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| 1 | --- |
| 2 | name: japan-payroll |
| 3 | description: > |
| 4 | Use this skill whenever asked about Japanese payroll, income tax withholding |
| 5 | (源泉徴収 gensen chōshū), social insurance (社会保険 shakai hoken), labour |
| 6 | insurance (労働保険 rōdō hoken), or employer obligations in Japan. Trigger on |
| 7 | phrases like "gensen choshu", "源泉徴収", "shakai hoken", "社会保険", |
| 8 | "厚生年金", "kosei nenkin", "kenko hoken", "健康保険", "雇用保険", |
| 9 | "koyou hoken", "労災保険", "rosai hoken", "年末調整", "nenmatsu chousei", |
| 10 | "year-end adjustment", "standard monthly remuneration", "hyōjun hōshū getsugaku", |
| 11 | "payslip Japan", "給与明細", "kyūyo meisai", "minimum wage Japan", |
| 12 | "overtime Japan", "36 agreement", "子ども・子育て支援金", |
| 13 | or any question about running payroll in Japan. ALWAYS read this skill before |
| 14 | processing any Japanese payroll work. |
| 15 | version: 1.0 |
| 16 | jurisdiction: JP |
| 17 | category: payroll |
| 18 | depends_on: |
| 19 | - payroll-workflow-base |
| 20 | --- |
| 21 | |
| 22 | # Japan -- Payroll Skill v1.0 (日本の給与計算) |
| 23 | |
| 24 | --- |
| 25 | |
| 26 | ## Section 1 -- Quick Reference |
| 27 | |
| 28 | | Field | Value | |
| 29 | |---|---| |
| 30 | | Country | Japan (日本国) | |
| 31 | | Currency | JPY (¥) only | |
| 32 | | Tax year (income tax) | Calendar year (1 January -- 31 December) | |
| 33 | | Fiscal year (social insurance) | 1 April -- 31 March | |
| 34 | | Primary legislation | Income Tax Act (所得税法); Labour Standards Act (労働基準法); Health Insurance Act (健康保険法); Employees' Pension Insurance Act (厚生年金保険法); Employment Insurance Act (雇用保険法) | |
| 35 | | Tax authority | National Tax Agency (国税庁 NTA) | |
| 36 | | Social insurance authority | Japan Pension Service (日本年金機構); prefecture health insurance associations | |
| 37 | | Reporting system | 源泉徴収税額表 (withholding tax tables); 年末調整 (year-end adjustment) | |
| 38 | | Pay frequency | Monthly (most common, typically 25th or end of month) | |
| 39 | | Employer registration | Tax office (源泉徴収義務者) + Japan Pension Service + Hello Work (ハローワーク) | |
| 40 | | Validated by | Pending -- requires sign-off by a Japanese certified tax accountant (税理士) or social insurance labour consultant (社会保険労務士) | |
| 41 | | Skill version | 1.0 | |
| 42 | |
| 43 | --- |
| 44 | |
| 45 | ## Section 2 -- Income Tax Withholding (源泉徴収) |
| 46 | |
| 47 | Japanese employers withhold income tax monthly using the NTA's published withholding tax tables (源泉徴収税額表 -- monthly table / 月額表). The tables include the 2.1% reconstruction surtax (復興特別所得税, in effect through 31 December 2037). |
| 48 | |
| 49 | ### Withholding Table Categories |
| 50 | |
| 51 | | Column | Japanese | Criteria | |
| 52 | |---|---|---| |
| 53 | | 甲 (Kō) | Primary employer | Employee has submitted 扶養控除等申告書 (dependency exemption declaration) | |
| 54 | | 乙 (Otsu) | Secondary employer | No declaration filed; flat 3.063% minimum or table rate | |
| 55 | |
| 56 | The 甲 table uses the employee's number of dependents (扶養親族等の数) to determine the withholding amount from a lookup table, not a formula. |
| 57 | |
| 58 | ### Reference: Individual Income Tax Brackets (Annual) |
| 59 | |
| 60 | These are the annual rates applied at year-end adjustment (年末調整) or final return (確定申告). Monthly withholding approximates these progressively. |
| 61 | |
| 62 | | Taxable Income (JPY) | Rate | Deduction | |
| 63 | |---|---|---| |
| 64 | | 0 -- 1,950,000 | 5% | ¥0 | |
| 65 | | 1,950,001 -- 3,300,000 | 10% | ¥97,500 | |
| 66 | | 3,300,001 -- 6,950,000 | 20% | ¥427,500 | |
| 67 | | 6,950,001 -- 9,000,000 | 23% | ¥636,000 | |
| 68 | | 9,000,001 -- 18,000,000 | 33% | ¥1,536,000 | |
| 69 | | 18,000,001 -- 40,000,000 | 40% | ¥2,796,000 | |
| 70 | | 40,000,001+ | 45% | ¥4,796,000 | |
| 71 | |
| 72 | Plus 2.1% reconstruction surtax on calculated tax. Plus separate resident tax (住民税) at approximately 10% (municipal + prefectural), withheld from June of the following year. |
| 73 | |
| 74 | ### Employment Income Deduction (給与所得控除 -- 2026) |
| 75 | |
| 76 | | Gross Employment Income (JPY) | Deduction | |
| 77 | |---|---| |
| 78 | | Up to 1,625,000 | ¥650,000 (minimum, raised from ¥550,000 in 2026) | |
| 79 | | 1,625,001 -- 1,800,000 | Income × 40% - ¥100,000 | |
| 80 | | 1,800,001 -- 3,600,000 | Income × 30% + ¥80,000 | |
| 81 | | 3,600,001 -- 6,600,000 | Income × 20% + ¥440,000 | |
| 82 | | 6,600,001 -- 8,500,000 | Income × 10% + ¥1,100,000 | |
| 83 | | 8,500,001+ | ¥1,950,000 (cap) | |
| 84 | |
| 85 | ### Year-End Adjustment (年末調整) |
| 86 | |
| 87 | Employers must perform nenmatsu chōsei in December for all 甲 employees. This reconciles monthly withholding to the actual annual tax liability, accounting for insurance deductions, spouse/dependent deductions, and housing loan credits. The employer refunds or collects the difference in the December (or January) payroll. |
| 88 | |
| 89 | --- |
| 90 | |
| 91 | ## Section 3 -- Social Security: Employee Deductions (社会保険 / 労働保険) |
| 92 | |
| 93 | Japanese social insurance premiums are split approximately 50/50 between employer and employee (except workers' compensation which is employer-only and child allowance contribution which was employer-only until 2026). |
| 94 | |
| 95 | ### Employee Share of Social Insurance (2026) |
| 96 | |
| 97 | | Premium | Employee Rate | Basis | Ceiling | |
| 98 | |---|---|---|---| |
| 99 | | Health insurance (健康保険) | ~4.925% (Tokyo) | Standard monthly remuneration (SMR) | Grade 50: ¥1,390,000/month | |
| 100 | | Long-term care insurance (介護保険) | ~0.810% | SMR | Same as health; ages 40--64 only | |
| 101 | | Welfare pension (厚生年金) | 9.150% | SMR | Grade 32: ¥650,000/month | |
| 102 | | Employment insurance (雇用保険) | 0.50% (from Apr 2026) | Total wages | No ceiling | |
| 103 | | Child-rearing support (子ども・子育て支援金) | 0.115% (from Apr 2026) | SMR | Same as health | |
| 104 | |
| 105 | **Health insurance rates vary by prefecture and insurer.** The Tokyo rate shown (9.85% total / 4.925% employee) is illustrative. Each prefecture's Kyōkai Kenpō (協会けんぽ) publishes its own rate. |
| 106 | |
| 107 | ### Standard Monthly Remuneration (標準報酬月額) |
| 108 | |
| 109 | Social insurance premiums are based on the SMR, a standardised salary grade (not actual pay). SMR is determined in September each year (算定基届 santei kiso todoke) based on April--June average earnings. Changes mid-year only occur with significant salary changes (随時改定 zuiji kaitei -- ≥2 grade change sustained over 3 months). |
| 110 | |
| 111 | ### Bonus Premiums |
| 112 | |
| 113 | Social insurance premiums also apply to bonuses at the same rates, subject to annual caps: |
| 114 | - Health insurance: ¥5,730,000 cumulative annual cap on bonus |
| 115 | - Welfare pension: ¥1,500,000 per single bonus payment |
| 116 | |
| 117 | --- |
| 118 | |
| 119 | ## Section 4 -- Social Security: Employer Contributions |
| 120 | |
| 121 | ### Employer Share of Social Insurance (2026) |
| 122 | |
| 123 | | Premium | Employer Rate | Notes | |
| 124 | |---|---|---| |
| 125 | | Health insurance (Tokyo) | ~4.925% | Same as employee | |
| 126 | | Long-term care insurance | ~0.810% | Same as employee (ages 40--64) | |
| 127 | | Welfare pension | 9.150% | Same as employee | |
| 128 | | Child allowance contribution (子ども・子育て拠出金) | 0.360% | Employer-only; on SMR | |
| 129 | | Child-rearing support (子ども・子育て支援金) | 0.115% | From Apr 2026; same as employee | |
| 130 | | Employment insurance | 0.85% (from Apr 2026) | Higher than employee share | |
| 131 | | Workers' compensation (労災保険) | 0.30% (typical office) | Employer-only; rate varies by industry (0.25%--8.8%) | |
| 132 | |
| 133 | ### Total Indicative Employer Cost (2026, Tokyo, Age 40--64) |
| 134 | |
| 135 | | Component | Rate | |
| 136 | |---|---| |
| 137 | | Health + long-term care | 5.735% | |
| 138 | | Welfare pension | 9.150% | |
| 139 | | Child allowance + child-rearing support | 0.475% | |
| 140 | | Employment insurance | 0.850% | |
| 141 | | Workers' compensation (office) | 0.300% | |
| 142 | | **Total employer social insurance** | **~16.51%** | |
| 143 | |
| 144 | For employees under 40 (no long-term care): approximately 15.70%. |
| 145 | |
| 146 | --- |
| 147 | |
| 148 | ## Section 5 -- Minimum Wage and Overtime |
| 149 | |
| 150 | ### Minimum Wage |
| 151 | |
| 152 | Japan has no single national minimum wage. Each prefecture sets its own rate annually (effective October). The national weighted average reached ¥1,121/hour in October 2025. |
| 153 | |
| 154 | | Prefecture | Rate (JPY/hour, Oct 2025) | |
| 155 | |---|---| |
| 156 | | Tokyo | ¥1,163 | |
| 157 | | Kanagawa | ¥1,162 | |
| 158 | | Osaka | ¥1,114 | |
| 159 | | Aichi | ¥1,077 | |
| 160 | | Fukuoka | ¥1,004 | |
| 161 | | Okinawa | ¥952 | |
| 162 | |
| 163 | The government targets ¥1,500/hour by the late 2020s. |
| 164 | |
| 165 | ### Overtime (Labour Standards Act) |
| 166 | |
| 167 | | Category | Premium Rate | Legal Basis | |
| 168 | |---|---|---| |
| 169 | | Regular overtime (> 8 hrs/day or > 40 hrs/week) | 125% (25% premium) | Art. 37(1) | |
| 170 | | Overtime exceeding 60 hrs/month | 150% (50% premium) | Art. 37(1) proviso | |
| 171 | | Late-night work (22:00--05:00) | 125% (25% premium) | Art. 37(4) | |
| 172 | | Overtime + late-night | 150% (25% + 25%) | Combined | |
| 173 | | Statutory holiday work (法定休日) | 135% (35% premium) | Art. 37(1) | |
| 174 | | Statutory holiday + late-night | 160% (35% + 25%) | Combined | |
| 175 | |
| 176 | ### 36 Agreement (三六協定) |
| 177 | |
| 178 | Overtime requires a written labour-management agreement (36 Agreement) filed with the Labour Standards Inspection Office. Limits: |
| 179 | |
| 180 | | Limit | Standard | Special Clause | |
| 181 | |---|---|---| |
| 182 | | Monthly | 45 hours | Up to 100 hours (incl. holiday work) | |
| 183 | | Annual | 360 hours | Up to 720 hours | |
| 184 | | Multi-month average | -- | Must not exceed 80 hrs/month over any 2--6 month window | |
| 185 | |
| 186 | Violations can result in penalties of up to ¥300,000 fine or 6 months imprisonment. |
| 187 | |
| 188 | --- |
| 189 | |
| 190 | ## Section 6 -- Mandatory Benefits |
| 191 | |
| 192 | ### Annual Paid Leave (年次有給休暇) |
| 193 | |
| 194 | | Years of Service | Days Granted | |
| 195 | |---|---| |
| 196 | | 0.5 years | 10 days | |
| 197 | | 1.5 years | 11 days | |
| 198 | | 2.5 years | 12 days | |
| 199 | | 3.5 years | 14 days | |
| 200 | | 4.5 years | 16 days | |
| 201 | | 5.5 years | 18 days | |
| 202 | | 6.5+ years | 20 days (maximum) | |
| 203 | |
| 204 | Requires 80% attendance in the preceding year. Employers must ensure employees take at least 5 days per year. Unused leave expires after 2 years. |
| 205 | |
| 206 | ### Maternity Leave (産前産後休業) |
| 207 | |
| 208 | - Pre-birth: 6 weeks (14 weeks for multiple pregnancy) |
| 209 | - Post-birth: 8 weeks (mandatory) |
| 210 | - Benefit: approximately 67% of daily wage from health insurance (出産手当金) |
| 211 | - Lump-sum birth allowance: ¥500,000 (出産育児一時金) |
| 212 | |
| 213 | ### Childcare Leave (育児休業) |
| 214 | |
| 215 | Up to the child's first birthday (extendable to 2 years if daycare unavailable). Benefit: 67% of wage for first 180 days, then 50%, from employment insurance. Social insurance premiums are exempt during leave. |
| 216 | |
| 217 | ### Sick Leave |
| 218 | |
| 219 | No statutory paid sick leave in Japan. Employers typically provide 3--10 days contractually. Health insurance provides injury/sickness allowance (傷病手当金) at 2/3 of daily wage from the 4th day of absence, for up to 18 months. |
| 220 | |
| 221 | ### Retirement Allowance (退職金) |
| 222 | |
| 223 | Not legally required but deeply customary. Approximately 80% of large employers and 70% of SMEs offer some form of retirement benefit (lump sum, defined benefit, or defined contribution pension). |
| 224 | |
| 225 | --- |
| 226 | |
| 227 | ## Section 7 -- Payslip Requirements |
| 228 | |
| 229 | Employers must provide a pay statement (給与明細書 kyūyo meisai-sho) each pay period under the Income Tax Act and Labour Standards Act. |
| 230 | |
| 231 | ### Mandatory Payslip Contents |
| 232 | |
| 233 | - Employee name |
| 234 | - Pay period and payment date |
| 235 | - Base salary (基本給) |
| 236 | - All allowances itemised (commuting 通勤手当, overtime 時間外手当, housing 住宅手当, etc.) |
| 237 | - Gross pay |
| 238 | - Deductions itemised: |
| 239 | - Health insurance premium |
| 240 | - Long-term care insurance premium (if applicable) |
| 241 | - Welfare pension premium |
| 242 | - Employment insurance premium |
| 243 | - Income tax withholding (所得税) |
| 244 | - Resident tax (住民税) -- withheld June through May |
| 245 | - Net pay |
| 246 | - Working hours and overtime hours |
| 247 | |
| 248 | ### Resident Tax (住民税) |
| 249 | |
| 250 | Resident tax is calculated by the municipality based on prior-year income. The municipality sends the employer a notification in May with monthly withholding amounts for June through the following May (special collection / 特別徴収). This is a flat amount per month, not percentage-based. |
| 251 | |
| 252 | --- |
| 253 | |
| 254 | ## Section 8 -- Filing Obligations |
| 255 | |
| 256 | ### Monthly Withholding Tax Payment |
| 257 | |
| 258 | | Employer Size | Due Date | |
| 259 | |---|---| |
| 260 | | Standard | 10th of the following month | |
| 261 | | Small employer (≤ 10 employees, with approval) | Semi-annually: 10 July (Jan--Jun) and 10 January (Jul--Dec) | |
| 262 | |
| 263 | Payment via bank transfer or e-Tax (国税電子申告 e-Tax). |
| 264 | |
| 265 | ### Year-End Adjustment (年末調整) |
| 266 | |
| 267 | | Task | Deadline | |
| 268 | |---|---| |
| 269 | | Collect employee declarations (扶養控除等申告書, 保険料控除申告書, etc.) | November--December | |
| 270 | | Perform year-end adjustment calculation | December payroll | |
| 271 | | Issue withholding tax slip (源泉徴収票) to employees | 31 January | |
| 272 | | File 法定調書合計表 (statutory report summary) to tax office | 31 January | |
| 273 | | Submit 給与支払報告書 (salary payment report) to municipality | 31 January | |
| 274 | |
| 275 | ### Social Insurance Reporting |
| 276 | |
| 277 | | Report | Deadline | Authority | |
| 278 | |---|---|---| |
| 279 | | 算定基届 (annual SMR determination) | 1--10 July | Japan Pension Service | |
| 280 | | 月額変更届 (mid-year SMR change) | Promptly upon qualifying change | Japan Pension Service | |
| 281 | | 賞与支払届 (bonus payment notification) | Within 5 days of bonus payment | Japan Pension Service | |
| 282 | | 労働保険年度更新 (annual labour insurance update) | 1 June -- 10 July | Labour Bureau | |
| 283 | |
| 284 | ### Penalties |
| 285 | |
| 286 | | Violation | Consequence | |
| 287 | |---|---| |
| 288 | | Late withholding tax payment | 5%--10% additional tax (不納付加算税) + delinquency tax (延滞税) | |
| 289 | | Failure to withhold | Employer liable for full tax amount | |
| 290 | | Overtime limit violation (36 Agreement) | Up to ¥300,000 fine or 6 months imprisonment | |
| 291 | | Failure to grant minimum 5 days paid leave | Up to ¥300,000 fine per violation | |
| 292 | | Failure to enrol in social insurance | Up to 6 months imprisonment or ¥500,000 fine; retroactive enrolment + premiums | |
| 293 | |
| 294 | --- |
| 295 | |
| 296 | ## Section 9 -- Common Payroll Patterns |
| 297 | |
| 298 | ### Pattern 1 -- Standard Monthly Employee (Tokyo, Age 35) |
| 299 | |
| 300 | Monthly salary ¥350,000. No dependents (甲 column, 0 dependents). Commuting allowance ¥15,000/month (non-taxable up to ¥150,000/month). |
| 301 | |
| 302 | 1. Health insurance: ¥350,000 × 4.925% = ¥17,238 |
| 303 | 2. Welfare pension: ¥350,000 × 9.15% = ¥32,025 |
| 304 | 3. Employment insurance: ¥365,000 × 0.50% = ¥1,825 (on total wages incl. commuting) |
| 305 | 4. Child-rearing support: ¥350,000 × 0.115% = ¥403 |
| 306 | 5. Income tax: per monthly table 甲, 0 dependents, ¥350,000 minus social insurance = ~¥8,250 |
| 307 | 6. Resident tax: per municipality notification (e.g., ¥18,000/month) |
| 308 | 7. Net pay: ¥350,000 + ¥15,000 - deductions ≈ ¥287,259 |
| 309 | |
| 310 | Employer additionally pays: ¥17,238 (health) + ¥32,025 (pension) + ¥1,260 (child allowance) + ¥403 (child-rearing) + ¥3,103 (employment ins.) + ¥1,095 (workers' comp) = ~¥55,124 |
| 311 | |
| 312 | ### Pattern 2 -- Bonus Payment (Summer/Winter) |
| 313 | |
| 314 | Employee with SMR grade ¥350,000 receives ¥700,000 summer bonus. |
| 315 | |
| 316 | 1. Health insurance: ¥700,000 × 4.925% = ¥34,475 |
| 317 | 2. Welfare pension: ¥700,000 × 9.15% = ¥64,050 (under ¥1,500,000 per-bonus cap) |
| 318 | 3. Employment insurance: ¥700,000 × 0.50% = ¥3,500 |
| 319 | 4. Income tax: per bonus withholding table (賞与に対する源泉徴収税額の算出率の表) -- rate based on prior month's social-insurance-deducted salary |
| 320 | 5. No resident tax on bonus (already covered by monthly flat amount) |
| 321 | |
| 322 | ### Pattern 3 -- Mid-Year Salary Change (随時改定) |
| 323 | |
| 324 | Employee's base salary increases from ¥300,000 to ¥350,000 in April. If the new SMR grade is 2+ grades different from the current grade, the employer files a 月額変更届. New SMR takes effect from July. Social insurance premiums update from the July payroll. |
| 325 | |
| 326 | ### Pattern 4 -- Employee on Childcare Leave |
| 327 | |
| 328 | Social insurance premiums (both employee and employer shares) are exempt during childcare leave. Employment insurance premiums are not charged on zero-pay months. The employee receives childcare leave benefits from employment insurance (67% for first 180 days, 50% thereafter). |
| 329 | |
| 330 | --- |
| 331 | |
| 332 | ## Section 10 -- Interaction with Other Skills |
| 333 | |
| 334 | | Skill | Interaction | |
| 335 | |---|---| |
| 336 | | payroll-workflow-base | Provides generic payroll processing steps; this skill adds Japan-specific rules | |
| 337 | | japan-bookkeeping | Payroll journals: salaries + ER social insurance to P&L; net pay + withholding tax + social insurance payable to BS | |
| 338 | | japan-consumption-tax | No consumption tax on salaries; commuting allowances are non-taxable for income tax but included in employment insurance base | |
| 339 | | japan-corporate-tax | Employer social insurance contributions and retirement allowance provisions are deductible expenses | |
| 340 | |
| 341 | --- |
| 342 | |
| 343 | ## Disclaimer |
| 344 | |
| 345 | This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this skill. All outputs must be reviewed and signed off by a qualified professional (such as a CPA, EA, tax attorney, or equivalent licensed practitioner in your jurisdiction) before filing or acting upon. |
| 346 | |
| 347 | The most up-to-date, verified version of this skill is maintained at [openaccountants.com](https://openaccountants.com). Log in to access the latest version, request a professional review from a licensed accountant, and track updates as tax law changes. |
| 348 |
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About
Use this skill whenever asked about Japanese payroll, income tax withholding (源泉徴収 gensen chōshū), social insurance (社会保険 shakai hoken), labour insurance (労働保険 rōdō hoken), or employer obligations in Japan. Trigger on phrases like "gensen choshu", "源泉徴収", "shakai hoken", "社会保険", "厚生年金", "kosei nenkin", "kenko hoken", "健康保険", "雇用保険", "koyou hoken", "労災保険", "rosai hoken", "年末調整", "nenmatsu chousei", "year-end adjustment", "standard monthly remuneration", "hyōjun hōshū getsugaku", "payslip Japan", "給与明細", "kyūyo meisai", "minimum wage Japan", "overtime Japan", "36 agreement", "子ども・子育て支援金", or any question about running payroll in Japan. ALWAYS read this skill before processing any Japanese payroll work.
JPty-2025
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