"Nenmatsu chousei" - year‐end tax adjustment for employees

If you work as an employee in Japan and you only get your income from the company you work for they will usually take care of your taxes. If you receive income from multiple sources you will usually have to care of taxes on your own and file a Kakutei Shinkoku.

In the former case, you will only be asked to fill out a Nenmatsu Chosei form. Nenmatsu Chosei means year‐end adjustment and is a process to adjust the taxes you paid during the year to your actual taxable income for the year.

You will receive the form from your company at the end of the year. In the simplest case, you only have to write your name and address. If certain circumstances apply to you we will have to write additional information.

Private insurance 

If you have any private insurances like private medical insurance or life insurance in Japan you are asked to write down the amount of insurance fee you paid in the current year. The insurance providers will send you a small piece of paper of the size of a postcard at the end of the year. Make sure to keep those as they will inform you of your insurance fees and also need to be pasted on your Nenmatsu Chosei form. Based on the amount of insurance fees you paid you will receive a tax exemption. There are two different insurance systems which come with different tax exemption and need to be filled out differently. Your insurance provider should inform you which system applies to your insurance. If you are unsure about how to fill in the form just ask the person in your company that is responsible for the Nenmatsu Chosei.

Dependents 

If you have children, a spouse that does have a yearly income below a certain threshold or other dependents you will have to fill out their information and their income. Depending on the number of dependents and their income you will receive tax exemption. Again if you are unsure if this applies to you just ask the person responsible in your company.

You will have to submit the filled out form until a certain deadline that differs from company to company. The company will take care of the rest. After the Nenmatsu Chosei is done you will either receive a tax refund or are asked to pay additional taxes. I have always received a refund up until now. The refund is usually paid out with your next regular salary.