Japan: three sets of rules running at once
Calendar 2026 has three parameter vintages live simultaneously, and mixing them is the standard way to get Japanese tax wrong. Income tax follows the Reiwa 8 reform, which lifted the employment income deduction to a minimum of ¥740,000 and the basic deduction to ¥1,040,000. Add those together and you get ¥1,780,000, the salary at which income tax first becomes due. Inhabitant tax kept its own basic deduction of ¥430,000, unchanged, so the national and local taxable incomes now diverge by as much as ¥610,000 while the adjustment credit that exists to compensate still only recognises ¥50,000 of the gap.
Income tax itself is the simple part: a quick-calculation table of rate minus a constant, applied to taxable income rounded down to ¥1,000, then multiplied by 1.021 for the reconstruction surtax. From 2027 that surtax drops to 1.1% and a 1% defence surtax replaces the difference, so the combined charge does not move.
Inhabitant tax is 10%, six points municipal and four prefectural, plus a flat ¥5,000 that includes the ¥1,000 forest environment tax. It is charged on the previous year's income and collected from June to May, which is why a first-year employee pays none at all. Social insurance is split evenly with the employer and includes a 0.23% child-rearing support levy that is new from April 2026, collected as a surcharge on the health insurance premium and split the same way, so anything still running on FY2025 rates is short by that line.
Employment income and basic deductions of ¥2,380,000 leave ¥1,458,000 taxable after social insurance.
Income tax ¥72,900 plus the 2.1% reconstruction surtax ¥1,530. Inhabitant tax ¥209,200. Social insurance ¥661,044: health ¥226,800, pension ¥411,744 and employment insurance ¥22,500.
Take-home: ¥3,555,326 a year, ¥296,277 a month. Your employer pays ¥676,800 on top, taking the true cost of the job to ¥5,176,800.