Understanding Japan's Pension System

When a foreigner works in Japan, "pension" is an unavoidable issue.

But what is the Japanese pension system like? Do foreigners need to join?" Many people have various questions such as "What is the Japanese pension system?

This article explains the Japanese pension system and whether foreigners are required to join it.

About the Japanese Pension System

Japan's pension system is a type of social insurance

Social insurance is a system that allows people to receive necessary money and services when their lives become unstable due to illness or unemployment.

Within this social insurance system, the "public pension system" was created as a mechanism for everyone to support each other in old age and in the event of the death of a family member.
 
All residents of Japan between the ages of 20 and 60 are obliged to join and pay the National Pension Plan.

（Source：日本年金機構　年金の制度や仕組みに関するパンフレット「知っておきたい年金のはなし」P2、厚生労働省　公的年金制度の概要「教えて！公的年金制度　公的年金制度はどのような仕組みなの？」）

National Pension Plan and Employees' Pension Plan

There are two types of pension plans in Japan.
 

• National Pension: It is also known as the basic pension.All persons between the ages of 20 and 60 are eligible to join.
• Employee Pension:Company employees and civil servants are enrolled in this program.*Working hours of less than 20 hours per week and monthly wages of less than 88,000 yen are not eligible for this program.

*Image

The National Pension Plan, in which all people between the ages of 20 and 60 are enrolled, is the foundation of the National Pension Plan, and the Employees' Pension Plan is like an addition amount for company employees and public employees.
This means that company and government employees will be enrolled in two pension plans.

About Benefits

By being a member of the pension plan, you are entitled to receive the following three benefits

• 老齢年金（ろうれいねんきん） /Pensions for the Elderly: When you reach 65 years of age or older, you will receive a certain amount of money per month according to the amount of pension you have paid so far.
  
• 障害年金（しょうがいねんきん） /Pension for disabilities and illnesses.:When an illness or injury makes it difficult to live or work, a "basic disability pension" can be received.
• 遺族年金（いぞくねんきん） /Pension for bereaved family members:This is a pension received when a family member dies.The conditions may vary depending on the family structure and who dies.

Thus, the pension system is not only for the elderly, but also for young people who may also use the system.

Do foreigners need to join?

Foreigners must also join the National Pension Plan

The public pension system is a system in which all residents of Japan between the ages of 20 and 60 are required to participate. Therefore, foreigners living in Japan are also required to join the system.
*Except for those staying for a short period of time

（Source：日本年金機構　Japanese National Pension System（国民年金制度の仕組み） 「国民年金制度の仕組み（日本語/Japanese）」 ）

Enrollment Procedures and Premium Payment Methods

1. Those who only enroll in the National Pension Plan (Category 1 insured persons)

After completing the resident registration procedures within 14 days of arriving in Japan, you should go through the enrollment procedures at your city/ward office or nearby pension office.
After the procedure, the Japan Pension Service will send you a payment slip.
Take that payment slip to a convenience store or bank and pay the premiums.
 *Temporary overseas travelers may be insured under Category 3 as a special case.

2. People who work for a company (Category 2 insured person)

The company will handle the enrollment procedures, so there is no need to do it yourself.
Premiums are paid by deductions from the salary.

3. A person who is a dependent of a family member (Category 3 insured person)

Procedures for housewives, househusbands, and other family dependents are handled through the company where the No. 2 insured person works.
Ask your company representative for more information.
Premiums are paid by the second insured person and do not have to be paid.

（Source：日本年金機構　Japanese National Pension System（国民年金制度の仕組み） 「国民年金制度の仕組み（日本語/Japanese）」 ）

How to prevent dual enrollment with your home country

The Social Security Agreement is an agreement between Japan and the home country to prevent dual enrollment in the pension system.
Some countries also have agreements in place that allow the total period of membership in the pension systems of both countries to be aggregated.
Check to see if your country has this agreement.

日本年金機構：「外国人のみなさま　社会保障協定　それぞれの国（くに）との協定（きょうてい）の状況（じょうきょう）」
"To Foreigners, Social Security Agreements: Status of Agreements with Each Country (Status of Agreements)" 

If you don't pay it

If you do not join the pension plan or do not pay the premiums properly, it is more likely that you will not be able to renew your status of residence or that you will not be granted permission when you want to take up permanent residence.

In addition, you will not be able to receive "障害年金" or "遺族年金".So, we recommend to join the program properly and pay the premiums.
（Source：出入国在留管理庁　永住許可に関するガイドライン（令和5年12月1日改訂））

If you can't pay it

You may find it difficult to pay the premiums because you have stopped working and your income has decreased. In such cases, you may apply for partial or total exemption from the premium.
It can be paid later within 10 years. To apply, go to your city/ward office or nearby pension office.
（Source：日本年金機構「Application for National Pension Contribution Exemption／Payment Postponement」）

When you return to your home country

To receive an old-age pension, you must pay premiums for 10 years.
However, you may return to your home country before 10 years have passed.
 
For such foreigners, they can apply for a "Lump-sum Withdrawal Payment," which will refund a portion of the premiums already paid.
The "Lump-sum Withdrawal Payment" is contingent upon having paid premiums for at least six months.
In addition, the claim must be filed within two years of the loss of the Japanese address.
（Source：日本年金機構　脱退一時金を請求する方の手続き）

Documents required when filing a claim

• Lump-sum Withdrawal Payment Claim Form
• It can be downloaded from the Japan Pension Service website or obtained at the nearest city/ward office or pension office.
• Japan Pension Service: "Lump-sum Withdrawal Payment Claim Form for Foreign Nationals with Short-Term Residency"
• Copy of passport
• A copy of proof that the applicant does not have an address in Japan(a copy of the resident card or a copy of the page of the passport that confirms the date of departure from Japan, etc.)
• Proof of account information to receive the lump sum
• Basic pension number notification or pension notebook
• Authorization Letter * to process the claim on behalf of the applicant

（Source：日本年金機構　脱退一時金を請求する方の手続き）

How to submit

Submit your application by international mail or electronically to the Japan Pension Service Headquarters.

*For details; 日本年金機構「脱退一時金を請求する方の手続き」

Final thoughts

Even foreigners must participate in the Japanese pension system.
However, if you are unable to make payments due to difficulties in living, you can apply for an exemption. You can also apply for a lump-sum withdrawal payment when you return to your home country.
 
If you are enrolled, you will have cover in case of illness, injury, or other incidents.
Be prepared for future risks by paying proper premiums.

Frequently Asked Questions

1. Where can a foreigner consult about the Japanese pension system?

You can consult at a pension office near your home or at the Japan Pension Service. You can find a pension office near you on the Japan Pension Service website.
Web site:「あなたの近く（ちかく）の年金事務所（ねんきんじむしょ）」
 
In addition, the Japan Pension Service provides telephone consultation services in multiple languages. You can inquire about pensions in general and enrollment in particular.
Web site:「外国人のみなさま　いつもの言葉ことばで相談そうだんできます（通訳つうやくサービス）」
(Languages supported) English, Chinese, Korean, Vietnamese, Tagalog, Nepalese, Indonesian, Thai, Portuguese, Spanish

How much pension will I receive?

The amount of pension payments is determined by the length of enrollment and payment of premiums.If you want to know the detailed amount, check with the pension office.

Where can I get information about the pension plan?

More information about the pension system can be obtained from the Japan Pension Service website. 日本年金機構 (Japan Pension Service.)
 
Information is also available on the Immigration and Immigration Control Agency's website, so please look there. 「外国人生活支援ポータルサイト」  "Portal Site for Assistance to Foreign Residents"