The Atarashift Blog
Insights for working in Japan
Guides, interviews, and honest advice for international talent building a career in Japan.
The Atarashift Blog
Guides, interviews, and honest advice for international talent building a career in Japan.
Japan's year-end tax adjustment settles your 2026 income tax in December. The forms to fill in, the proof to attach, and the new ¥1.04M deduction.
The year-end tax adjustment (nenmatsu chosei) is how your employer in Japan settles your income tax for the year. Each month, tax is taken from your pay as an estimate. In December, your employer works out the real figure and refunds or collects the difference. To get your deductions at the adjustment, you fill in a few forms and attach proof.
We analyzed the National Tax Agency's 2026 guide so you know what to expect. This year matters more than usual. The basic deduction for 2026 rose to as much as ¥1,040,000, but monthly withholding did not change before December. So the whole year's tax cut lands in one December adjustment, provided you hand in the right form.
Key Takeaways
- In principle, you're covered if you gave your employer the dependents form, still work there at year end, and your salary is ¥20 million or less.
- The basic deduction for 2026 is up to ¥1,040,000. To get it at the year-end adjustment, you must submit the basic deduction form.
- Monthly withholding through November 2026 used the old rules, so the raised deduction is settled in one go in December.
- Dependants living abroad need relationship documents and remittance records, translated into Japanese.
- Medical expenses, donations and a first-year mortgage credit are not on the year-end forms. You claim those with your own tax return.
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The year-end tax adjustment is a once-a-year reconciliation that your employer runs for you. In Japanese it's 年末調整, or nenmatsu chosei. The National Tax Agency (NTA) describes it simply. It settles the gap between the tax withheld from each paycheck and the tax you actually owe for the year.
Monthly withholding is only an estimate. It can't know about the life insurance you paid, a child who turned 16, or this year's change in the law. The year-end adjustment fixes that. The NTA notes that for most salaried workers, this finishes their income tax for the year.
So many employees in Japan never need to file a tax return. Your employer does the maths. Your job is to give it accurate forms and the right proof by the deadline HR gives you.
You are covered if you work for the employer at the end of the year and submitted the dependents form to it. That includes people who joined partway through the year. The NTA lists the main exceptions.
If you changed jobs this year, give your new employer the withholding slip (源泉徴収票, gensen choshu-hyo) from your old one. The new employer adds that pay to its own figures. Without the slip, it can't include your earlier pay, and you settle the year through a tax return instead.
Joining mid-year does not shrink your deductions. The NTA confirms you get the full basic deduction and dependant deductions, not a share based on the months you worked.
The FY2026 tax reform raised several deductions. In principle, the changes took effect on 1 December 2026 and apply to all of your 2026 income. Here are the four that matter for most employees.
The table compares the 2026 basic deduction with what 2026 would have been under the rules before this reform. "Total income" means all your income added up, with salary counted after the employment income deduction. The salary column shows the matching range when your only income is salary.
| Total income | Salary-only range | 2026 deduction (new) | Before the reform | Increase |
|---|---|---|---|---|
| Up to ¥1.32M | Up to ¥2.06M | ¥1,040,000 | ¥950,000 | +¥90,000 |
| ¥1.32M to ¥3.36M | ¥2.06M to about ¥4.75M | ¥1,040,000 | ¥880,000 | +¥160,000 |
| ¥3.36M to ¥4.89M | About ¥4.75M to ¥6.66M | ¥1,040,000 | ¥680,000 | +¥360,000 |
| ¥4.89M to ¥6.55M | About ¥6.66M to ¥8.5M | ¥670,000 | ¥630,000 | +¥40,000 |
| ¥6.55M to ¥23.5M | ¥8.5M to ¥25.45M | ¥620,000 | ¥580,000 | +¥40,000 |
Source: NTA, "Changes from last year" in the 2026 year-end adjustment guide. The amounts above ¥620,000 apply to residents of Japan only.
Here is what that means on a ¥5 million salary. Your employment income deduction is ¥1,440,000: 20% of salary plus ¥440,000 (Source). That leaves total income of ¥3,560,000, which sits in the third row.
So your basic deduction rises by ¥360,000. Income tax is 5% on taxable income up to ¥1,949,000 and 10% from ¥1,950,000 to ¥3,299,000 (Source). Depending on where your taxable income falls, the extra deduction cuts income tax by between about ¥18,000 (all at 5%) and ¥36,000 (all at 10%). A 2.1% surtax is charged on top of income tax (Source), so the full saving is slightly higher. This is our own estimate; your payslip will show your actual figure.
Because withholding through November used the old tables, that saving shows up in December. If nothing else changed, the December settlement will reflect that extra deduction.
HR usually hands out a packet of forms or a link to an online system. The names are long, so here is what each one does. The NTA publishes an English leaflet, About kinds of deduction for 2026, that explains each deduction.
| Form (Japanese name) | What it does | Proof to attach |
|---|---|---|
| Dependents form for 2026, 扶養控除等（異動）申告書 | Records dependants, disability, widow, single-parent or working-student status. Submit a change version if anything changed in 2026. | Documents for dependants abroad (see below) |
| Dependents form for 2027, same name | Next year's form, due before your first payday of 2027. Submit it even with no dependants. | Same as above if dependants live abroad |
| Basic, spouse, specified relative and income adjustment form, 基礎控除申告書兼配偶者控除等申告書兼特定親族特別控除申告書兼所得金額調整控除申告書 | Claims the basic deduction, the spouse deductions, the deduction for relatives aged 19 to 22 who earn a little, and an income adjustment for some salaries over ¥8.5M | Relationship documents and remittance records if your spouse or relative lives abroad (relationship documents already given with the dependents form don't need repeating) |
| Insurance premium form, 保険料控除申告書 | Claims life, medical, pension and earthquake insurance premiums, plus social insurance you paid yourself | Certificates from your insurers |
| Housing loan credit form, 住宅借入金等特別控除申告書 | Claims the mortgage credit from the second year onward | The form the tax office sends you, plus a balance certificate if your lender uses the certificate method |
The NTA's own page for employees carries a warning about this. To get the basic deduction at the year-end adjustment, you must submit the basic deduction form. If it's missing, you can lose the deduction worth up to ¥1,040,000 this year. On the form, estimate your total income for the whole year, including any side income.
HR may ask for next year's dependents form at the same time. It's due before the first payday of 2027. Skip it and your 2027 pay is taxed under the higher "otsu" (乙) column of the withholding table.
Attach the certificates your life and earthquake insurers send you. Keep them together as they arrive. Don't list social insurance already deducted from your salary; your employer has that figure. Only add premiums you paid yourself, such as national pension premiums.
Yes, but the rules are strict, and many foreign employees lose deductions here. Since 2023, a dependant living outside Japan counts only if they are:
A parent aged 30 to 69 who simply lives abroad and receives less than ¥380,000 from you does not qualify.
You also need two kinds of proof, each with a Japanese translation:
Three rules catch people out. Money sent to one family member doesn't count for another. If your spouse receives everything, your child abroad has no remittance record. Cash carried by a friend isn't accepted, because there is no document. Sent money more than three times to the same person? You can submit the first and last records with a short statement. Keep the rest. For the ¥380,000 test, add more records if the first and last don't reach ¥380,000 between them.
Most refunds arrive with your December pay. The NTA rule is that your employer refunds overpaid tax from the tax it withholds that month. If that isn't enough to cover everyone's refunds, the rest comes from later months' withholding.
If you paid too little, your employer deducts the shortfall from the same month's pay. Your December payslip or a separate statement shows the adjustment. Keep the 2026 withholding slip your employer gives you. You need it if you change jobs or file a tax return.
The year-end adjustment covers most people, but not everyone. Under the NTA's rules, you generally must file a return (確定申告, kakutei shinkoku) if:
Some deductions are not on any year-end form either. Medical expenses, donations and the first year of a mortgage credit are claimed through a return instead. If you must file, the period for 2026 income runs from 16 February to 15 March 2027. If you're only claiming a refund, you can file for five years starting 1 January 2027. Our guide to income tax in Japan for foreigners covers rates and take-home pay in more detail.
Nenmatsu chosei (年末調整) means "year-end adjustment". It's the December reconciliation your employer runs to match the tax withheld from your pay with the tax you actually owe for the year.
Yes. You still submit the basic deduction form to get the basic deduction, which is up to ¥1,040,000 for 2026. You also submit next year's dependents form, even if you list nobody on it.
Yes, if you're still employed there at the end of the year. Give HR the withholding slip from any earlier employer this year. You get the full basic deduction, not a share based on months worked.
If you become a non-resident partway through the year, your employer runs the adjustment when you leave. Tell HR your last working day early. If you're also claiming your pension refund, see our guide to the Japan pension refund.
Only if they meet the age and support rules above. A parent aged 70 or older can qualify. A parent aged 30 to 69 qualifies only if studying abroad, disabled, or sent at least ¥380,000 by you during 2026. You need translated relationship documents and remittance records.
For many employees, yes. Withholding through November 2026 used the old tables, and the raised deduction is applied to the whole year in December. On a ¥5 million salary, the basic deduction rises by ¥360,000. For most people at that salary, that cuts income tax by roughly ¥18,000 to ¥36,000.
Hand in every form, attach the proof, and check your December payslip. While you're sorting your paperwork, let employers find you too. Atarashift lets verified companies in Japan that hire internationally come to you. Upload your profile once and get scouted.
This article is general information, not tax advice for your situation. Figures are for 2026 income and were checked on 2 November 2026.
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