The minimum employment income deduction rises from JPY 650,000 to JPY 740,000The "necessary-expense allowance" you can subtract from part-time income got bigger
The minimum amount of the employment income deduction was raised from JPY 650,000 to JPY 740,000. For 2026 and 2027 (Reiwa 8 and 9), where salary income is JPY 691,000 or more but less than JPY 2.2 million, employment income is calculated by a separate formula, and the NTA's year-end adjustment "Table of salary amounts after employment income deduction" incorporates this.
- Salary income
- JPY 1.5 million
- Minus (using the formula salary income minus JPY 740,000) JPY 740,000
- JPY 740,000
- Employment income
- JPY 760,000
Key points
- For salary income of JPY 1.9 million or less, the employment income deduction is JPY 740,000 (previously JPY 650,000). There is no change to the deduction for salary income above JPY 2.2 million
- For 2026 and 2027 (Reiwa 8 and 9), if salary income is JPY 741,000 or more but less than JPY 2,191,000, employment income is "salary income minus JPY 740,000". If it is JPY 691,000 or more but less than JPY 741,000, it is "none"
- JPY 2,191,000 or more but less than JPY 2,193,000 gives JPY 1,451,000; JPY 2,193,000 or more but less than JPY 2,196,000 gives JPY 1,453,000; JPY 2,196,000 or more but less than JPY 2.2 million gives JPY 1,456,000
- The table of salary amounts after employment income deduction (for 2026 (Reiwa 8)), used for year-end adjustment etc., was revised. The minimum guaranteed necessary expenses for home workers etc. also rises to JPY 690,000 (previously JPY 650,000)
What to do in practice
- For the December 2026 (Reiwa 8) year-end adjustment, use the NTA's 2026 (Reiwa 8) "Table of salary amounts after employment income deduction"
- If specific expense deduction or income adjustment deduction applies, the amounts differ from the table, so check individually
For wages from a company, there is a rule called the "employment income deduction" that lets you subtract a set amount as the cost of working. Even if your income is low, the minimum amount you can subtract rose from JPY 650,000 to JPY 740,000. So the part that gets taxed becomes smaller.
Points
- Even people with low pay can subtract at least JPY 740,000 (it used to be JPY 650,000)
- The minimum expenses for people who do work at home, for example, also went from JPY 650,000 to JPY 690,000
- The rule for people with very high income (more than JPY 2.2 million) does not change
What the words mean
- Employment income deduction (給与所得控除)
- An amount you are allowed to subtract from income as the cost of earning wages
- Minimum guaranteed amount (最低保障額)
- The least amount you may subtract even when income is low
- National Tax Agency (NTA): NTA: How to do year-end adjustment for 2026 (Reiwa 8) (I. Changes from last year)
- National Tax Agency (NTA): NTA: April 2026 (Reiwa 8) Outline of revisions to withholding income tax
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.