iDeCo Tax Savings Calculator (個人型確定拠出年金)

iDeCo (Individual-type Defined Contribution Pension / 個人型確定拠出年金) is Japan's self-directed pension plan. Contributions are fully tax-deductible from your taxable income, meaning you save both national income tax and residence tax on every yen you contribute. A ¥23,000/month contribution for someone in the 20% income tax bracket effectively costs only ¥16,003/month after tax savings.

It depends on your employment category. Self-employed (Category 1): up to ¥68,000/month. Company employees without a company DC plan (Category 2): up to ¥23,000/month. Company employees with a company DC plan: up to ¥12,000/month. Dependent spouses (Category 3): up to ¥23,000/month. These limits are set by the National Pension Fund Association and adjusted periodically.

Both are excellent. iDeCo gives you an immediate tax deduction (saving 15–45% on contributions depending on your bracket) but locks money until age 60. NISA gives no tax deduction on contributions but all investment gains are permanently tax-free with no lock-up. The ideal strategy: use both. Max iDeCo to reduce current taxes, then fill NISA for flexible tax-free growth.

Yes, any resident of Japan paying into the national pension system can open an iDeCo account. If you leave Japan permanently, you can withdraw the full balance (lump-sum) regardless of age — but it will be taxed as ordinary income in your final tax return. Alternatively, you can leave the account and withdraw from age 60 onward, even from overseas.

At age 60, you can begin withdrawals. You have three options: lump-sum (退職一時金), pension installments (年金), or a combination. The lump-sum is taxed as retirement income (退職所得) with a generous deduction — typically ¥400,000 per year of contribution (minimum ¥800,000). For most people, this means little to no tax on withdrawal.