Year-End Tax Refund in Japan: When and How Much

Last updated: 19 October 2026 · the National Tax Agency’s 2026 year-end adjustment guide · figures for the 2026 tax year

The refund from Japan’s year-end adjustment (年末調整, nenmatsu chōsei) comes inside the last pay of the year, which for most people is December’s. Part of it can wait for January or later when your employer’s own tax payments are too small to cover it. On a salary of ¥5,000,000 paid monthly in Tokyo, with nothing else claimed, the 2026 refund is ¥55,040. For your own figure, use the take-home calculator; for why December settles the year at all, see why December pay is different.

This is a general explanation for somebody paid a salary by one employer in Japan. Your employer’s payroll and the tax office are the authority on your own year.

Which payslip it is in

The National Tax Agency’s guide for employers does the year-end adjustment on the last salary or bonus paid in the year, whichever comes last. It allows payroll two ways to do it — work out that payment’s tax as in any other month and then settle, or skip that month’s tax and settle on the year — but either way you see one figure: more pay than usual if tax comes back, less if it is taken.

Why part of it can come in January or later

Your employer does not get the money from the tax office first. It pays your refund out of the income tax it has withheld from everybody’s pay that month and would otherwise hand to the tax office. If that is not enough, the guide says it refunds the rest from the tax it withholds in the following months, in turn. A small employer, or a year like 2026 when refunds are larger than usual, can run out that way.

• The tax office steps in when the employer cannot do it: it has stopped paying salaries or closed, it has no tax to set the refund against, or the refund is not expected to be finished within the two months that start the month after it falls due — for a refund due in December, by the end of February. The employer then claims from the tax office, which pays the employer in one sum or pays you directly.
• A redo can also land in January. A form or an insurance certificate that came late can be added until 31 January, and the extra shows on a January or February payslip — how a redo works.

If December’s payslip shows less coming back than the year-end statement says, ask payroll whether the rest is scheduled for the next months.

How much: six salaries in 2026

These are the take-home calculator’s figures for an employee in Tokyo, under 40, single, paid in twelve equal months with no bonus, who handed in the dependents declaration and the basic exemption form (基礎控除申告書) and nothing else. Without the basic exemption form the year-end adjustment leaves out the basic exemption, and the refund is much smaller or becomes a bill.

Refunds this size for somebody who claimed nothing extra are not normal. They come from the 2026 rise in the basic exemption: the monthly table used the old figures until November 2026, and December applies the new ones to the whole year. The rise is not the same at every income, which is why the refund does not simply grow with the salary.

Estimating your own

1. Start from the calculator. Put in your salary, bonuses, age, prefecture and the dependents you declared. Its December line is the refund for that much of your year.
2. Add each deduction you hand in at the year-end. Life and earthquake insurance, iDeCo you pay yourself, a spouse who was not on the monthly declaration. While your taxable income stays in the same band, each is worth the deduction times that band’s rate, plus 2.1% of that for the reconstruction surtax. A ¥40,000 deduction at a rate of 5% is worth ¥2,042 before the year’s tax is rounded down to the hundred yen. When the deductions take your taxable income down into a lower band — a spouse can — the part below the band’s edge is worth only the lower rate, so work the year’s tax out again and take the difference. The bands are in the income tax brackets.
3. From the second year, take off a home-loan credit. It is a credit against the tax, not a deduction from income. It comes off the income tax before the 2.1% surtax is added, so it is worth its amount plus 2.1%, up to the year’s tax. The first year’s credit is claimed on a final tax return (確定申告), not through payroll, so it is not part of December’s figure.
4. Check the bonuses. A large bonus after an ordinary month is taxed at too low a rate, and the year-end takes some of it back.

Why you might owe instead

The guide lists when withholding turns out too high: a dependent or spouse added during the year, becoming a person with a disability, a widow, a single parent or a working student during the year, small bonuses, a year you did not work in full, a home-loan credit, and a spouse or relative deduction the monthly table never counted. A bill comes from the opposite:

• Large bonuses. The rate for a bonus is read off the previous month’s salary, not off the year, so a large one is under-withheld — how a bonus is taxed.
• A dependent who stopped counting. A spouse or relative on your monthly declaration whose own income for the year went over the limit, or who left your household.

If December takes a lot: putting part of it off

A shortfall comes out of the pay that carries the adjustment, and anything left out of later pay. If taking it all at once would leave that month’s pay after tax below 70% of your average monthly pay after tax from January to the month before, you can ask to spread it. You fill in the application to defer the shortfall (年末調整による不足額徴収繰延承認申請書) and payroll sends it to its tax office by the day before that last payment. Once approved, the shortfall is taken in January and February of the next year instead. Only the shortfall moves: that month’s ordinary tax is still taken as usual.

Questions people ask

Why did part of my refund come on the January payslip?

Usually because your employer pays refunds out of the income tax it withholds from everybody’s pay, and that month’s was not enough, so the rest follows in the next months. The other common reason is a redo of the adjustment in January, after a late form or certificate.

Can the refund be paid straight into my bank account?

Normally it is part of a payslip. The tax office pays it only when your employer cannot: it has stopped paying salaries, has no tax left to set the refund against, or does not expect to finish within the two months that start the month after the refund falls due, which for December means by the end of February. Then the tax office pays the employer in one sum or pays you directly.

Does the refund change my resident tax?

No. The refund is income tax you paid too much of, not income. Resident tax is worked out separately by your city on the same year’s figures, and that bill starts in June of the next year.

This is a general explanation and an estimate, not advice about your situation. What your employer’s payroll does, and how your own year is treated, is a question for them and for a 税理士 (licensed tax accountant).

Sources

• National Tax Agency — 令和8年分 年末調整のしかた 4 過不足額の精算 (pages 39 to 41: the adjustment on the last salary or bonus of the year; refunds out of the employer’s withholding, then the following months’; the tax office when the employer cannot, including when it does not expect to finish within the two months from the month after the refund falls due; the list of reasons for a refund; a shortfall taken from that pay and later pay, deferred to January and February under the 70% test). Japanese, PDF, opened 19 October 2026.
• National Tax Agency — A2-10 年末調整による不足額徴収繰延の承認申請 (who can apply, and by the day before the last payment of the year; through the employer). Japanese, opened 19 October 2026.
• National Tax Agency — 令和8年度税制改正による所得税の基礎控除の引上げ等について (withholding through November 2026 unchanged; the year-end adjustment applies the new amounts). Japanese.
• National Tax Agency — No.1230 住宅借入金等特別控除の手続 (the first year of the home-loan credit needs a final tax return; from the second year an employee can take it at the year-end adjustment). Japanese, opened 19 October 2026.
• National Tax Agency — 令和8年分 源泉徴収税額表 (the monthly table the year’s withholding in the table is read from). Japanese.

See your own December line