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Why 20.42% Is Withheld From Your Japanese Salary

Last updated: 13 October 2026 · rules as of 1 April 2026 (令和8年4月1日現在法令等)

If you are in Japan for less than a year — on a working holiday, say — you are generally a non-resident (非居住者) for income tax. Your employer then takes a flat 20.42% from every payment of salary: income tax and the reconstruction surcharge together. That withholding is the end of it. There is no year-end adjustment, no tax return and, unless a tax treaty covers your salary, no refund. If your stay is expected to last a year or more, you are a resident and the ordinary withholding tables apply. Resident tax is a separate question that turns on where you live on 1 January.

The YenTake calculator does not cover this case. It works out the pay of a resident — the monthly tables, the year-end adjustment, resident tax. For a non-resident its income tax figure is wrong, so use this page instead. Whether you are a resident is decided by the facts of your stay; the National Tax Agency and your tax office are the authority.

Resident or non-resident: how it is decided

Japan’s income tax law calls you a resident (居住者) if you have your address (住所) in Japan — the centre of your life here, judged on the facts — or if you have lived here continuously for a year or more. Everybody else is a non-resident.

Because the facts can be hard to read on the day you arrive, the law presumes an answer from your work. If you come to a job that normally needs you to live in Japan for a year or more, you are presumed to have your address here, and you are a resident from the start. If you do not, there is no such presumption. The National Tax Agency’s English answer puts it plainly: a visitor on a working-holiday visa who stays for less than a year is basically treated as a non-resident. It reaches the same answer for a technical intern (技能実習生) who is due to go home before a year is up.

What the 20.42% is

A non-resident’s salary for work done in Japan is taxed at a flat 20%, and the reconstruction surcharge (復興特別所得税) adds 2.1% of that tax, which brings the rate withheld to 20.42%. From 2027 the surcharge is split into a reconstruction part and a new defence part; the National Tax Agency’s table still gives 20.42% in total.

The rate is applied to the payment itself. Nothing is taken off first: no social insurance, no dependents, no basic exemption. On a salary of ¥250,000 a month, the tax withheld is ¥51,050 every month. A resident on the same pay — in Tokyo, aged 25, no dependents — has ¥38,144 of social insurance taken off first and then ¥4,770 withheld under the 2026 monthly table, and the year-end adjustment may move that again.

Why there is no refund

For a resident, the tax taken each month is only an estimate. In December the employer settles the year with a year-end adjustment (年末調整), or the employee files a final tax return (確定申告), and anything taken too much comes back.

A non-resident’s salary is taxed the other way: the tax withheld is the final tax, and nothing is settled afterwards. The National Tax Agency says that taxation of the non-resident “is completed by paying this withholding tax”, that a non-resident cannot file a final tax return, and so there is no refund of the tax taken from the salary. However many months you worked and however little you earned, the 20.42% stays where it is — the one exception being a tax treaty that covers the salary, below.

If your stay changes

Plans change: a contract is extended, a visa is renewed. The National Tax Agency’s published answer is that your status is judged again when the change happens, and it is never changed backwards. If you arrived expecting less than a year and it becomes clear that you will stay for a year or more, you are a resident from the day that became clear. The months before it stay non-resident months, at the flat rate. Tell your employer as soon as you know, so that it moves you onto the ordinary tables.

The other way round matters too. If you came to a job expected to last a year or more, you were a resident from the start, and the flat rate should not have been used. Ask your employer which basis it has been using; the year-end adjustment, or a tax return, is how a resident’s year is put right.

Tax treaties

Japan has tax treaties with many countries, and a treaty can reduce or remove Japanese tax on some income. To use one, the form for it (租税条約に関する届出書) goes to the tax office through the payer before the payment is made. Whether your treaty covers a working-holiday salary is not something to assume: the National Tax Agency’s English answer, given to a visitor from Australia, says a salary from a Japanese company or a resident is not exempt under the tax treaty. Check your own country’s treaty with the National Tax Agency before you rely on it.

If a treaty does cover your salary and the form was not filed in time, the tax is still withheld at the full rate, but the National Tax Agency says the difference can be claimed back later: the same form goes in with a treaty refund claim (租税条約に関する源泉徴収税額の還付請求書, Form 11), again through the payer.

Resident tax depends on 1 January

Resident tax (住民税) is a local tax, and it does not follow the income tax rules above. The Ministry of Internal Affairs and Communications puts it this way: if you have an address in Japan on 1 January and received a certain amount of salary, you pay resident tax to that city, on the previous year’s pay — and that is the same if you leave Japan on 2 January.

So a working holiday that runs from spring to autumn of one year never meets a 1 January, and no resident tax arises from it. One that runs through the new year can bring a bill from June for the months worked the year before. If you will have gone by then, the city expects you either to pay it before you leave or to name a tax agent (納税管理人) to pay it for you. The resident tax guide for leaving Japan goes through what is owed in each month.

The pension refund some people claim after leaving (脱退一時金) also has 20.42% withheld from it, but under different rules: that tax can come back through a return. The pension refund guide covers it.

Questions people ask

Can I get the 20.42% back at the end of my working holiday?

Not if you were a non-resident. The National Tax Agency says the tax withheld settles a non-resident’s tax on the salary, and a non-resident cannot file a final tax return, so there is no refund of it. The exception is a tax treaty that covers your salary: then the difference can be claimed back through your employer with the treaty refund claim (Form 11).

My job is for more than a year. Why is 20.42% being taken?

Ask your employer which basis it is using. If you came to a job expected to last a year or more, you are generally presumed to live in Japan from the start, and the ordinary withholding tables apply instead. If your plans changed later, you count as a resident only from the day the change became clear; the months before it stay at the flat rate.

Does the YenTake calculator work for a non-resident?

No. It works out the tax of a resident, using the monthly withholding tables, the year-end adjustment and resident tax. For a non-resident the income tax is simply the flat rate on each payment, and the calculator’s figures do not apply.

Do I pay resident tax on a working holiday?

It depends on 1 January. Resident tax is owed to the city where you have an address on 1 January, on the previous year’s salary, even if you leave the next day. If you are not living in Japan on 1 January, there is no bill for that year.

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