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iDeCo Tax-Saving Simulator Tool

Enter your age, annual income, occupation, monthly contribution and expected return to instantly estimate the annual tax savings, cumulative savings until you stop contributing (age 60 to 70), and compound investment growth of iDeCo (Japan's individual defined contribution pension). Savings are the difference between your income and resident tax with and without iDeCo under the 2026 rules. The contribution cap adjusts automatically by occupation, including the higher caps from December 2026.

Last updated: 2026/10/16 Finance Feedback & bug reports
Tax year
Covers contributions debited from January to December 2026 (for December 2025 to November 2026), at the current caps. The resident tax cut applies to fiscal 2027 (from June 2027). In 2026, monthly withholding still uses the old rules and is settled at the December year-end adjustment (or tax return). Social insurance uses fiscal 2026 rates for the whole year.
yrs
Contribute until
National Pension insured persons (self-employed, employees, public servants, dependent spouses) can generally contribute until they turn 60.
×10,000 JPY
Social insurance is estimated from Japan Health Insurance Association (Tokyo), Employees' Pension and employment insurance rates (no bonuses, single).
The monthly contribution cap changes by occupation.
JPY
%
Expected return of your iDeCo products. ~0% for principal-guaranteed, 3-5% for equity index funds as a rough guide.
Estimated Annual Tax Savings
-
Roughly how much your income + resident tax is reduced each year
Cumulative Savings to Age 60
-
Savings Rate on Contributions (income + resident)
-
Contribution Cap (monthly)
-
Annual Contribution
-
Total Principal (to age 60)
-
Estimated Investment Gain
-
Estimated Assets at Age 60
-
Tax-Saving Breakdown (annual)
Income Tax Reduced -
Resident Tax Reduced -
The difference between your tax with and without iDeCo. The income tax part includes the 2.1% special reconstruction surtax; the resident tax part is the cut for fiscal 2027 (from June 2027).

Accumulation & Growth Schedule (estimate)

Age Principal Gain Est. Assets Cumulative Tax Savings

An estimate assuming a constant return and the same income, contribution and tax rules every year; actual values vary with markets and reforms. Shows roughly every 5 years plus the point you stop contributing.

Contributions are fully deductible (small-business mutual aid premium deduction). While investment gains are tax-free during accumulation, withdrawals from age 60 may be taxed after applying the retirement income or public pension deductions.

Monthly Contribution Caps by Occupation

Occupation Through Nov 2026 From Dec 2026debited from Jan 2027
Self-employed / Freelance (Category 1) 68,000 JPY 75,000 JPY
Employee (no corporate pension) 23,000 JPY 62,000 JPY
Employee (corporate DC only) 20,000 JPY*1 62,000 JPY minus corporate pension contribution*2
Employee (DB or other corporate pension) 20,000 JPY*1 62,000 JPY minus corporate pension contribution*2
Public servant 20,000 JPY 54,000 JPY
Homemaker (Category 3) 23,000 JPY 23,000 JPY(no change)

*1 If employer DC contributions plus the DB-equivalent amount exceed 35,000 JPY a month, the cap is 55,000 JPY minus that total. *2 Employer DC contributions plus the DB-equivalent amount. The self-employed cap is shared with the National Pension Fund and additional premiums. Public servants: 62,000 JPY minus the 8,000 JPY mutual-aid equivalent = 54,000 JPY (private school staff: minus 7,000 JPY = 55,000 JPY). Contributions start at 5,000 JPY in 1,000 JPY steps; the annual cap is 12 times the monthly cap.

Withdrawal (Exit) Overview

iDeCo payouts generally start between age 60 and 75. Gains are tax-free during accumulation, but withdrawals are taxable depending on the payout method, each with a large deduction available.

  • Lump-sum withdrawal: the retirement income deduction applies, and tax is charged on half of the amount remaining after a deduction based on years of participation.
  • Annuity withdrawal: the public pension deduction applies, combined with your other public pensions.
  • You can also combine lump-sum and annuity payouts, and a smart exit strategy that uses both allowances is key to minimizing tax.
  • Order with a retirement allowance (from January 2026): if you take the iDeCo lump sum first and receive a company retirement allowance later, and the iDeCo lump sum was paid within the 9 years before the year of the allowance (4 years before the reform), the overlapping service period is adjusted in the retirement income deduction (the so-called 5-year rule became a 10-year rule). This applies to iDeCo lump sums received on or after January 1, 2026.

The tax at withdrawal varies with other retirement/pension income and the year received. This overview is general information, not individual tax advice.

Tools & Guides to Use Together

Once you see the iDeCo tax benefit, compare it with the NISA simulator to decide how to split your tax-free investing. Use the compound interest tool to see long-term growth, and the take-home pay calculator to see how contributions affect your net pay. To learn more, read the iDeCo tax-saving guide and the NISA vs. iDeCo comparison.

Important Notes
  • Results are an approximate estimate only and do not guarantee actual tax savings, investment returns, or future asset value.
  • Tax savings are the difference between income tax (including the reconstruction surtax) and resident tax calculated with and without iDeCo, based on taxable income after the employment income deduction, estimated social insurance and the basic deduction. A single person with no other deductions is assumed.
  • For 2026, income tax uses the reformed basic deduction (1.04 million JPY for total income up to 4.89 million JPY, and so on) and employment income deduction (minimum 740,000 JPY); resident tax uses the 430,000 JPY basic deduction. Employee social insurance is estimated with fiscal 2026 Japan Health Insurance Association (Tokyo) rates for a full year, and self-employed social insurance with the National Pension premium (17,920 JPY a month in fiscal 2026) plus an approximate National Health Insurance premium; actual rates vary by month and municipality.
  • iDeCo funds generally cannot be withdrawn before age 60. Withdrawals may be taxed after retirement income or public pension deductions, and account fees apply.
  • This tool is not tax or investment advice. Confirm exact figures and rules with a tax professional, financial institution, or the relevant authority.
  • All calculations run in your browser; your inputs are never sent to any server.
Sources (as of October 2026)

How to Use

1

Enter Age & Income

Enter your current age and annual gross salary (including bonuses). If you are self-employed, enter your income after expenses.

2

Choose Occupation & Contribution

Selecting an occupation sets the monthly contribution cap. Choose "2027" to use the higher caps from December 2026, and "Contribute until" to extend contributions to 65 or 70.

3

Check Savings & Growth

The annual tax savings (the tax difference with and without iDeCo), cumulative savings, and compound investment gain update instantly as you type.

About the iDeCo Tax-Saving Simulator

iDeCo is Japan's individual defined contribution pension, a private pension you build yourself. Its biggest benefit is that monthly contributions are fully deductible as a small-business mutual aid premium deduction, reducing income and resident tax. This tool works out your annual tax savings as the difference between your tax with and without iDeCo, and shows cumulative savings and compound investment growth instantly in your browser. It reflects the 2026 income tax reform, the higher caps from December 2026, and contributions up to age 70.

Features

  • Real-time CalculationSavings and investment estimates recalculate instantly as you change income, contribution or return.
  • Caps by OccupationReflects the different caps for the self-employed, employees, public servants and homemakers, both now and after the December 2026 increase.
  • Savings + GrowthShows the tax savings from the with/without-iDeCo tax difference together with the future compound investment gain and asset estimate.
  • Privacy ProtectedAll calculations run in your browser. Your income inputs are never sent to a server.

Use Cases

  • Estimate how much you can save in tax before starting iDeCo
  • Compare the balance of tax savings vs. accumulation for different contribution amounts
  • Decide whether to raise your contribution when caps increase in December 2026
  • Decide whether to prioritize NISA or iDeCo by checking the tax benefit
  • See how the expected return and how long you contribute (to age 60-70) change your future assets

FAQ

How are the iDeCo tax savings calculated?
We derive taxable income from your gross income (minus the employment income deduction, estimated social insurance and the basic deduction), calculate income tax (including the 2.1% reconstruction surtax) and resident tax with and without your iDeCo contribution, and show the difference as your savings. This correctly handles cases that cross a tax bracket or where taxable income is smaller than the contribution. For 2026 we use the reformed basic deduction (1.04 million JPY for total income up to 4.89 million JPY, and so on) and employment income deduction (minimum 740,000 JPY).
What is the contribution cap?
It depends on occupation and timing. Through November 2026: self-employed/freelance (Category 1) 68,000 JPY a month; employees without a corporate pension and homemakers (Category 3) 23,000 JPY; employees with a corporate pension and public servants 20,000 JPY (employees with DB plans and public servants rose from 12,000 JPY in December 2024). From the December 2026 contribution (debited in January 2027): Category 1 75,000 JPY, employees without a corporate pension 62,000 JPY, employees with a corporate pension 62,000 JPY minus their corporate pension contribution, and public servants 54,000 JPY. Category 3 stays at 23,000 JPY.
What changes in iDeCo from December 2026?
From the December 2026 contribution (debited in January 2027), caps rise: employees without a corporate pension from 23,000 to 62,000 JPY a month, the self-employed from 68,000 to 75,000 JPY, public servants from 20,000 to 54,000 JPY, and so on (homemakers stay at 23,000 JPY). In addition, people aged 60 to 69 who are iDeCo members or investment-instruction holders, or who move corporate pension assets into iDeCo, can join and contribute until 70 if they are not receiving the old-age basic pension or iDeCo old-age benefits. In this tool, choose "2027" to use the new caps and "Contribute until" to extend contributions to 65 or 70.
Can a homemaker save tax with iDeCo?
Those with little income (such as full-time homemakers) pay little or no income/resident tax, so the deduction provides little tax benefit. In 2026, salary income up to 1.19 million JPY is free of resident tax and up to 1.78 million JPY is free of income tax (single, no social insurance). However, the tax-free investment growth and building a future pension are still meaningful advantages.
How is the investment gain calculated?
We assume your monthly contribution is invested with monthly compounding at the entered annual return until the age you stop contributing (60, 65 or 70), compute the future value, and subtract the total principal to show the estimated gain. It assumes a constant return; actual results vary.
Is iDeCo taxed when I receive it?
Yes. Growth is tax-free during accumulation, but withdrawals from age 60 are taxable. Lump-sum withdrawals use the retirement income deduction, while annuity withdrawals use the public pension deduction, so taxes can be minimized within those allowances. From January 2026, if a company retirement allowance comes less than 10 years after an iDeCo lump sum (within the 9 years before the year of the allowance), the overlapping service period is adjusted in the retirement income deduction (previously less than 5 years). The payout method and order matter.
Should I prioritize NISA or iDeCo?
iDeCo offers a strong tax benefit because contributions are deductible, but funds are locked until around age 60. NISA can be withdrawn anytime but has no contribution deduction. A common approach is iDeCo for retirement funds you will not need soon, and NISA for money where you want liquidity. Use this tool's savings figure to compare.
Is my data saved or sent anywhere?
No. All calculations run entirely in your browser, and your inputs such as income are never sent to or stored on any server.
How do I read the income tax vs. resident tax breakdown?
The tool calculates your tax with and without iDeCo and splits the difference into an "income tax reduced" portion and a "resident tax reduced" portion. The income tax part is roughly the annual contribution times your rate (5-45%) times 1.021, and the resident tax part is roughly 10% of the annual contribution. If your taxable income is smaller than the contribution or you cross a bracket, the saving is smaller than a simple "contribution x rate". See the NISA vs. iDeCo guide to compare with NISA.
What does the accumulation & growth schedule show?
It divides the period from your current age to the age you stop contributing (60, 65 or 70) into roughly 5-year steps and shows the principal, estimated assets at your chosen return, gain, and cumulative tax savings at each point. It assumes a constant return, so actual values vary. You can also explore long-term compounding with the compound interest tool.

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