Japan Labor Cost Calculator 2026
Enter a monthly salary in yen or US dollars to estimate the employer’s statutory cost and the employee’s net pay in Japan, using 2026 rates.
All values are for reference only. Please contact us for more information.
How the Japan calculator works
The calculator applies the 2026 rates for an employee under 40 who works in Tokyo for a general (office-type) business, insured with the Japan Health Insurance Association (Kyokai Kenpo). Enter the monthly gross salary and press Calculate. On a salary of ¥320,000, for example, the employer pays ¥50,240 in contributions, 15.7% on top of salary.
| Calculator line | What it includes | Rate in 2026 |
|---|---|---|
| Employer social security | Health insurance, employees’ pension, the child support levy, the employer-only child-rearing contribution, employment insurance and workers’ accident insurance | About 15.7% of salary |
| Employee social security | The employee’s share of health insurance, pension and the child support levy, plus employment insurance | About 14.7% of salary |
| Employee tax | An estimate of the tax withheld from pay each month | Depends on income, dependants and the previous year’s income |
| Net monthly salary | Gross salary less the employee’s contributions and tax | – |
Rates: Japan Health Insurance Association (Tokyo), Japan Pension Service and MHLW employment insurance rates. The US dollar figures use an indicative exchange rate.
What the estimate leaves out
The result is the statutory part of the cost for one month. A real offer usually adds more, so treat it as a floor, not a budget.
- Long-term care insurance. Employees aged 40 to 64 pay another 0.81%, and so does the employer.
- Location and industry. Health insurance rates differ by prefecture and by health insurance society. Construction, agriculture and some other industries have higher employment and accident insurance rates.
- Bonuses and allowances. Summer and winter bonuses, commuting allowance and overtime are customary in Japan, and contributions apply to them too.
- Contribution bands. Social insurance is charged on a band of pay, called standard monthly remuneration, rather than the exact salary, so payroll can differ by a few hundred yen. The pension contribution stops rising at a standard monthly pay of ¥650,000.
- The provider’s fee. If you hire through an employer of record, its monthly service fee is charged on top.
For worked examples, caps on bonuses and a comparison with setting up your own company, read the Japan EOR cost guide.
Questions about employer costs in Japan
How much does it cost to employ someone in Japan on top of salary?
In Tokyo in 2026, employer social insurance and labour insurance add about 15.7% of salary for an employee under 40 and about 16.5% for an employee aged 40 to 64. On high salaries the percentage falls, because the pension contribution is capped. Bonuses, a commuting allowance and overtime come on top.
Does the calculator include long-term care insurance?
No. It assumes an employee under 40. For an employee aged 40 to 64, add 0.81% of salary for the employer and the same for the employee.
Why is the employee tax figure only an estimate?
Income tax withheld each month depends on the employee’s dependants and declarations, and resident tax is based on the previous year’s income in Japan. Someone new to Japan usually pays no resident tax until the June after their first calendar year of income in Japan.
Can I use this to budget a hire through an employer of record?
Yes, for the salary and statutory contributions, which are passed through at cost. Add the provider’s monthly service fee, any bonuses and allowances you plan to pay, and a refundable deposit. Request a proposal and we will send the full cost line by line.
Do I need a Japanese company to hire this employee?
No. An employer of record can employ the person for you and run payroll, tax and social insurance. Because the employee works under your direction, Japan treats this as worker dispatch, which has rules on jobs, duration and equal pay. See how our Japan employer of record service works.
Planning a hire in Japan?
Tell us the role, the work location and the package. We will send the employment cost in yen and US dollars and our service fee, before you commit.