What is the Employees' Pension lump-sum withdrawal payment?

If you worked in Japan for a period and were enrolled in the Employees' Pension (厚生年金, kosei nenkin), there is a scheme that settles part of the contributions you paid when you leave the country. That payment is the lump-sum withdrawal payment (脱退一時金, dattai ichijikin).

In Japan, anyone employed by a company must enrol in the Employees' Pension, regardless of nationality. But most foreign nationals do not retire in Japan, so a short enrolment followed by departure would mean losing the contributions entirely. The lump-sum withdrawal payment exists to offset that imbalance.

It is not the same scheme as the National Pension

Japan has a National Pension (国民年金) and an Employees' Pension (厚生年金), and they are treated differently.

• National Pension — for the self-employed, freelancers and others. No income tax is withheld from its lump-sum withdrawal payment.
• Employees' Pension — for people employed by a company. When the lump-sum withdrawal payment is made, 20.42% is automatically withheld as income tax.

These guides — and the income tax refund itself — are about the Employees' Pension. If you only received a National Pension lump-sum, no tax was withheld in the first place, so there is nothing to reclaim.

Who can receive it

Eligibility for the lump-sum payment itself (enrolment period and similar conditions) belongs to the pension system and is not covered here. This series focuses on reclaiming the income tax withheld from a lump-sum payment you have already received, or are about to receive.

The lump-sum payment is, as a rule, claimed by you personally, and the claim deadline is two years from the date you left Japan. If you have not claimed it yet, that deadline comes first, so it is worth moving quickly.

What happens once you receive it

When your claim goes through, a payment decision notice (支給決定通知書) is issued. It states the amount paid and the tax withheld at source (20.42%). That withheld amount is exactly what the next step — the income tax refund — is about.

This article covers the outline of the scheme only. Your enrolment period, the amount you received and whether a refund is possible can only be judged accurately from your payment decision notice; individual cases need a tax accountant's review.