Dependent Eligibility Requirements

Dependent Eligibility Requirements: difference between Income Tax and Social Insurance Regulations

If your spouse is working part-time, how much can he / she make per year in order for him / her to qualify as your dependent? In Japan, the requirements differ between national income tax and social insurance regulations. For the former, a salary earner’s spouse qualifies as a dependent if the spouse’s gross annual income is JPY1,030,000 or less. In this case, the spouse’s monthly gross income is roughly calculated at JPY85,833 or less.

On the other hand, as dictated by rules governing social insurance (Employee’s Health and Pension Insurance), an insured employee’s spouse is qualified as a dependent if the spouse’s annual gross income is less than JPY1,300,000 (and less than 1/2 of the insured employee’s gross annual income). In this case, the spouse’s monthly gross income is calculated roughly at less than JPY108,333.

It is a common story in Japan that an employee’s dependent wife worked too much in December, beyond her allowable limit as a dependent for tax purposes, resulting in a significant increase in the tax deduction through Year-end tax adjustment. If you have a dependent spouse who works part-time, please keep this firmly in mind.

– Thanks to BCCJ member company Nagamine Mishima Accounting Office for this article.