jemfleming

New member
Hi there!

This sub-reddit has always been so helpful so I wanted to come back with just a couple final Qs that I haven't been able to find answers to after a lengthy search...

Quick background:

Spouse is on a work visa in her first year in a senior administration position at an international school in Tokyo. The contract is renewable on a year-to-year basis, and I (dependent) recently accepted a 28 hour per week fixed term contract for 20 weeks. During my negotiation, I made sure that my total income would fall beneath 1.3 million yen even if I worked 28 hours every week for all 20 weeks, which is unlikely given holidays and such. I was purposeful in not making any concrete employment plans beyond this because we will need to evaluate whether we would like to renew my spouse's contract and stay in Japan for another year.

However, after reviewing a previous response on the subject, I am now a bit concerned that my monthly income being over 108,000 yen (1.3 million yen/12 months) for consecutive months could cause issues. In addition, when I went to open an account at JP Post Bank, they insisted on knowing my salary on an annualized basis. I tried to explain that it was a part-time contract with a fixed term of 20 weeks to no avail. On the other hand, I told my spouse's employer that my employment status changed but I would not exceed the 1.3 million yen threshold. The contract that I submitted with my part-time work application obviously showed the same. No follow-up Qs from anyone.

Questions:

1.) Is it possible to "break through" the barrier by making a salary of over 108,000 yen for consecutive months even if it is quite literally impossible for me to actually make 1.3 million yen per the terms of my current contract?

2.) Assuming I am in the clear on the above question, are there any other barriers that I should try to avoid by asking to reduce my hours? I understand that the 1.03 million yen barrier has been removed and the 1.06 million yen barrier doesn't apply since my employer has fewer than 50 employees. Is it worth trying to stay below the 1.0 million yen barrier so that my individual earnings aren't subject to local inhabitants taxes?

Again, really appreciate all of the insight on here.
 
@jemfleming
Is it possible to "break through" the barrier by making a salary of over 108,000 yen for consecutive months even if it is quite literally impossible for me to actually make 1.3 million yen per the terms of my current contract?

Assuming you're referring to the 1.3 million yen threshold for dependent coverage under employees' health insurance and pension, yes. But it depends on the nature of the work.

If the work is inherently time-limited (such as a ski instructor or a translator working on the G7 summit), you can generally get away with exceeding 108,000 yen per month, because it's obvious from the nature of the work that it can't continue indefinitely.

But if the work is not inherently time-limited, then the fact your current contract is only for a few months doesn't necessarily mean you can get away with earning more than 108,000 yen per month. The test (for employees' health insurance purposes) is whether you are "currently earning" more than 1.3 million yen per year, not whether you are contractually entitled to earn more than 1.3 million yen per year.

At the same time, there is some variation between health insurers regarding how the 1.3 million yen threshold is interpreted. So it's difficult to provide definitive information. Typically, the best approach is to just be honest with your spouse's employer regarding your work situation (e.g., 20-week contract at X/month) and see what they say. If they're happy for you to remain as a dependent, then you don't have anything to worry about.

Is it worth trying to stay below the 1.0 million yen barrier so that my individual earnings aren't subject to local inhabitants taxes?

Not really. I don't think there are any other barriers that have significant financial consequences.
 
@jemfleming It seems there has been (or is going to be) a change in the laws. The 1.3m barrier has been (or will be) removed for the 2023 and 2024 as the pension laws are being updated in 2025.
 
@withlovekar As long as your employer certifies that your increased income (above 1.3 million yen/year) is temporary, it should be possible for an insurer to approve dependent coverage from this month, according to the plan announced by the MHLW.
 

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