I still remember opening my first payslip in Japan and just staring at it. I was not exactly a fresh graduate anymore, but that number on the contract I signed and the number that actually landed in my bank account were two very different things. Nobody warned me. My agency did not warn me. My Japanese coworkers assumed I already knew, because for them this is just common sense, something they grew up hearing from their parents.
I have worked in a few different companies here over the years, and I have mentored enough younger Filipinos to know this confusion never really goes away on its own. It gets passed down instead. New hire assumes the salary on the job offer is what she will bring home, gets a shock on payday, then two or three years later she is the senpai explaining it to someone even newer. So let me just say it plainly, the way I wish someone had said it to me.
The number on your contract is not your take home pay
When a company in Japan offers you a monthly salary, that is your gross salary, kyuuyo gaku. It is the number before anything is taken out. What actually gets deposited into your account, your take home pay or tedori, is smaller, sometimes by quite a lot.
The deductions usually include:
- Health insurance (kenko hoken or, if your company is smaller, kokumin kenko hoken)
- Pension (kosei nenkin)
- Employment insurance (koyou hoken)
- Income tax (shotokuzei)
- Resident tax (juuminzei), though this one has a twist I will explain below
Add these up and it is not unusual to see ten to fifteen percent of your gross pay disappear before you even see it. If your contract says 250,000 yen a month, do not plan your budget around 250,000 yen. Plan around something closer to 210,000 to 220,000, and adjust once you actually see a real payslip.
The trap that catches almost everyone in year two
Here is the part that really gets people, and it caught me too. Resident tax in Japan is based on what you earned the previous year, but it is not deducted starting from your first paycheck. It usually kicks in around June of your second year working, based on your income from the year before.
So your first year, your take home pay feels okay, manageable even. You get used to it. Then in your second June, a new deduction quietly appears on your payslip and your take home pay drops again, sometimes by ten thousand yen a month or more, without any change to your actual salary. People panic, think there was a mistake, call HR confused. There is no mistake. It is just resident tax finally catching up to you.
If you know this in advance, you can prepare. Set aside a little extra during your first year instead of spending everything, so the second year adjustment does not hurt as much.
Why your Japanese payslip looks so different from what you are used to
Back home, a lot of jobs are simpler on paper, your salary is closer to what you actually receive, especially in less formal arrangements. In Japan, the payslip, kyuuyo meisai, is very detailed and very official. Learning to read it is honestly a useful skill on its own. Look for these sections:
- Shikyu (payments): your base salary plus any allowances like transportation
- Koujo (deductions): all the insurance, pension, and tax items listed above
- Sashihiki shikyu gaku: the final number, your actual take home pay
Once you can read these three sections, the whole mystery disappears. I tell people to keep every payslip, even the paper ones, in a folder. You will need past payslips for visa renewals, apartment applications, and loan applications more often than you think.
A few things that helped me and the people I have mentored
Ask for the gross to net breakdown before accepting a job, not after. A good employer or a reputable agency will not hesitate to explain this to you. If they get vague or annoyed when you ask, treat that as information too.
Do not compare your Japanese salary directly to a Philippine salary using the exchange rate alone. Cost of living, insurance coverage, and pension contributions are part of the real value of the job, even though they do not show up as cash in your hand.
If your company handles nenkin (pension) contributions and you eventually return to the Philippines for good, look into the lump sum withdrawal payment system before you leave. It is a way to get back some of what you paid into the pension system, and a lot of people miss this simply because nobody told them it exists.
Talk to other Filipinos who have already been through their first and second year here. Not to compare salaries, which can get awkward, but to compare what surprised them. Everyone remembers their own version of the payslip shock, and everyone has a tip or two worth hearing.
Where to go from here
Understanding your payslip is really just the first step. If you are also sorting out health insurance enrollment, pension questions, or looking for a tax consultant or accounting service that regularly works with Filipinos in Japan, our directory has listings for exactly that kind of support, people who are used to explaining these things in a way that actually makes sense the first time around.
