How Social Insurance Premiums Are Calculated in Japan: Standard Monthly Remuneration and Grades

The four social insurance premiums taken from your pay

An employee in Japan pays the following four every month. Each rate below is the total rate; health insurance, long-term care insurance and employees' pension are split 50/50 with the employer, so the employee pays half.

The key point is that only employment insurance is charged on the pay actually received; the other three are charged on a separate figure, the standard monthly remuneration. That's why in a month with more overtime, only your employment insurance changes while your health insurance stays the same.

Standard monthly remuneration and grades

Standard monthly remuneration is your pay rounded to a bracket amount. Health insurance runs from grade 1 (¥58,000) to grade 50 (¥1.39 million), and employees' pension from grade 1 (¥88,000) to grade 32 (¥650,000). Everyone whose monthly pay falls within the same range is in the same grade and pays the same premium.

For example, anyone with monthly pay from ¥290,000 up to but not including ¥310,000 has a standard monthly remuneration of ¥300,000 (health insurance grade 22, pension grade 19). Whether you earn ¥295,000 or ¥305,000, the health insurance premium is ¥14,865 and the pension premium ¥27,450.

Employees' pension tops out at grade 32 (standard monthly remuneration ¥650,000): everyone with monthly pay of ¥635,000 or more pays the same premium, and the employee share is capped at ¥59,475 a month, or ¥713,700 a year. That cap is why the pension premium is the same whether you earn ¥8 million or ¥12 million a year.

When your grade is decided

Standard monthly remuneration isn't reviewed every month; it's revised only on set occasions.

• On enrollment: set from your expected pay when you join the company.
• Annual determination (teiji kettei): set from the average pay received in April, May and June, and used from September of that year to August of the next. This is the once-a-year review.
• Interim revision (zuiji kaitei): when a raise or pay cut changes your fixed wages and creates a difference of two or more grades for three months in a row, the grade is revised from the fourth month.
• Revision after maternity or childcare leave: if your pay drops after returning from leave, you can apply for a revision.

The saying that “overtime in April to June raises your premiums for a whole year” comes from the annual determination. But higher pension premiums also increase the pension you'll receive later, so it isn't purely a loss.

Allowances such as commuting and housing allowances are included in the average, and so is overtime pay. If you estimate your grade from base salary alone it won't match your payslip, so use your total gross pay.

Deductions by monthly pay

Monthly employee contributions calculated for Tokyo (Kyokai Kenpo, health insurance rate 9.91%), employees' pension 18.3% and employment insurance 0.55%.

Roughly 15% of monthly pay goes to social insurance, rising by about another 0.8% from age 40. Add income tax and resident tax and you get the total deductions on your payslip. On a monthly salary of ¥300,000, take-home pay is about ¥239,000.

What varies from person to person

Even on the same pay, three things change the premiums.

• Age: long-term care premiums start from the month containing the day before your 40th birthday. On an annual income of ¥5 million that's an extra ¥39,108 a year, or ¥3,259 a month. From 65 they are generally collected from your pension instead of your pay.
• Prefecture of your workplace: Kyokai Kenpo health insurance rates differ by prefecture; in fiscal 2025 they ranged from 9.44% in Okinawa, the lowest, to 10.78% in Saga, the highest. On ¥5 million a year that's a difference of ¥26,264.
• Whether you're in a health insurance society: societies use their own rates, and the employer may pay more than half. If your payslip doesn't match the Kyokai Kenpo calculation, check this first.

Checking your payslip with the tool

1. 1

   Open the “Monthly pay to take-home” tab

   Enter your monthly gross pay. You can also specify how many months' worth of bonus you receive per year.

2. 2

   Set your age and prefecture

   Under “Set conditions”, choose your age band and the prefecture of your workplace. If you're in a health insurance society, overwrite the rate directly.

3. 3

   Find your row in the grade table

   A table of all 50 health insurance grades is shown with your row highlighted, so you can check it matches the standard monthly remuneration on your payslip.

4. 4

   Compare the deductions with your payslip

   You'll see separate amounts for health insurance, long-term care insurance, employees' pension and employment insurance. If they differ, either the rate or the grade is different.

For annual take-home pay including social insurance, see How to Calculate Take-Home Pay; for the tax side, see Income Tax vs Resident Tax. Whether part-time workers have to enroll is covered in Japan's Income Walls.

FAQ

How is standard monthly remuneration decided?

As a rule it's set from the average pay received in April, May and June (the annual determination) and used from September of that year to August of the next. On joining, it's set from expected pay, and if a raise or cut changes fixed wages and creates a difference of two or more grades for three months in a row, it's revised in the fourth month (interim revision). It's based on total gross pay including overtime and commuting allowances, not just base salary.

How much is deducted for health insurance and employees' pension?

For Kyokai Kenpo in Tokyo, a standard monthly remuneration of ¥300,000 means ¥14,865 for health insurance and ¥27,450 for employees' pension; with employment insurance of ¥1,650, the total is ¥43,965 a month. Ages 40–64 add ¥2,385 for long-term care insurance. The rates are 9.91% for health insurance and 18.3% for pension, and the employee pays half of each.

Is it true that working overtime in April to June costs you money?

The annual determination sets your standard monthly remuneration from the average of those three months, so lots of overtime can raise your grade and your premiums for a year from September. But the extra pension premiums are reflected in your future pension, and sickness and maternity allowances are also calculated from standard monthly remuneration, so it isn't a complete loss.

Why doesn't my pension premium rise when my income goes up?

Because employees' pension has a ceiling at grade 32 (standard monthly remuneration ¥650,000). Everyone with monthly pay of ¥635,000 or more pays the same premium, capped at ¥59,475 a month or ¥713,700 a year for the employee. Health insurance goes up to grade 50 (¥1.39 million), so health premiums keep rising even above ¥10 million a year.

What share of pay goes to social insurance?

About 15% at 39 and under, and about 15.8% at 40–64. A monthly salary of ¥300,000 means ¥43,965 (¥46,350 from age 40), and ¥500,000 means ¥73,275 (¥77,250). Social insurance often weighs more than income and resident tax combined: on ¥5 million a year, social insurance is ¥721,460 against ¥364,000 in tax.