Getting Back the 20.42% Tax on Your Japanese Pension Lump-Sum Withdrawal Payment (脱退一時金)

Last reviewed: 2026-09. The rate, the form, and the filing window below were checked in September 2026 against the National Tax Agency pages, the current Income Tax Act, and the Japan Pension Service claim form linked in the source list.

The pension claim and the tax return are different procedures. The claim goes to the Japan Pension Service. The tax return goes to a tax office. This page keeps them apart.

What this page will not do

TakoyakiCPA does not act as a tax agent (納税管理人, nōzei kanrinin), does not file the return, and does not calculate whether any amount would be refunded on a particular payment. No.12005 says you may claim a refund if you choose the return it describes. “May” is the National Tax Agency’s word. A refund is a result of that calculation. It is not a result this page can state.

The official tax step is the return on the National Tax Agency form list, filed with the tax office, with the notice the Japan Pension Service sends. Businesses that offer to file that return for a fee are outside those instructions. This page does not recommend them and does not link to them.

Two payments, and only one of them is withheld at 20.42%

A lump-sum withdrawal payment (脱退一時金, dattai ichijikin) is a Japan Pension Service benefit for a person who is not Japanese, leaves Japan, and has a short period of coverage. The English index says you apply after you are no longer covered, and within two years since you leave Japan. The claim form has the conditions. They are summarized under “The pension claim” below.

The tax is narrower than the pension benefit.

No.12005 says that when you receive a lump-sum withdrawal payment of employees’ pension insurance (厚生年金保険), income tax at 20.42% is withheld from the amount to be paid. The page says that rate includes the special income tax for reconstruction (復興特別所得税).

The Japan Pension Service claim form says the same 20.42% figure for an Employees’ Pension Insurance lump-sum withdrawal payment paid to a non-resident. The same note says income tax is not withheld on a lump-sum withdrawal payment from the National Pension (国民年金).

If the payment you received is the National Pension lump-sum, the 20.42% withholding this headline refers to is the Employees’ Pension case. The claim form is the place that distinction is printed.

Withholding can be the end of the tax

No.12006, section 3(4), describes retirement allowances and similar payments paid to a non-resident in Japan. A rate of 20.42% applies to the amount paid as Japan-source income, and taxation is completed by that separate withholding. The National Tax Agency’s filled-in example says the same thing in Japanese: 20.42% income tax and special reconstruction income tax is withheld, and in principle the withholding finishes the tax.

That is the default. The return below is a choice to use a different calculation. It is optional.

The choice: be taxed as if you had received the payment as a resident

No.12005 says you may claim a refund of the amount withheld if you opt to file a return under Article 171 of the Income Tax Act. No.12006 explains what that option does. You can choose to calculate income tax and the special reconstruction tax on the retirement allowance by deeming that you received it as a resident, and to file a return. The tax is then calculated by applying progressive rates to the retirement income. The total retirement allowances to be paid in the year are treated as received as a resident, and that total goes into the calculation.

Article 171 is the statute. It lets a non-resident who receives a retirement allowance that falls under Article 161, paragraph 1, item 12(c) — the Japan-source retirement-allowance category — elect to be taxed on the total of such allowances paid in the year by reason of that retirement, as if a resident had received them, using the retirement-income rules in Article 30 and the tax rates in Article 89.

The Japan Pension Service claim form gives the return an English name: “Tax Return for Refund Due to Taxation on Retirement Income at the Taxpayer’s Option.” The Japanese name on that form is 退職所得の選択課税による還付のための申告書. The National Tax Agency’s filled-in example calls the same filing 退職所得の選択課税の申告書. The form list says this election return uses the ordinary final return’s page 1, page 2, and page 3 (the separate-taxation page). There is no separate blank form with only the long Japanese title.

Piece	What the official page says
Statute	Income Tax Act Articles 171 and 173
What you file	Final-return pages 1 and 2, plus page 3 (separate taxation), for the year of the payment. The form list says the election return uses those three pages
Worked example for this pension payment	Filled-in example, including the Employees’ Pension lump-sum case
Blank pages, Reiwa 7 (2025) year and after	Pages 1 and 2 and page 3
Paper that shows the tax was withheld	The notice sent with the payment, described in the next section

This page does not tell you which box to check. The filled-in example is the National Tax Agency’s illustration. Copying its numbers onto a real return would be wrong; the example uses a sample payment.

Article 297 of the Order for Enforcement of the Income Tax Act says that when you file the Article 173 return and part of the withheld tax has in fact been withheld, you attach a statement of the matters set by Ministry of Finance ordinance that explain the withholding. The filled-in example is the National Tax Agency’s guide to how the return is put together. The ordinance’s own form name is not printed on No.12005.

The notice you send with the return

No.12005 says you file with a “Notice of the Lump-sum Withdrawal Payment (Entitlement).” The Japan Pension Service claim form says that when the payment is remitted, it sends a “Notice of Lump-sum Withdrawal Payment Determination” (脱退一時金支給決定通知書), and that you send the original to your tax agent. Those are the two English labels for that notice. Use the document the Japan Pension Service actually sends, and send the original the way the claim form says.

Where it is filed, and through whom

No.12005 says you file with the district director of the tax office that has jurisdiction over your place for tax payment, through your tax agent in Japan. It points to No.12004 for the tax agent.

The claim form is more specific about the office for this refund: the tax office with jurisdiction over your final address or place of residence in Japan. It says you file a “Notification of Tax Agent for Income Tax/Consumption Tax” with that office before you return to your country, if you want to file the return and receive a refund. It says the tax agent needs no qualification other than an address or a place of residence in Japan. If you left without filing that notification, the claim form says you submit it together with the return.

The National Tax Agency’s own procedure page titles that notification 所得税・消費税の納税管理人の選任・解任届出書. How to file it, and what the agent does, is in the leaving-Japan article. The form instructions say the agent’s work includes receiving refunds. They exclude administrative appeals.

No.12004 adds that the return’s tax office follows your place for tax payment, and follows the address of the agent only in the sense that the agent files for you. The place-for-tax-payment order is in the leaving-Japan article.

When you can file

Article 173 says a non-resident who was subject to withholding on the retirement allowance, and who elects Article 171, may file the refund return on or after January 1 of the following year. If the total of the retirement allowances covered by Article 171 is fixed before that January 1, the return may be filed on or after the day the total is fixed.

The National Tax Agency’s filled-in example uses the same dates. Its sample is a payment decided in 2025, so the example return is a Reiwa 7 (2025) return. The year on the return follows the year the payment was decided, in that example. Use the year that matches your notice.

Article 173 does not set a last day. Article 297 of the enforcement order, which covers the statement and the refund processing, does not add a last day either. The district director refunds the amount in Article 173, paragraph 1, item 3: the withheld tax minus the tax computed under the election. If some of the withheld tax has not yet been paid in, Article 173, paragraph 3, says that unpaid portion is not refunded until it is paid. Article 297 says the district director carries out the refund or the offset promptly, unless there is reason to think the amount written on the return is too high.

A general five-year window for other refund returns is printed on National Tax Agency code No.2030. That page is about a different return. It is not cited here as the deadline for Article 173, because Article 173 does not use it.

The current text of Article 173 on e-Gov, re-read on September 28, 2026, still sets a first day and no last day. This page will be re-checked if that text is amended.

What the refund amount depends on

No.12006 says the elected tax uses progressive rates on the retirement income, with the year’s retirement allowances treated as received by a resident. Whether that tax is lower than the 20.42% already withheld is a calculation under Article 30 and Article 89. Article 173 refunds the difference when the withheld tax is the larger figure. This page does not run that calculation and does not say that a given payment produces a refund.

The filled-in example shows sample arithmetic for one fictional payment. Those figures are the example’s figures.

The pension claim, which is not the tax return

The tax return cannot be filed until the Japan Pension Service has paid the lump-sum and issued the notice. The claim itself has its own conditions. The claim form says you can claim for coverage under the National Pension, Employees’ Pension Insurance, and mutual-aid pensions from your stay in Japan after you have lost insured status and left Japan, if all four of these are true:

You do not have Japanese nationality.
Your National Pension contribution-paid period, counted the way the form describes, or your Employees’ Pension Insurance enrollment period (including mutual-aid enrollment), is 6 months or more.
You do not have an address in Japan.
You were never eligible to receive a pension, including a disability allowance.

The form says you claim within two years from the date you no longer had an address in Japan. The English index says the same two-year idea as “within two years since you leave Japan.” If those two sentences ever look different on a later reprint, the claim form is the document you sign. Re-read it.

The form also says you cannot claim if your pension eligibility period is already 120 months (10 years) or more, because you can then receive a Japanese old-age pension. It says that if you do receive the lump-sum, all periods of Japanese pension coverage from before the claim are forfeited. A social-security totalization period can push the eligibility period to 120 months, and the form says a claim is then unavailable. The form’s list of totalization countries is marked as of March 2026, and it tells you to check the Japan Pension Service agreement page for the current list. This article does not copy that country list.

The form says the amount is calculated from months of coverage, with a maximum of 60 months (5 years) from April 2021. If the months being paid are only months before March 2021, the maximum it prints is 36 months. It warns that coverage beyond 60 months is still wiped out if you claim, even though the payment itself stops at the cap. The yen amounts are on the claim form and change with the contribution year. They are pension amounts, not the 20.42% tax. Read them on the form for the year of your last contribution.

Two practical points on the same form:

If you submit a moving-out notification (転出届, tenshutsu todoke) to the municipality, you can claim after leaving even with a re-entry permit. If you do not submit that notification, the form says you are still treated as a National Pension insured person until the re-entry permit expires, and you cannot claim until then.
If you send the claim from inside Japan before you leave, the Japan Pension Service has to receive it on a day when you have no address in Japan. The form says that means on or after the moving-out date, or the planned date your residence record is deleted. A mailed claim has to arrive after that date.

The English index prints the claim address as Japan Pension Service, 3-5-24, Takaido nishi, Suginami-ku, Tokyo 168-8505. Attachments listed on the form include a passport copy, proof that you no longer have an address in Japan (unless the moving-out notification already lets them see the deleted residence record), proof of a bank account in your own name, and a document that shows your Basic Pension Number.

That bank account is the account for the pension payment. It is part of the Japan Pension Service claim. It is a different step from the tax refund.

After a refund is paid in Japan

The tax-agent instructions say the agent receives national-tax refunds. The National Tax Agency’s refund Q&A says the same for the bank account: when a tax agent has been designated, the refund is paid into a deposit account in the tax agent’s name. The Q&A lists the kinds of institution a refund can be paid into: banks, Japan Post Bank (ゆうちょ銀行), shinkin banks, credit cooperatives, labor banks, agricultural cooperatives, and fishery cooperatives. It does not describe paying a refund into an account outside Japan, and this page does not say that it can be. No.12005 and the claim form describe the refund as something you pursue through that agent and the tax office.

Observation: moving yen from an account in Japan to an account abroad is a transfer at a bank or a money-transfer company. It is outside the return. A fee for that transfer does not change Article 171 or Article 173.

A short sequence

This is the order the two agencies describe. It is a general scenario for a person who has already left and then receives an Employees’ Pension lump-sum. It is not a statement that any one reader should file.

Confirm on the claim form that the pension conditions, including the two-year period and the effect on future Japanese pension periods, are the ones you are reading before you claim.
Claim from the Japan Pension Service. The payment of an Employees’ Pension lump-sum to a non-resident is the payment No.12005 describes as withheld at 20.42%. A National Pension lump-sum is the one the claim form says is not withheld.
Keep the original notice sent with the payment.
File the tax-agent notification with the tax office for your last address in Japan if you have not already filed it. The claim form says to include it with the return if you left without it. The appointment rules are in the leaving-Japan article.
On or after the Article 173 date, the agent can file return pages 1, 2, and 3 for that year, with the notice and the withholding statement Article 297 requires. The filled-in example is the National Tax Agency’s illustration for this pension payment.
The tax office refunds the Article 173 difference when the withheld tax is larger than the elected tax. This page does not predict that difference.

Official sources

The Primary sources list below is the set this page relies on. The 20.42% rate is the rate printed on No.12005 and on the Japan Pension Service claim form. The filing window is the one in Income Tax Act Article 173.