want to get more videos about Israel? This will be the place. Okay today got a letter in the post from the tax authority and it's it struck me is a good time to do a video about the disadvantages of Being an at my or a self-employed person in Israel because this is definitely one of the facets of life in Israel that I can speak a Lot too. I've been doing this on and off, but mostly on since 2015 so for eight eight years So this will be my ninth year as an at my in Israel along the way. I've seen different permutations I've been a vet exempt trader and Osec Patur I've been a vast non exempt or a single trader has to pay vast a Osec Murshah. I've done hybrid jobs I've done office jobs I've done freelancing alongside an office job being a Sacher and an at my I've done lots of different permutations and I can sort of See the pros and cons from having done both in Israel of being an at my I'm being a Sacher at my Independent worker Sacher conventional office worker you work for a company You get a pay stub and I can speak to a little bit about specifically I wanted to focus on the Disadvantages of being an at my because there are a lot of advantages I want to leave them for another video and maybe talk about the broad pros and cons in another video But today I wanted specifically to focus on the disadvantages because for people looking at getting into this and I Predict that there's going to be a lot more people not just in Israel, but around the world Getting into either full-time Self-employment or doing this alongside Conventional office jobs doing that mixture. I think that's very much the direction We're we're headed in so the first challenging part of being an at my in Israel I would say if you're looking for an easy way to make money and You know not have to worry about you know Just to have a good job and leave it at that and have a lot of energy to put into all the other important aspects of life Especially one's life in Israel social life learning Hebrew, etc. I probably not recommend going down the at my you right because it is very Very hard There is a lot of moving parts to keep on top of and that basically comes down comes down to the Relationships you have to have as a at my is a independent trader what in the UK and Ireland would be called a sole trader and just to quickly talk about the forums for those who maybe are watching this video because they're thinking about doing that or Someone they know is doing that in Israel You have what are called OSAC patour and OSAC more share which are both non-corporate independent trading entities one has to charge 17% VAT some professions can only be done as an OSAC more share and after you hit a certain threshold Turnover you need by law to go from a patour to a more share Once you become an OSAC more share that non-exempt you need to report to the VAT authority part of the tax authority every two months. You need to a reconciliation of here's the VAT I charge to Israeli clients. Here's any VAT I deducted from any deductible expenses from Israeli merchants And this is the reconciliation and here's a much here's how much I owe or here's how much you owe me government Even if it's zero and zero you still need to do it. So yeah being that's my E And that's that's that's just me as a non-American by the way That's another aspect is that a lot of people in Israel who are Attracted to the world of self-employment are Americans and Jewel American Israeli citizens and then they need to worry about the extraordinary extrajudicial taxation of the IRS and that's a whole nother headache Which I can't speak to because I'm not in that situation myself Basically, you have your batua clumi and as of a few years ago, you also need to worry about a pension Now this is a good thing. You know, the government is basically telling Independent independent workers that even if you're barely scraping by you need to contribute a minimum amount to your pension Be putting away every month so that when it comes to your retirement age You are not destitute and penniless and then we're going to have to take care of you then So it's kind of proactive Uh, proactive move from the government. It's always of course advisable To have a pension It's even including if you are not my E But the change a few years ago was that that was made mandatory technically if you don't make your your minimum contributions You can be fine. It's not a huge fine, but it's a fine The tricky thing about these things batua clumi and pension Is not that they're inherently that difficult to do. I will talk about the cash flow issues you can run into later It's that they all take time and especially if you got the language barrier You've got to deal with that aspect of it as well as I've moved on my own journey from my started doing this in 2015 Because I saw a lot of Israeli companies hiring Riders and I was like sure I'm looking for a full-time job, but I need money for now so That's how I started freelancing and over the course of the years as I've been an office worker and Hybrid worker and a remote worker and just a freelancer gone through all those things as the freelancing has become less Just sort of a short term thing and more. Okay. This is my career Um the complication has increased so I've needed to I open my file myself Which is something I probably wouldn't recommend doing but if you want to open your own teak There is you can do that. You don't need an accountant But I in the first year hired an accountant and now I work with an accountant and a bookkeeper and a pension advisor So if you want to do this well and properly, you're either going to need to spend a lot of time learning about the nuances of different pension funds and how much you should be contributing and Not on Karen he still moved and make sure you're not missing out on any of these financial opportunities that are there to you Or work with a pension agent for but to acclome and all the other stuff You have to manage the reports yourself. You need to report to both entities every two months Again, some people choose to have an agent for that But if you don't or you don't have money to pay an accountant to do that for you or a bookkeeper You need to do the reconciliation yourself It's just a lot of extra work that none of these things are things you need to worry about as a sachir as an In-office worker. The company has a pension agent You sign up to their track their plan. You get a paystub every month. It lists your pension deduction It lists your betuak lomi contribution You don't find that you owe anybody betuak lomi or whatever money So it's a lot less stressful to be a In-office worker. It's a lot more lost a lot a lot less complicated But like that the second disadvantage outside in israel is that there really aren't any guarantees now I would say in terms of jurisdictions I obviously can't compare israel to every different country in the world A couple of things stand out to me as this maybe isn't the most small business friendly country out there The first is that the bureaucracy is I don't like the word intense. I would say rigorous, right? They need you to report six times a year. It's almost guaranteed that every new Trader is going to be asked to submit a statement of capital goods What's called a hats are at home? So israel takes reporting seriously, but there it doesn't really offer much of a safety net if stuff goes wrong So when you have a job in israel, there's something called pizzuim, which is like severance pay Needless to say if you're an atzema e, it's your own your your own entity. You're not entitled to any pizzuim I mentioned that I've been doing this for a number of years now The only way that I've been able to actually do that is through having Retainers a fixed monthly income or doing this alongside jobs. I found doing it month to month way way too stressful But that can be another area Problematic for a lot of people is that if you are doing this month to month and you run into the kind of feast or famine stuff Which tends to plague freelancers wherever they live in the world You can go from having a really thriving freelance business whether you're a videographer a photographer A freelance writer or a freelance UX designer or a programmer or whatever you're doing You can go from doing really really well to doing really really terribly and there's no one there to support you No one's going to be you know, there's no grant or Unemployment even though you're contributing every month to protect but to achleomi you have to your state security There's no safety net. I think that's probably something that israel should change I think that's a big disadvantage that the people don't think about it hasn't happened to me yet Thank god, but there have been extremely scary times During the past four years where one contract ended. I was looking for a new contract. There was a month Stuff worked out, but it could just have easily have not worked out And I would have had a monthly income of zero and it'd been panicking and in financial free falls Go into that aware if you're doing this I really hope it's it changes because I do think that People should be encouraged to go in interesting directions And if they are contributing to the state and social security every month I think the state should have some kind of A protection scheme to help people They get back on their feet if they've had a really bad set back in their business As many as many had during corona and what we saw from the government was basically just kind of these Ones off grant payments. It wasn't a very generous Package for those who received it the final disadvantage is to being an atomite in israel And I wanted to keep this video tightly about israel And that's why i'm ending with this because it's not really an israel specific point But being an independent worker means that you might be spending more time working by yourself or in a room by yourself Like this room than you would in an office environment Obviously, there's nothing stopping you from being going on to client sites if you're that's something that I find really helpful as well That I've done is every time I've had an israeli client I've tried to utilize their presence or a shared presence in israel by asking or being proactive about meeting them in their office and Working at their site and or just meeting it, you know somewhere off site I think it really really helped co-working spaces are great as well But you're gonna have to like engineer that stuff I hope that this Roundup sort of of the disadvantages of being an atomite in israel It wasn't intended to deter anyone from doing that. I thirdly that the best way to do this is to go into it Understanding what the risks are And then look at the upsides and then make an informed decision about whether this is the best path for you And I think the great beauty about the atomite system the system of self-employment in israel is that for all it's kind of Complications on the other hand It's kind of nice to have that teak that file for instance. I just got a notification. I received a payment from youtube So that's also something I can legally do as an atomite in addition to my other work youtube pays me As a monetized creator. It's a small amount now. Hopefully it'll grow Um, but I just report that as income. I send an invoice to youtube that goes into my monthly report I pay tax on that to israel and there's something amazing in that being an atomite and just having a file I'm being legally compliant with these entities means you can work with anyone anyone around the world Passive income active income. You're not restricted to just working with the open jobs in your local job market And the final thing I would say and I didn't want to go too far off topic was this with an atomite You're never constrained. You don't have to just do this You can definitely if your employer allows it do a mixture of sachia working at my work And of course you can close your file go back to working in an office and then open your file later When it suits so I think there's a huge amount of inherent flexibility In the structure hope this is interesting if you're thinking about doing your own starting your own That's my journey or you're already on it And if you want to get more videos about my thoughts about life in israel and things i'm encountering here Feel free to subscribe to this youtube channel