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!
So does that mean we don’t get it all back? How much do we pay anyway? Does that mean that the refund is not set as a % of what we paid but at a fixed amount (so your rebate has nothing to do with what you actually paid).
In answer to those questions:
– You dont get it all back. Sorry.
– As far as I understand it, the amount everyone pays is fixed, irrelevant of income. And up until last year, it was 13,300yen/month. (Apparently if you send an angry spouse in though, the Pension Section of your local ward office may negotiate with you though.)
– The rebate is a certain percentage of this, which calculates to the above numbers. Thus, it is fixed. The variable, and what makes it increase, is the number of months you have paid it for.
That make sense?
Although it is commonly believed that it is mandatory to join the National Pension system, is there actually any punishment if you dont register with the National Pension system?
Or is it the same as paying NHK fees? Its “mandatory”, but no legal recourse against those who dont pay?
Actually taxman, you don’t need to pay it at all if you do the proper procedures.. See here:
http://www.sia.go.jp/top/gozonji/gozonji02.htm
But, this only works if you can prove that you can’t pay.
If you just didn’t pay even when you could, and you tried to get a “real job” after that, then you would look like a real dick at your new company, as they would find out that you havn’t been paying and it would leave a terrible first impression.
Other than that, I don’t think there is a fine for not paying. I think you just loose any chance of getting pension in Japan, or if you have an accident which leaves you incapacitated (in which case, you would get pension earlier).
I have spoken to the city office about this before, but one thing that seems a little unfair is the fact the rebate appears to be capped at 36 months of contributions. As someone who is staying here for the mid-long term, paying a pension is a bit of a gamble, because I will lose most of it if I decide to leave in 10-15 years. As long as it is not compulsory, I figure I am better off covering myself privately.
However, with the system falling to pieces, its probably only a matter of time before they kick my door down and take my money.
Sorrydaijin, I agree. Why should there be a 36 month cap? Is that some kind of hint as to how long you are welcome?
The more I look at this system, the more of crazy it seems to be. Without company contributions into an employee’s pension, the National Insurance payout is a pittance.
Believe it or not, if you pay into the system to 30 years, the amount you will receive once you meet the eligible age is… wait for it… a measly 580,000 yen a year! That comes to about 60,000 yen per month.
At the current rate of 13,860 yen/month, for 30 years= approx 5,000,000 yen total. And you get just over a 10th of that back per year.
Therefore, after 10 years of retirement you will be feeding from someone else’s contributions. And with the population feeding into the system Japan decreasing, there seems to be a fundamental problem with the numbers…
And at any rate, from the perspective of those paying into the pension system, why bother? And if there is no legal punishment for not joining, whats the point?
Did this system used to be a percentage of what you have actually paid? I heard several years ago that you get back almost all of what you paid into the scheme if you leave it within 3 years. If you leave after working more than 3 years, you get back three years worth.. Was that true, and things have changed? Or did my source not know wtf he was talking about..?
I worked in Japan for 5 years and then was transfered and still employed by a Japanese company (and therefore still paying my pension) while I was in the UK. I quit working for the company while I was in the UK. It was all VERY complicated and I’m not sure how it all worked, but my company pension gave me back some money (I guess about 40man + 30man), and then I was given some forms to fill in for the national pension. I had to send these to an address in Japan along with a copy of my exit stamp from Japan and proof of my bank details. Two months later, voila! 43man turned up in my bank account!
Hannah
Yeah, I heard about the 36 month cap as well. It raises the question of whether or not it’s worth the effort getting it back if you’ve been here for any longer than that. It seems like a lot of effort for a tiny fraction of what you’re paying in if you’ve been here for the better part of a decade.
I think if you’re going to be here medium term (longer than the three year cap, but less than the 25 years required to recieve pay outs on retirement) then you’re best bet is to give up on claiming the reimburesment and instead pray for an “aggregated pension scheme” between Japan and wherever you happen to be moving to next. At least that way you would get something a bit more substantial out of youre payments.
Regarding Taxman’s statement that “after 10 years of retirement you will be feeding from someone else’s contributions”, I think that’s the whole point of the system. The whole thing is a Ponzi Scheme thought up in the decades after WWII when the fertility rate was 3~4 per woman. Obviously with 高齢化 and 少子化 showing no signs of abating, this doesn’t apply anymore. Look for an increase is the age where you can begin recieving payouts, or a decrease in the allowance, or a combination of them if the pension scheme is to survive.
Hi Gold, I know I’m stretching the link on the pension scheme here but I have a question for you about the local ward office. A friend of mine recently left Japan in a hurry, leaving me with his scooter. I’d love to ride it around but have no idea how to register the thing. Any idea who I should be talking to? Do I need to pay anything to the national coffers for the pleasure?
I am one of those people who worked in Japan for a long time, received the lump-sum rebate after returning home, and now am BACK in Japan…what does the National Pension scheme do with me here this time? Once out always out? Do they start me over? Just curious. Love your website.
Returnee, welcome back to Japan…
At a guess, I reckon they will start you over. And especially so if you live in a different ward to last time. Each ward doesnt talk to each other, so if youre in a different one, theyll open a new file for you, and have no record of your past. Having said that, I think the fact that you moved away and claimed the rebate means that your file gets closed, so even if youre in the same ward they will open a new file. Hope this helps…
Returnee, you also want to look into how much income tax you’ve paid, when and to who. The tax laws for foreigners changed last year so it is much harder to be eligible for the low gaijin tax rate if you’ve lived in Japan during the past five years (even if you’ve had a blank)
I applied for my refund back in May 2007 (its now September) and I hear it takes 6 months, but I’ve started to think “I wonder if they even have my application…” – Is there any way of finding out if they are even got it and are processing it?
Also – I worked for 3 years on JET – then got another job for 6 months that didn’t pay in to the pension scheme – will that effect the amount I get refunded?
Its so confusing!
ExPat Japan Community
http://www.oldsushi.com
My husband’s and my pension payments were paid by his company last year when he was full-time. Now we’re both part-time, so no one is paying our pension payments currently. I got a form from the pension office in the mail (my husband didn’t get one as far as we know) which asked me to fill out the info so (I presume) they could start collecting pension money from me. I went in once to ask about it, but didn’t understand enough of what they were saying, so said I’d come back with a friend. Now after reading your helpful site, I wonder if I need to go back since the payments aren’t technically required…? If it’s required to pay (as it’s required to pay health insurance payments and income tax), then of course we will. I didn’t know about the 36 month cap, and since we’re semi long-term, I’d rather not pay for many years if we won’t get much of it back. Thanks!
Speaking from the experience of being someone who has both lived and worked in Japan for many years; then left Japan; then came back to work for many many many more years; then died and was reincarnated as an ant; worked my way up the ladder of existence and (through a multitude of wild rides on the endless cycle of birth and death) earnt enough good karma to make it back again as a human AND become the new leader of The LDP, I can tell you that the whole process needs a complete overhaul and that I and my colleagues will not rest until the job is done!!! Yessir! Fukuda-the-Builder, that’s what all the boys and girls call me. Can I fix it? Yes I can! To start with, I am going to throw out this whole messy money concept! Money can’t buy you love as Yoko Ono once screeched. How true! How true! I therefore propose that all those leaving Japan are paid a percentage of their pension back in onigiris. Delicious and healthy Japanese rice-balls. Now obviously, the type of rice-ball someone receives will depend on the number of years that the said person has worked. But…let me assure you all…the absolute MINIMUM-ROCK BOTTOM-BASIC RATE AU PACKET SERVICE will be TUNA AND MAYONAISSE. Now you can’t get fairer than that. Of course, those who choose to return to Japan will, upon having their fingerprints taken, have to repay the whole of their pension contribution that was not paid during their period of absence. Unfair??? Not at all. For, in this new ALL-LOVE-&-STICKY-KISS-KISS-LDP party of mine, we will allow the foreigner to repay their pension in a food substance of their own choosing! Yes!!! Oh, how the airports up and down our scared isles will exude the aroma of the world’s 2nd finest cuisine being hastily prepared by happy boys and girls wanting to return to the LAND OF LOVE. Happiness will be everywhere and I will make it a principle of mine that, once a week, I will address the nation on live TV and do some extreme eyebrow wriggling! JOY IS NOW HERE!!!
Julie,
Thanks for your post. From what it sounds like, your husband has quit/finished his job, and you are both now part-time? So you are both filing tax returns as sole traders? Once you file a tax return as a sole trader, they health and pension people start billing you from the next year based on your previous years income. If your husband was paying through the company, then maybe this is why his hasnt arrived- maybe it will next year.
As for whether you need to join the program and pay it, well “technically” you do. But please keep in mind that things such as income tax are taxes, whereas pension, health insurance, and NHK fees are not taxes. Therefore you cannot actually have assets seized, or be sent to jail for not paying them (as far as I know). This is an important difference. So “technically” you are “required” to pay, but technically there is nothing enforceable they can do if you dont. In the case of health insurance, they can take away your health card, but in the case of pension, I guess you just wont get paid after 65. Or was is 60?…(Id be interested to hear if anyone knows otherwise on this..)
Will ever get anything back if you pay them, well thats anyones guess I suppose. Given the increasing age of the population, the decreasing numbers of working age Japanese, and the potential decline of the Japanese economy due to the rise of other surrounding countries and its lack of innovation, I wouldnt count on the economy being robust enough. But Im a cynic too.
I got my pension refund a few months ago, but the tax refund seems to be taking just as long as the first stage… I’m beginning to suspect my tax representative has stolen my cash 🙂 Just kidding, but does anyone know how long the tax refund should take after submitting all of the appropriate documents?
For the life of me, I can’t see how aggregation and harmonization between Japan and US will ever help Americans who have worked a long time in Japan in terms of social security. It’s the last ten years of your employment before retirement in the US that is going to determine your social security. Any Americans out there figured this out?
Recently, the US and Japanese government passed something called the “Totalization Agreement.” This, as I understand it, allows either Japanese or U.S. citizens to count their work in the home country as years toward retirement in the new country. Supposedly, this would allow someone to work, say, in the USA for five years, then spend twenty years in Japan, and actually receive a Japanese pension. It is supposed to work for Japanese citizens in the USA as well. It is also evidently possible to receive both a US and a Japanese pension, though receiving a second pension may lower the payment on the first pension.
That much I found on the Internet, but I’d really like specifics, if anyone has them. How does one apply, where one apply, who is eligible, etc. Anybody out there know about this? Like many, I don’t much care for paying into a pension for many years, and only getting three years’ worth back. If I pay into a pension plan, it should be possible to receive a pension.
Thanks
Apologies if this question has already been addressed, but can someone please help me with the following?
I have paid into the Japanese pension system for 3 years now (2005-2007) but don’t plan to stay in Japan for 25 years (in order to receive a regular pension at age 65). Since there is no benefit for me continuing to pay into the pension system more than 3 years, then I’d like to know if I can stop paying into it? And if so, how? And can I do it on my own without my company knowing?
Related to that, here’s another question. If I somehow manage to stop the pension deductions (with or without my company’s help) and stay another few years here in Japan, then when I eventually go back (let’s say in 2010), then can I still get the 3 years lump sum amount back (i.e. the 2005-2007 portion)? Or do I forfeit that lump sum because I quit the pension system in 2008?
Thanks a ton to anyone who can help me out!
Once youve signed up and begin paying, its very difficult to get out as you have to convince someone to de-register you. One option is explaining that you have realised that you may not get a visa for the next 25 years, and thus dont have the right to be in Japan, and therefore no responsibility to pay into the system.
Or, the easiest way, is to move Kus. And dont register in the new ku.
About the totalization agreement between US and Japan. It sounds nice, but at least two obstacles stand in the way:
1. I need to get the retirement insurance office in Japan to accept my documentation of my work record in the US with the retirement office.
2. I need to document my work record in the US prior to coming to Japan.
I do have a social security record from the US. Will report back how this goes.
I would bet the people at the local office will jump when they see me, see my social security record in English, and then wonder what totalization agreement I’m talking about.
Still, being able to add 10 years of employment to my total years will help. But wait, what if it is part-time work?
Thanks Bone. But even if I move to a different KU won\’t I still need to get de-registered? My pension deductions are automotically taken off my paycheck each month. Thank you
I’m pondering the same situation myself… I was with AEON from 2006-2007, when they were still on part-time schedules (thus, no pension or insurance the first year), and then moved into a company which uses the shakai hoken. The national pension office already sent me a bill requiring me to pay for the few weeks I was technically unemployed (backpayments, of course), and I’m planning a move to Tokyo next month (June 2008).
When I move to Tokyo, I think I will most likely ignore the bill from the national pension scheme, skip the national pension and insurance window when I change my address, and continue enrolling in the shakai hoken for health care, ignoring pension entirely… think the national pension system’s paperwork will catch up to me when I apply for a lump-sum withdrawal next year? Can you even get a withdrawal for both the national and employee’s pension, if you’ve paid into both systems (if I’m cornered for some reason)?
Hi, I worked in Japan for five years but left five years ago. I didn’t know I could claim my payments back. Is there any hope for me applying now?
Nope – you must apply within two years of leaving Japan.
I left Japan in March 2007 and i send the claim form and all the documents in Jan 2008.But i haven\’t got any money back till now.So can anyone tell me how much time it takes to get the money back and also whome should i contact as i don\’t know Japanese.
I paid 5 months into the pension system, then took a Leave of Absence due to a family emergency, during which time my were not made.
Now I am in the process of resigning, and will stay at home, but I want to pay one more month into the system.
Would that make me eligible for a six-month lump sum refund?
I was able to claim my pension refund and this time am hoping to get a refund on the 20% tax imposed to it. The thing is, I failed to nominate a tax agent before leaving Japan. I understand this is a requirement to claim the tax refund. Given so, how do I claim the tax refund? Can I nominate a tax agent now?
How long did it take you to receive the refund?
If i remember it right, it took around 4 months to get the pension refund.
hi!
I applied for a pension refund last may, 2008. it’s now September and I am not still getting my refund.
Aside from checking on my bank account for the balance, does the pension agency in Japan inform us of the delivery of the refund?
also, I failed to nominate a tax agent when I was still there. Can I nominate one still even if I’m already in my hometown?
thanks!
I need some guidance, please. I will be 60 in October. I work at a private high school in Wakayama. Have been here for 20 years. I will not receive the big kahuna bucks the “J” teachers receive on retirement. How many pensions will I get? The private teachers mutual aid society said I would be getting about 40,000 a month! Like how do I buy food? Also I have 17 yrs. eployment in the USA. I was told I can get the 40,000 at age 60 if I want. Is there any other pension I am able to get? HELP. thank you.
hi, is this 6 months in total or 6 months at each company.
i have paid these for 24 months in total but for 6 months in my current company. I am planning to leave tokyo now. will i get this refund?
What I want to know is… what’s the exact procedure for checking up on your refund? Right now, I can’t even confirm my letter was received.
Hi Turner,
According to the lump-sum application form, the phone number of the Social Insurance Operation Center is 81-3-6700-1165. It notes to speak Japanese.
Why not give them a call to ask and leave a comment here with their reply?
Hi Florante,
According to the lump-sum application form you can file a “notification of tax agent” when you make a claim for a tax refund if you forgot to do it before you left Japan.
Hi,
I was told by the SIA that I needed to go to my local ward office to cancel my gaijin card AND tell them that I want to cancel my national pension.
Do I really need to do this in order to get this lump sum payment or can I just keep my gaijin card and still get my lump sum payment?
Thank you.
DS
I though that immigration takes your Gaijin Card off you when you physically leave the country. This sounds strange to me.
interesting… so, should I not bother going into the ward office? to be honest i owe some local inhabitant tax that I’m not willing to pay but I don’t want to forego my lump sum payment. What I’d like to do ultimately is to leave Japan and just send my form in and get the lump sum payment directly deposited into my bank account.
any thoughts?
hello there,
first, dave, i wish i could help you…but i just have a question as well.
i lived/worked/paid taxes in japan between 2004-(june)2007. i have received part(i think) of my lump sum, and am working on getting the rest of my money back.
intially, i sent my blue book with my bank stamp and a form filled out. that form was, as i recall(though it was almost a year ago), relatively simple. the second form that i have received from japan is sending me around the bend. i have been sent my blue book back along with the second form. the form requires that i calculate “1/4 contribution-exempt months(3/4)”, “half contribution-exempt months (1/2)” and “3/4 contribution-exempt months(1/4)” … i have no idea what they are looking for here, or how to figure this one out. i have read through the manual and asked around, and no one seems able to help me. i am in desperation.
any thoughts on the matter would be hugely appreciated!
…anyone?
thanks!
Thanks for that followup number, Dies, but it was deposited a few days after that. Four months’ time.
What I need to know now is, what additional paperwork or instructions do I need to send to my “authorized taxpayer” in Japan along with the withdrawal receipt to receive the full refund?
To register your tax representative you and that person have to fill in the form downloadable from the following URL, and mail it in two-fold to the tax office of the prefecture where you lived in Japan when you emigrated.
http://www.nta.go.jp/tetsuzuki/shinsei/annai/shinkoku/annai/07.htm
The tax representative needs to take your withdrawal receipt to any tax office (in person) to do the paperwork. From what I have understood so far that person does not need to bring anything else.
That said, I only just sent in my withdrawal application, so I am not speaking from experience, could be wrong..
Right, but what of the paperwork your representative has to present to the tax office? Should I try and get a copy of the forms he/she needs and send them along with the receipt, or can they only be filled out in person?
Hello,
I’m trying to fill out the form to get my pension refund, and I cannot figure out the difference between these 4 numbers. I’m guessing I don’t need the Seaman’s Insurance one, but are all the other numbers the same? Can I just fill out the “Basic Pension number” and assume they will be able to figure out the rest?
Basic Pension number
基礎年金番号
―
Employees’ Pension Insurance registration number
厚生年金保険の記号番号
―
Employees’ Pension Insurance （Seamen’s Insurance）registration number
厚生年金保険（船員保険）の記号番号
―
National Pension registration number
国民年金の記号番号
I was a salariman for a large Japanese company so I had an Employees’ Pension Insurance, not a National Pension. I asked our soumu’s department and they said that since some date in the past the numbers for the Employees’ Pension Insurance and the Basic Pension number are the same.
So I filled in the number on my pension book in the first two rows and left the other two blank.
I mailed my application earlier this month so ask me in half a year or so if I could get my money back successfully this way 😉
I worked in Japan for 3 years, always for the same company at the same office location. My question relates to filling out the “history” portion of the application for the lump-sum pension refund. Will I make an entry twice in the chart – once for the National Pension and again for the Emploees’ Pension? The information for each entry will only be slighty different. I feel as though I need to make 2 entries because of the Note at the bottom of the chart indicating that for the National Pension – “fill in only the address of the place you lived”. For the Employee Pension entry I would record the office address. I would record the sames dates for both.
Any information would be greatly appreciated. I also suggest adding samples of filled out forms to aid people.
I worked in Japan for 3 years, always for the same company at the same office location. My question relates to filling out the \”history\” portion of the application for the lump-sum pension refund. Will I make an entry twice in the chart – once for the National Pension and again for the Emploees\’ Pension? The information for each entry will only be slighty different. I feel as though I need to make 2 entries because of the Note at the bottom of the chart indicating that for the National Pension – \”fill in only the address of the place you lived\”. For the Employee Pension entry I would record the office address. I would record the sames dates for both.
Any information would be greatly appreciated. I also suggest adding samples of filled out forms to aid people.
Hello everyone,
I have a question about the pension refund and returning to Japan after filing for it. I applied for the pension refund after returning home but now I am planning to return to Japan to work again. I previously worked for two years in Japan. I will return to Japan in early April. That would make it 7 months since leaving. Will it have any affect on me getting my pension refund and/or tax return. I still haven’t received the lump-sum payment. Also, will I be able to claim a pension one/two/three years from this April?