The percentage of pension contribution in salary
Japanese pensions and health insurances have their financial resources in two ways: one from national budget of Japanese government and another from contributions of residents in Japan.
Japanese employees pay contributions of pension and health insurances from their salaries in every month, that are withheld from their salaries by employers and paid collectively to the government.
The percentage of monthly contributions for Kosei Nenkin (厚生年金, employees’ pension insurance) is 9.15% of salaries. It means that about 9 in 100 of employees’ salaries is not handed down but withheld beforehand. Employees also need to contribute Kosei Nenkin from their bonuses (remunerations) at the same rate.
Relatively speaking, the burden of pension contributions is heavier for employees with middle or low level income than employees with high level incomes. The reason why is that contribution amount of Kosei Nenkin has its maximum. Employees with over 650,000yen’s monthly salary pay the constant contribution amount and don’t pay increasingly (except for bonuses. Bonuses have higher point of maximum).
Contribution ratio : Table
The table below is the contribution ratio in each level of monthly salaries:
| Monthly Salary (A) |
Contribution for Kosei Nenkin (B) |
Contribution Ratio (B/A) |
| 300,000yen | 27,450yen | 9.15% |
| 440,000yen | 40,260yen | 9.15% |
| 650,000yen | 59,475yen | 9.15% |
| 850,000yen | 59,475yen | 6.99% |
| 1,000,000yen | 59,475yen | 5.94% |
As it shows, Japanese employees pay Kosei Nenkin by a considerably high percentage.
So non-Japanese temporary employees can claim a payback of their pension contributions. It is called “Lump-sum Withdrawal Payments”.
Non-Japanese employees can claim their Lump-sum Withdrawal Payments within 2 years after leaving Japan. Lump-sum Withdrawal Payments will pay employees back their pension contributions of up to 5 years. They can receive them by Japanese yen or other currencies.
For Detailed Information..
- Employees’ Health Insurance System and Employees’ Pension Insurance System (Japan Pension Service, External Link)
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