iDeCo Tax Savings Simulator

Estimates the annual income tax, reconstruction surtax, and resident tax saved from the full income-tax deduction for iDeCo contributions, plus the cumulative saving over your chosen number of contribution years.

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Calculation basis and official references

Reviewed on:

Formula basis

Annual saving = [incomeTax(taxable income) - incomeTax(max(0, taxable income - annual contribution))] x (1.021 if including the 2.1% reconstruction surtax) + annual contribution x 10% resident tax. Income tax uses the National Tax Agency's 7-bracket progressive schedule (5%-45%, each with a quick-calculation deduction) and is computed as an exact before/after difference, so bracket crossings and contributions larger than taxable income are both handled correctly. The contribution limit is the smaller of the category's individual iDeCo cap and the combined cap shared with any corporate DC employer contribution or DB-type plan's assumed contribution (JPY 55,000 or 62,000 per month depending on the year), minus the entered other-plan contribution.

Calculation method

Uses the full income-tax deduction available for iDeCo contributions (the small-business mutual aid / DC premium deduction) to estimate the annual income tax, reconstruction surtax, and resident tax saved within the contribution limit for the selected enrollment category and year, plus the cumulative saving over the chosen number of years.

Exclusions and checks required

  • Income tax and resident tax technically use slightly different taxable-income bases (e.g. different basic deduction amounts); this calculator simplifies by using a single entered taxable income for both.
  • When the contribution exceeds the taxable income, both the income tax and resident tax savings are capped at the amount actually offsettable (up to the taxable income itself), so the tool never overstates the saving.
  • The contribution-limit calculation uses the entered 'other plan's monthly contribution' figure as-is; the official assumed contribution for a corporate DC or DB-type plan should be confirmed with your employer's pension plan or mutual aid association.
  • Inputs where the monthly contribution exceeds the computed limit, is below JPY 5,000, or is not in JPY 1,000 increments are rejected and no result is shown.
  • iDeCo assets generally cannot be withdrawn before age 60. If your combined enrollment period at age 60 is under 10 years, the age at which you can start receiving benefits is pushed back further.
  • A lump-sum withdrawal at or after age 60 is subject to the retirement income deduction, including service-year adjustments when combined with other retirement payments. This calculator only estimates the saving while contributing and does not compute withdrawal-time taxation; see the 'Retirement payout tax' calculators (social:retirement-tax, tax:retirement-tax) for that.
  • The contribution-limit reform scheduled for December 1, 2026 (a further increase, abolition of the separate individual cap for enrollees with a corporate pension, and extending the eligible age to under 70) is already reflected in this calculator's 2027 year option, but it is pre-enactment-effective information and may still change.
  • The income tax brackets, reconstruction surtax rate, and standard resident tax rate reflect the rules in force as confirmed on 2026-08-01; check for updates in each year's tax reform outline (published every December).

Example input:：An employee with no corporate pension, taxable income of JPY 4,000,000, contributing JPY 23,000/month for 20 years

year
2026
occupationCategory
employeeNoPension
monthlyContributionYen
23000
otherPensionContributionYen
0
taxableIncomeMan
400
years
20
rounding
halfUp

The annual saving of JPY 83,959 (income tax JPY 55,200 + reconstruction surtax JPY 1,159 + resident tax JPY 27,600) and the 20-year cumulative saving of JPY 1,679,180 are estimates; your actual saving depends on your own tax filing and future tax reforms.

Official references

FAQ

Who is this calculator for? iDeCo Tax Savings Simulator

Estimates the annual income tax, reconstruction surtax, and resident tax saved from the full income-tax deduction for iDeCo contributions, plus the cumulative saving over your chosen number of contribution years.

What values should I enter?

Applies to: Tax Savings / Saving = [incomeTax(taxable income) - incomeTax(taxable income - annual contribution, floored at 0)] x (1.021 if including the reconstruction surtax) + annual contribution x 10% resident tax.

How should I interpret this estimate?

Uses the full income-tax deduction available for iDeCo contributions (the small-business mutual aid / DC premium deduction) to estimate the annual income tax, reconstruction surtax, and resident tax saved within the contribution limit for the selected enrollment category and year, plus the cumulative saving over the chosen number of years.

How to use

  1. Enter your input values and press Calculate.
  2. Review the result and compare it with expected context.
  3. Annual saving = [incomeTax(taxable income) - incomeTax(max(0, taxable income - annual contribution))] x (1.021 if including the 2.1% reconstruction surtax) + annual contribution x 10% resident tax. Income tax uses the National Tax Agency's 7-bracket progressive schedule (5%-45%, each with a quick-calculation deduction) and is computed as an exact before/after difference, so bracket crossings and contributions larger than taxable income are both handled correctly. The contribution limit is the smaller of the category's individual iDeCo cap and the combined cap shared with any corporate DC employer contribution or DB-type plan's assumed contribution (JPY 55,000 or 62,000 per month depending on the year), minus the entered other-plan contribution.

Official references