Overview

Year-end adjustment (年末調整) is a process where employers reconcile employees' annual income tax through the final salary payment in December. Declaration forms for various deductions — dependent exemption (扶養控除), basic exemption (基礎控除), insurance premium deduction (保険料控除), housing loan deduction (住宅ローン控除), etc. — are collected from employees, and the correct annual tax is calculated. Forms are distributed from around November 1, and the process must be completed by December 31.

Key things to know

• Forms distribution begins around November 1 • Adjustments are made with December's final salary; must be completed by December 31 • Employers collect declaration forms for dependent exemptions, insurance premiums, etc. • Withholding certificates are issued to employees after completion • Employees with salary income exceeding ¥20 million are excluded from year-end adjustment

Related dates