How to Read Your Japanese Payslip (給与明細)

Receiving your first salary in Japan can bring a mixture of excitement and confusion. When you look at your Payslip (Kyuyo Meisai - 給与明細), you will find that the difference between your gross pay and actual take-home pay is significant. This guide breaks down every section line by line, explains what each deduction means, and gives you a worked example so you can sanity-check your own payslip.

The Three Main Sections of a Payslip

Every Japanese payslip is divided into three core categories: Attendance, Payments, and Deductions. Some slips include a fourth 'next month' column showing projected amounts.

• Attendance (勤怠 - Kintai): Records your working days, hours, paid leave days used, and overtime hours.
• Payments (支給 - Shikyu): Lists all components of your gross salary, including base salary (*Kihonkyu*), commute allowance (*Tsukin Teate*), housing allowance, qualification allowance (shikaku teate), and overtime pay.
• Deductions (控除 - Kojo): The taxes and social insurances withheld directly from your pay.

Item-by-Item Breakdown: Payments (支給)

The Payments side of the payslip shows everything that adds to your gross. Typical items:

• Kihonkyu (基本給) — Base salary: Fixed monthly salary.
• Tsukin Teate (通勤手当) — Commute allowance: Usually non-taxable up to ¥150,000/month; reimburses your train pass.
• Zangyo Teate (残業手当) — Overtime pay: 1.25x hourly rate for standard overtime, higher for late-night and holiday work.
• Shikaku Teate (資格手当) — Qualification allowance: Bonus for holding certifications relevant to your job.
• Kaju Teate (住宅手当) — Housing allowance: Common at large companies.
• Kisai Teate (記載手当) / Other allowances: Family, position, etc.

An important nuance: the commute allowance (Tsukin Teate) is classified as non-taxable income, meaning it is not subject to income tax or residence tax, and it is also exempt from social insurance premiums — as long as it does not exceed ¥150,000 per month. If your actual commute cost exceeds this cap, the excess is taxed as regular income. This is why your taxable salary (課税支給) is often lower than your total gross payments (総支給額).

Understanding Deductions (控除 - Kojo)

The deduction section is usually where expats have the most questions. These deductions represent social security obligations and taxes, and they typically consume 20–25% of your gross salary:

• Health Insurance (健康保険 - Kenko Hoken): ~9.9% of standard monthly remuneration, split 50/50 with your employer (so ~4.95% withheld). Covers medical costs — you pay only 30% at clinics and hospitals. Includes the new 2-year 'Covid recovery' surcharge ending in 2026.
• Employees' Pension (厚生年金 - Kosei Nenkin): 18.3% of standard monthly remuneration, split 50/50 (9.15% each side). FundsWithdrawable via lump-sum refund when you leave Japan.
• Employment Insurance (雇用保険 - Koyo Hoken): Small premium (typically 0.6% for general industries, lower for some) that funds unemployment benefits, childcare leave, and vocational training subsidies. Employer also contributes.
• Income Tax (所得税 - Shotokuzei): National income tax, calculated dynamically based on your current month's taxable income and the number of registered dependents. Updated for the 2026 (Reiwa 7) reform — see below.
• Residence Tax (住民税 - Jumizei): Local municipal tax of ~10% of your previous year's taxable income. For your first year in Japan, this is ¥0 because it's based on prior-year Japan income.

Detailed Breakdown of Health Insurance (Kenko Hoken)

Health Insurance is the largest social insurance deduction after Kosei Nenkin. The rate varies slightly by insurance society (Kyokai Kenpo, IT Health Insurance Society, etc.), but the employee-borne share is typically 4.95% of your Standard Remuneration Monthly Amount. This premium also funds:

• Health insurance benefits: 70% coverage of medical bills. You pay 30% out of pocket at clinics and hospitals.
• Health Insurance Bonus (Shussan Ikuji Ikkatsu): A lump-sum ¥420,000 for childbirth or adoption.
• Sickness and Injury Allowance (Shobyoteate): If you are hospitalized and cannot work for 18+ months, you receive two-thirds of your salary.
• Bereavement Allowance (Sosoteate): ¥10,000–¥30,000 paid on the death of a dependent.

The 9.9% rate is split equally between you and your employer. The rate is applied not to your actual monthly salary but to your Standard Remuneration Monthly Amount (標準報酬月額), a graded figure set by your employer based on your average monthly compensation. This means your health insurance deduction stays constant month-to-month even if your actual pay fluctuates slightly due to overtime.

Year-End Bonus Tax Adjustment

In Japan, summer and winter bonuses are typically subject to a separate, simplified tax calculation rather than the progressive monthly withholding rate. The bonus withholding rate is a flat 7.661% (for bonuses exceeding ¥1,000,000, the portion above is taxed at a higher rate). This is why bonuses feel 'less taxed' than regular salary — and why the Year-End Adjustment in December is so important. It reconciles any under- or over-withholding across the entire year, including bonus months.

Year-End Adjustment vs. Final Return (Nenmatsu Chosei vs. Kakutei Shinkoku)

Each month, your employer withholds estimated income tax based on a simplified formula. In December, they run a Year-End Adjustment (Nenmatsu Chosei - 年末調整) to reconcile the differences — claiming deductions you submitted (life insurance, mortgage, dependents, etc.) and either refunding underpaid tax or clawing back overpaid tax through your December or January pay.

If you earn more than ¥20M/year, have side income over ¥200,000, or have multiple employers, you must instead file your own Kakutei Shinkoku (Final Return) between February 16 and March 15. Use our Income Tax Calculator to estimate your true annual liability before filing season.

Social Insurance Rate Changes (2024–2026)

• Health Insurance: The COVID-era reduced rate (0.18 percentage points lower) ended in March 2024; the full rate resumed, then a temporary 2-year recovery surcharge was added.
• Kosei Nenkin: Contribution rate stable at 18.3% since September 2020; no changes planned through 2026.
• Income Tax (2026 Reform): The Reiwa 7 tax reform introduces a dynamic basic deduction that phases out at higher incomes, raises the minimum employment income deduction to ¥650,000, and changes dependent calculations for national vs. local tax.

Sample Payslip Walkthrough

Imagine a single 30-year-old expat with no dependents earning ¥350,000/month in gross (including commute). Here is what a typical month looks like:

• Gross (Total Payments): ¥350,000
• Health Insurance (4.95% of ~¥320,000 standard remuneration): −¥15,840
• Kosei Nenkin (9.15% of ¥320,000): −¥29,280
• Koyo Hoken (0.6%): −¥2,100
• Income Tax (estimate): −¥8,400
• Residence Tax (¥0 first year; ~¥17,000 from year 2): −¥0 / −¥17,000
• Net take-home (year 1): ~¥294,380
• Net take-home (year 2+): ~¥277,380

Bonus Month Walkthrough

Now consider the same expat receiving a summer bonus of ¥600,000 in addition to regular salary. Here is the breakdown for that month:

• Regular Salary (as above): ¥350,000 gross → ¥294,380 net (year 1)
• Bonus Gross: ¥600,000
• Health Insurance on bonus (4.95% of standard bonus ¥600,000): −¥29,700
• Kosei Nenkin on bonus (9.15% of standard bonus): −¥54,900
• Employment Insurance on bonus (0.6%): −¥3,600
• Income Tax on bonus (flat 7.661%): −¥45,966
• Bonus Net: ~¥465,834
• Total Month Net (salary + bonus): ~¥760,214

Note that the social insurance percentages apply identically to bonuses as to regular salary — 9.15% for Kosei Nenkin, ~4.95% for Health Insurance. Only the income tax treatment differs, using the flat bonus rate. This is why a ¥600,000 bonus gross yields about ¥466,000 net, a 22% deduction rate — similar to your regular monthly effective rate.

Residence Tax (Jumizei): The 'Surprise' Deduction

Of all the deductions on a Japanese payslip, Residence Tax (住民税) catches the most expats off guard. Unlike income tax, which is withheld from your first paycheck, Residence Tax is based on your previous year's Japan-source income and is collected starting in June of the following year. This creates a one-year lag:

• Year 1 (January–December): You earn ¥5,000,000. Residence Tax on this income is ¥0 during the year — it has not been assessed yet.
• June of Year 2: The municipality calculates your Residence Tax as ~10% of your Year 1 taxable income. Monthly deductions of approximately ¥41,600 begin and continue through May of Year 3.
• Year 3: You pay Residence Tax based on Year 2 income. The lag continues as long as you live in Japan.

If you leave Japan mid-year, you still owe Residence Tax for the full prior year. Your employer is required to withhold a final lump sum from your last paycheck, or you must pay the balance via your Tax Representative. This is a common source of unexpected deductions for departing expats.

iDeCo and Furusato Nozei on Your Payslip

If you participate in iDeCo (個人型確定拠出年金) or Furusato Nozei (ふるさと納税) with the One-Stop Exception, you may see adjustments reflected in your Year-End Adjustment rather than as line items on your monthly payslip. iDeCo contributions lower your taxable income, which in turn reduces your income tax withholding from the month your employer begins processing them. The same applies to Furusato Nozei under the One-Stop system — the deduction reduces your Residence Tax rather than appearing as a payslip line.

To estimate how iDeCo contributions affect your monthly take-home pay, use our iDeCo Calculator. For Furusato Nozei planning, the Furusato Nozei Calculator shows your donation limit and tax savings.

Take-Home Pay (差引支給額 - Sashihiki Shikyu-gaku)

This is the final figure transferred to your bank account — calculated as Total Payments minus Total Deductions. Typically, your take-home pay is around 75% to 85% of your gross salary. If you are comparing job offers, always ask for the *net* (sashihiki) figure, not just the gross — the gap is bigger than most expats expect.

For a detailed breakdown of how social insurance rates affect your net pay across different salary levels, refer to the Japan Pension Service guide and the Ministry of Health, Labour and Welfare's annual social insurance rate announcements.