Employees' pension insurance premium rate fixed at 18.3%; standard monthly remuneration has 32 grades from JPY 88,000 to JPY 650,000The pension premium rate for company employees stays at 18.3%
The employees' pension insurance premium rate finished rising in September 2017 and has been fixed at 18.3% since. Monthly premiums are calculated by applying the rate to the standard monthly remuneration, and bonus premiums by applying it to the standard bonus amount. The employer and the insured person each pay half.
- Standard monthly remuneration
- JPY 300,000
- x Employees' pension premium rate
- 18.3%
- = Premium (total)
- JPY 54,900
- Insured person's share (half)
- JPY 27,450
Key points
- Monthly premium = standard monthly remuneration x 18.3%; bonus premium = standard bonus amount x 18.3%. The employer and the insured person each bear half.
- Standard monthly remuneration has 32 grades, from grade 1 (JPY 88,000) to grade 32 (JPY 650,000).
- The standard bonus amount is the pre-tax bonus with amounts under JPY 1,000 dropped, capped at JPY 1,500,000 per payment. If bonuses are paid two or more times in the same month, they are added together.
What to do in practice
- Check that your payroll software uses an employees' pension insurance rate of 18.3% and an upper limit of JPY 650,000 for the standard monthly remuneration.
- When paying bonuses, check that the calculation uses the standard bonus amount (under JPY 1,000 dropped, JPY 1,500,000 cap per payment, multiple payments in a month combined).
In the employees' pension that people working at companies join, the premium is set by multiplying a fixed rate by your pay grade. That rate is 18.3% and is now fixed so it will not rise. The company pays half.
Points
- The rate is fixed at 18.3%.
- You and your company each pay half (9.15% each).
- The same rate applies to bonuses too.
What the words mean
- Employees' pension
- The national pension system for people who work at companies and similar workplaces.
- Splitting in half
- Each side paying half of the cost.
- Japan Pension Service: Japan Pension Service: Employees' Pension Insurance Premiums
This article summarizes and explains materials published by government agencies and is not advice on any individual case. Rules can change, so for actual procedures and decisions always check the latest original materials and consult professionals such as tax accountants or labor and social security attorneys. English, Simplified Chinese and Traditional Chinese versions are translations prepared from the Japanese articles for convenience. If anything differs, the Japanese text and the original source take precedence.