Gross vs. take-home, social insurance, income tax and resident tax — what actually leaves your salary in Japan, and why year two costs more.
Your offer letter shows a gross figure (額面), but the amount that lands in your account (手取り) is noticeably smaller. Between social insurance, income tax and resident tax, a typical employee loses 15–25% of gross before the money ever arrives. The deductions are not arbitrary — each one is a fixed rule you can calculate in advance. This guide walks through every line so the number on your payslip stops being a surprise, and points you to a calculator that does the math for your exact salary and city.
15-25%
typical total deductions
5
separate deductions
Year 2
resident tax begins
A handful of words appear on every payslip and job offer. Knowing them makes the rest of this guide — and your contract — far easier to read.
Your salary before any deductions — the headline number in a job offer.
What actually reaches your bank account after insurance and taxes.
Health insurance + pension + employment insurance, deducted together every month.
Income tax taken straight from your monthly pay, then reconciled at year end.
A banded version of your salary used to fix your health and pension premiums.
Your employer's December recalculation that refunds or collects any income-tax difference.
Five deductions account for almost the entire gap between gross and take-home. Rates below are the employee's share; your employer pays a matching amount for social insurance that you never see.
| Deduction | Employee rate | Notes |
|---|---|---|
| Health insurance (健康保険) | ~5% | About half of the ~10% total; the employer pays the rest. Varies by prefecture and insurer. |
| Pension (厚生年金) | 9.15% | Employer matches it. Frozen at 18.3% total since 2017; applied up to a remuneration ceiling. |
| Employment insurance (雇用保険) | ~0.6% | Funds unemployment and leave benefits. Small but always present. |
| Income tax (所得税) | 5-45% | Progressive. Withheld monthly, then trued up in the year-end adjustment. |
| Resident tax (住民税) | ~10% | Based on LAST year's income. Not deducted at all in your first year — see below. |
Social insurance is split roughly 50/50 with your employer, so the true cost of employing you is well above your gross. Pension and health premiums are set from your April–June average pay, then fixed for the year — a raise mid-year won't change them until the next September.
Resident tax (住民税) catches almost every newcomer off guard. Here is what to expect so it doesn't wreck your budget.
Roughly 10% of taxable income (a ~6% municipal + ~4% prefectural split), plus a small fixed per-capita amount. There is no progressive scale like income tax.
This year's bill is based on last year's income. Move to Japan in April and you pay zero resident tax in your first calendar year — the bill arrives the following June.
Once resident tax starts, the same gross salary yields a smaller take-home. Budget for a noticeable step down around your second June.
If you leave mid-year, you still owe resident tax assessed on the prior year. Many people appoint a tax representative or pre-pay before departing.
Freelancers, contractors and anyone not on a company's payroll fall outside 社会保険 and pay differently — and this is where your city matters most.
Instead of employer-shared health insurance, you pay NHI in full yourself. Premiums are set by your municipality, not nationally.
A flat monthly amount (about ¥17,000) rather than the income-linked 厚生年金 — far simpler, but with a lower future payout.
NHI rates differ sharply between municipalities — income rate, per-capita and per-household components all vary. The same income can cost meaningfully more in one city than another.
Our take-home calculator carries verified FY2026 NHI rates for all 20 of Japan's major cities, so a self-employed estimate reflects where you actually live — not a national average.
Now put your own salary through the calculator and see your real take-home.
