Information about Income TaxInformation about Income Tax>No.12012 Overview of deduction for employment income

No.12012 Overview of deduction for employment income

Are wage earners allowed to subtract necessary expenses incurred for their work from the salary?

Employment income is calculated by subtracting the deduction for employment income from salaries and wages.

The amount of deduction for employment income is calculated using a fixed formula according to your salaries and wages. Therefore, actual expenses incurred are not subtracted when calculating employment income.

If your annual salaries and wages are less than 1,619,000 yen, 650,000 yen (as deduction for employment income) is subtracted from the amount.

For example, if your annual salaries and wages are 5,000,000 yen, the calculation is carried out as follows:

  1. (1) 5,000,000 yen / 4 = 1,250,000 yen (round down to the nearest 1,000)
  2. (2) 1,250,000 yen × 3.2 = 3,460,000 yen
  3. (3) The amount of employment income is obtained by the above calculation. The difference between the above amount and the amount of salaries and wages is the amount of deduction for employment income.
<<Reference>>
Calculation of the amount of employment income (for the year 2017)
Total
earnings (A)
Amount of
employment income
Total
earnings (A)
Amount of employment income
Up to
650,999
0 yen 1,628,000 to
1,799,999
A / 4 = B
(round down to the nearest 1,000)
B × 2.4
651,000 to
1,618,999
A − 650,000 1,800,000 to
3,599,999
B × 2.8 − 180,000
1,619,000 to
1,619,999
969,000 yen 3,600,000 to
6,599,999
B × 3.2 − 540,000
1,620,000 to
1,621,999
970,000 yen 6,600,000 to
9,999,999
A × 0.9 − 1,200,000
1,622,000 to
1,623,999
972,000 yen 10,000,000
or more
A − 2,200,000
1,624,000 to
1,627,999
974,000 yen    
Calculation of the amount of employment income (for the year 2016)
Total
earnings (A)
Amount of
employment income
Total
earnings (A)
Amount of employment income
Up to
650,999
0 yen 1,628,000 to
1,799,999
A / 4 = B
(round down to the nearest 1,000)
B × 2.4
651,000 to
1,618,999
A − 650,000 1,800,000 to
3,599,999
B × 2.8 − 180,000
1,619,000 to
1,619,999
969,000 yen 3,600,000 to
6,599,999
B × 3.2 − 540,000
1,620,000 to
1,621,999
970,000 yen 6,600,000 to
9,999,999
A × 0.9 − 1,200,000
1,622,000 to
1,623,999
972,000 yen 10,000,000
to 11,999,999
A × 0.95 − 1,700,000
1,624,000 to
1,627,999
974,000 yen 12,000,000
or more
A − 2,300,000
Calculation of the amount of employment income (for the years 2013 through 2015)
Total
earnings (A)
Amount of
employment income
Total
earnings (A)
Amount of employment income
Up to
650,999
0 yen 1,628,000 to
1,799,999
A / 4 = B
(round down to the nearest 1,000)
B × 2.4
651,000 to
1,618,999
A − 650,000 1,800,000 to
3,599,999
B × 2.8 − 180,000
1,619,000 to
1,619,999
969,000 yen 3,600,000 to
6,599,999
B × 3.2 − 540,000
1,620,000 to
1,621,999
970,000 yen 6,600,000 to
9,999,999
A × 0.9 − 1,200,000
1,622,000 to
1,623,999
972,000 yen 10,000,000
to 14,999,999
A × 0.95 − 1,700,000
1,624,000 to
1,627,999
974,000 yen 15,000,000
or more
A − 2,450,000