The Japanese Government has a system where foreigners leaving Japan, who have been paying into the pension system, can receive back a portion of these payments. This is known as a “National Pension Payment Rebate”, or a “Lump-sum Withdrawal Payment”. After all those hard years slugging it out working in the far east, you deserve to get back as much of that money as you possible can (it’s not like you are going to retire here right?). We have provided a “Dummies Guide” to getting as many of those hard earned yen that you have paid into this country’s convoluted pension scheme put back into your pocket where they belong, this is a must read for all foreigners thinking of leaving Japan soon, or have recently left Japan.
To set the ground rules, this is only applicable to foreigners actually leaving Japan “permanently”, and is a generous loophole. It is mandatory in Japan for all those employed to make monthly pension payments, and for full-time employees of companies it is automatically deducted from monthly salaries (as opposed to contractors who are required to make the payments themselves). However, how many of us will actually be in Japan long enough to receive a pension? (Yeah.. I thought so.)
Many people have heard that this rebate may exist, but due to the difficulties of understanding the Japanese bureaucratic system, as well as language difficulties, coupled with the fact that this is not widely publicized, we at stippy.com believe that the number of people exploiting this payback system is extremely low (which is exactly how the government wants to keep it mind you).
The Main Point:
Foreigners who have made monthly pension payments can receive back a portion of these payments once they have lost the right to receive such payments, and left Japan. The application for pay-back must be made within 2 years of leaving Japan.
* Note: There are two types of pension systems- the National Pension System （国民年金） and the Employee’s (or Corporate) Pension System （厚生年金）. You can receive rebates from either of these systems, however this article will focus just on the National Pension System. Also, this rebate system does not apply to mandatory health insurance, or other social security payments.
The Conditions for Application:
- You must not be a Japanese citizen (You probably wouldn’t be reading this if you were, but anyway..)
- You must have been enrolled in and have been making pension payments for more than 6 months
- Must not have an address in Japan (“Having an address” in Japan is often important for companies and Government agencies to do business with you – See comments below)
- Must have not already received any pension payments (including disability allowance)
Payment Amounts:
If your last pension payment was made before March 2007, your rebate amount will be according to the following table (click table to see a bigger version):
However, if your last payment was April 2007 or later, things get slightly tricky and the calculation is as follows (click image to see a bigger version):
* The reason for the two different calculations is that until March 2005, mandatory National Pension payments were fixed at 13,300 yen. However from April 2005 the rates were increased, and are planned to be increased each April for the foreseeable future. The current payment amount as of October 2006 is 13,860 yen per month.
The Process and the Tricky Parts (YOU MUST KNOW THIS BEFORE LEAVING JAPAN):
- You must apply from overseas. The application form is available only at your local city/ward office (市役所, shiyakusho or 区役所, kuyakusho), or online here. It can only be filled in by the applicant. You need to submit your pension booklet (showing pension payments, or the equivalent proof of pension payment issued by your company), a copy of your passport, and bank account details with the application form.
- The National Pension payment rebate is exempt of the 20% income withholding tax which applies to the Corporate Pension systems.
- Payment is made into the bank account of your choice. This account can be in Japan, or overseas, and will be made at the exchange rate of the day of payment for overseas accounts.
Further Notes:
Having an Address: Most companies and Government agencies will not do business with you unless you have a registered address. However, this is a loose concept and can work both for and against you.
For example, Japanese securities companies won’t give you a trading account unless you have an address in Japan. If you then leave Japan, all you need then is a friend who is happy to receive mail for you.
To receive your pension rebate, as long as you don’t own property here and don’t put forward any other address, you should be fine.
Aggregated Pension Schemes: Many countries have an Aggregated Pension Scheme Agreement with Japan. This means that applications may receive two countries pensions by summing the enrollment period in each country’s National Pension Systems. Such countries currently include the US and Germany. (France, Canada and Australia are in negotiation to start up similar agreements).
However if you receive a “National Pension System payment rebate”, then you will not be eligible for this. Receiving this payment effectively nullifies your enrollment in the system.
For further details, contact your local Ward Office. And good luck!
I am returned from Japan to my home country and applied for getting back the pension. will anybody tell me that generally how much time it takes to get the pension back.
From what I am reading here, all I can say is this. The Japanese pension system is the most flawed and most unjust and unscrupulous system ever. Even the Koreans can do better than Japan. When I was in Korea, I payed US$1000 a year for my pension deducted from my monthly salary. I spent 3 years in Korea so my pension multiplied to the value of US$3000. Even better, they matched it. I payed US$3000 over 3 years, and I took out the value of US$6000 of my pension in Korea.
I just started working here in Japan since the past 3 and a half months. I am only paying income tax, I have no pension. I cannot afford to spend a long time in my life in Japan like this. If I am going to pay a certain amount of yen per month for my pension, and I cannot get back all I put in, nor ccould I invest that much money in my pension here in Japan, I guess I should go back to Canada or return to South Korea. Because this makes me wonder whether or not I am wasting my time in Japan. If I get old and remain penniless because of the lack of pension working here in Japan, I might as well be dead.
The Japanese pension system is the most unscrupulous pension system ever! I guess the Yakuza is to blamse for this right?
@There and back again
Being a permanent resident just means not having to go visit immigration every 3 years to renew your visa, and you’re already considered a permanent tax resident if you’ve worked in Japan more than a year – but don’t get the 2 confused.
Yes, you would have to relinquish your residency in order to claim the lump sum withdrawal, as you cannot be resident in Japan, which you would be as a permanent resident even if you’ve been out of the country 5 years.
@Sheldon
The Japanese pension system is tailored for Japanese, so to them it does not seem so, umm, unfair? haphazard? ridiculous? unscrupulous?
As was posted waaaaay up near the top, while the monthly payment is small, it continues until you die – which for the Japanese could be another 40 years after retirement!
But no-one ever expects people to live off just the national pension – in any country – that’s why most have additional pension plans – which kind of got screwed up by the wall street crash, with their 401k’s ended up being essentially worthless.
@Everyone 🙂
At the end of the day, if you feel you will need, say, 500000 Yen a month at retirement to live in the style you’re accustomed to, you best get saving. Government bonds are usually a good choice – safe but no big returns.
And yeah, if you haven’t sorted out your long term pension and retirement plans by the time you’re 20, you’re starting late and need to get a move on, or you’ll find those monthly payments are gonna get big.
I have done all the applications and I got the approval letter from the pension people today, it took about 4 months to process, I’m glad its almost over. The refund is post dated for the 13th of January, it says I will receive payment several days after this date. Does anyone have any idea how long the bank account transfer usually takes? I’m in the UK…
For those hoping to get your pension without paying local tax: yes, it is possible and yes, it can be deposited directly to your U.S. bank account. Just send in the standard papers.
Hello,
Does anybody know where there is official documentation showing you can only receive the lump sum withdrawal once? Either Japanese or English is okay.
Hello there…
I’m hoping someone here can help me. Any Canadians here?
I’m Canadian. Worked 5 years in Japan under the JET Programme. Went back home to Canada for good 2 years ago… I received both pension lump sum and withholding tax refund last year…. I understand that both of these are income that are UN-taxed in Japan (correct??), and therefore I have to claim the pension lump sum as “foreign lump sum pension benefits” (taxable income)… and then since I received refund of the withholding tax, I can claim this as “foreign income-other”. I can’t really claim this pension as tax-exempt (Japan-Canada treat) because I never paid taxes on my pension in Japan (wrong??)
Is the above accurate?
I’d like to be sure before I pay the Canadian government over a thousand dollars worth of income tax owing 🙁 this is totally my fault really….
Please help 🙁 Thank you so much in advance….
How would I know if I already get my tax return money? I mean, what particular bank would the money be coming? Just to make sure that it is really my tax return?
Could anyone try to help me.
Thanks in advance,
How would I know if I already get my tax return money? I mean, what particular bank would the money be coming? Just to make sure that it is really my tax return?
Or is there any notification that will be send to me?
Could anyone try to help me please.
Thanks in advance,
I read through this thread after already applying for the rebate. Quite stressed myself and need the money badly. I have been back in London for 7-8 months but only applied for the rebate 2 1/2 months ago. Called them this morning (I did speak in Japanese) and managed to find out the “plan” is to send it on 13th July. This will have taken 4 months.
As a bit more info after working for 4 1/2 years with an American investment bank earning around 8.5M JPY a year I will get 1.5M JPY (gross before W/H tax) as a rebate between the 2 components. This is not bad as it combines with about the same again that I got back from the company’s private pension.
It may have come quicker as I applied nearly 5 months after I arrived back.
I had given up my Alien Registration Card at the airport on leaving which also cancelled my visa.
I can also confirm that Nova (where I once worked) and probably all private English schools do not pay it. As I understand from a company owner friend it is not a legal requirement to pay it so naturally most schools do not. From all my time in Japan prior to being a company employee I was a contract worker and never got the pension.
@ Andy,
You said you received a 900,000 yen rebate as a former 3-year JET (comment 287 above). Is this figure correct? It seems you should have received closer to 300,000. My first 3 years in Japan were spent working as a JET, too (I guess I should hope you were not mistaken!).
Thank you for addressing my previous question last year. Cheers – Kirk
I was enrolled in a private school pension system for a long time. I then went into the national system for two years. Can I get back part of the private school pension system money? Also, my ex-wife has my pension book and claims she doesn’t know where it is. What should it do? I have most of my pay stubs from the job where I was in the national pension system. What should I do?
Thanks.
I worked in Japan from April 2008 to July 2012. By end of July I left Japan and sent my application for lump sum withdrawal in the beginning of August, so far I didnt hear anything. One setback I am afraid of is I have changed my residence address since my application, could it be a problem for the tax office reach me in case some thing happens? or can I call and tell them my current address? what is the procedure if you have experience.
Regards
Hi, if you exceed the two-year deadline for applying for a lump-sum payment, but come back to Japan and register at the shiyakusho (as either a short-stay visitor or on a work visa), would that give you the opportunity to apply again? Many thanks
I have been living in Japan for 6 years since 2007. I worked for a company in Japan during 2008-2009, and pension was deducted from my salary every month during those periods. However, I haven’t paid pension after 2009 as I become part-time worker or unemployed for some period of time.
Now I plan to leave Japan permanently and wonder if I can apply for lump-sum withdrawal. As my last payment for pension was in 2009, I am not sure if I am still eligible for this refund.
And if I can apply for reimbursement when and how can I apply? Should I apply in Japan just before I leave? Or should I apply after I leave Japan, but in this case how can I do that when I am outside Japan?
Any advice would be appreciate.
I was a 5 year JET and returned in August 2012. I applied for my pension as soon as I returned and I still have not received it. It is now almost May 2013. I had received a letter in January 2013 asking if I still wanted the refund (I am not joking). A lot of my friends have also not received their refunds. At this point I’m beginning to wonder if they are waiting for the market to drop. If they had sent the refund in November or December 2012 we are talking a significant amount more money. The exchange rate was about 80 yen to the dollar then and now it is 100 yen to the dollar. I’ll let you do the math, but with a 3 year pension refund that is a hell of a lot more money. Someone suggest to me that it wouldn’t make a difference to them because they are send a set amount of yen, but I’m not so sure it’s that simple. It’s just suspicious to me because out of the 5 years I was on JET everyone I ever talk to about getting a refund said they got theirs 6 months at the latest. Anyway, is it just a fluke with me and my friends or are other people having trouble this year with a long wait for a refund?
@Toasted Banana
I was a JET from 2003-2006 but stayed in Japan until 2012, and so just applied for the pension refund back in early December.
I received the money in March.
I don’t think the weak yen should affect the pension (although it sucks that I didn’t get as much back in Aussie dollars as I might’ve a few years ago!).
If your Japanese is good enough I guess you could try and call the pension office in Tokyo or something?
I called last month, they just apologized and said I would have to wait a few more months. Apparently all the paperwork is in order so I can’t imagine what is taking so long. About 10 out of 15 of my friends who left at the same time and applied for pension at the same time received theirs the 7th or 8th month after applying, but I’m still waiting like a few of my other friends. Maybe the prefecture got something wrong and it’s a big mess… who knows. Like I said, it took 5 months for them to simply send me a letter double checking if I wanted it, so I guess they are just taking their time.
Hi everyone, I need some help! My two year deadline for submitting my pension refund application was 2 July. I mailed my application from the UK with recorded delivery on 22 June. I received a letter from the pension service today saying everything was fine but they needed to see that I left Japan on or after 5 July 2011 because 5 July 2013 is the date they appear to have received it! Don’t know why it took 13 days to get there! Do I have any hope of getting my money??
Hi,
I want to ask.
I have recently returned to my home currently and I applied for my pension refund. If I decide I want to go back to work and live in Japan, is there a time limit for how long I have to be out of Japan; due to applying for the pension refund?
Or can I just return to Japan if I find a job?
I leave japan for almost ayear now(5may14)and send my application for lumpsum emmidiatelly but until now no response from pension office. I am not paying my pension plan since 1997 so i decided to claim the lump sum i have no plans to get older in japan nor wait for my 65birthday working neither . But i dont want to loose my Recidency in japan what should i do. Im 54 years old now.
Hello – this seems to be a very helpful blog. And I do have a dilemma and am trying to figure out what I can do. I appreciate any advice and help.
I am 58 now (been here 5 years) and plan to stay here until I reach age 66, then return to the U.S. to fully retire. I am now contributing (mandatory) to a pension plan through my employer. So I am category 2. I will not be working 25 years as required to get a pension. My questions and concerns are these:
I want to continue to teach here until age 66. So at age 66 after my return to the U.S. , I will immediately apply for this lump sum withdrawal payment. Is it okay for me to do that at that age? I think that is over the age for full pension in Japan; I believe that age is 65. Again, I will never actually be able to qualify for a pension as I will not work 25 years here. So I do not think I need worry about the age when I request the refund. But I would like to know for sure.
Second, does anyone know for SURE (here is my stress and worry) that this lump sum partial refund of my contributions towards this pension plan definitely will NOT trigger the Windfall Provision (part of U.S. law). The Windfall Provision is only regarding getting an actual pension, if I qualify and get a real pension. As I do not qualify for an actual pension, and this is merely a partial refund of the last 3 years (from what I have read, I think that is the amount of time involved) of my contributions (not my employer’s matching part), it is a lump sum payment not an actual pension. I will not get a pension.
Does anyone know enough about the Windfall Provision (U.S. law) to help me? I cannot have my already small (not kidding) future Social Security check reduced because the U.S. government would consider the lump sum paid to me a pension … even though I do not qualify and could not get a pension in Japan based on the years I have worked. I will need to live off of my Social Security check only when I retire.
I would sincerely appreciate any feedback concerning this particular concern: most importantly, the Windfall Provision regarding the lump sum payment even though it is not a pension, and my age at leaving Japan to request a lump sum withdrawal payment.
My very sincere thanks to anyone who can respond to help me with this.
Hi there, can you help?
I worked 2 years at a school & paid pension every month. I was given my blue book by the school office before I left, but nothing is written inside apart from the pension number & name & so on. Should there be a record of my pension payments? Am keen to know this before I send the form off.
Any help is appreciated! Thanks
where are folk getting all these numbers from on their pension rebate, there is actually a fixed maximum amount you can get back up to 3 years. Unless Im reading it all wrong 🙁
I still don’t understand about the income tax thing. So I have to wait after the pension comes then who is appointed to what? Please help. I’m leaving soon.
Hello there, can you help? I worked as a trainee welder at Hitachi Construction Machinery at Ryugasaki-shi Ibaraki-ken Japan for 3 years. I was given my Pension Handbook(bluebook) by the Company when I left Japan on Feb.19,2015. I unintensionally lost the handbook at the NAIA terminal 2 comfort room and was not recovered until now.Iwas not able to get the Handbook number which is very important in claiming my lump-sum. I already sent letter to Japan Pension Service regarding my situation, can you please help me in getting another copy of my Pension Handbook?
Hi John Reeve, The official info about claiming the Japan Pension Lump Sum is here: http://www.nenkin.go.jp/n/www/english/detail.jsp?id=52
I’m a Canadian citizen and worked in Japan in the early 1990’s. My situation is that my company had told me way back in 1993 when I left that I would have to wait until I was 65 years old to claim back the Japan Pension. So I’m concerned that I might be too late to claim now.
And unfortunately since then, I have lost (or never received) my Japan Pension Passbook and my Employee Health Insurance Number. Furthermore, my former bank has been acquired and I no longer have the bank account details, other than the bank address.
The good news is that I still have my Japan Alien Registration card, a letter of reference from my former employer and they’re still in business.
If anyone can point me to a Japan Pension tax refund advisory service that can help, please let me know.
I’ve heard of the following resource that’s in Japanese. For others who are still in Japan, this association might be able to help.
http://www.shakaihokenroumushi.jp/general-person/pension/
i hope someone will help me about my worries cause of lump sum, can i still get a lump sum, even though i still live in japan cause of my husband, who has an order here, he is a us navy stationed in yokosuka, and my visa just got terminated and im under sofa now..
Whhat kind of bank account number am I supposed to fill in the form? The international IBAN number or the local bank account number (I’m from the Czech Republic). The paper doesn’t say anything about it.
Thanks for reply.
i am from india anybody can tell me where i can apply lump pension and what is procedure to recieve