Retirement Allowance & Pension Schemes in Japan
Providing retirement benefits in Japan is not just a perk—it’s a strategic, tax-efficient tool for both employers and employees. SBC Group offers customized retirement allowance life insurance schemesthat comply with Japanese law while maximizing tax savings and long-term security.
Whether you’re a domestic business or a foreign company employing staff in Japan, we help you plan, implement, and manage structured retirement benefit programs for executive and employee tiers alike.
What is a Retirement Allowance Scheme?
A Retirement Allowance Scheme(退職金制度) in Japan allows companies to:
- Set aside pre-tax funds over time to pay employees a lump-sum retirement benefit
- Use life insurance products (approved by the Ministry of Finance) as funding vehicles
- Reduce corporate tax liability while providing meaningful employee benefits
These schemes are common among Japanese corporations and are increasingly used by foreign-owned businesses for employee retention and tax efficiency.
Benefits of a Structured Scheme
| For Employers | For Employees |
| Tax-deductible contributions | Guaranteed lump-sum benefit at retirement |
| Improved retention and recruitment | Tax-favorable treatment of benefit payments |
| Predictable benefit liabilities | Increased job satisfaction and loyalty |
| Enhanced company reputation | Long-term financial security |
What SBC Provides
✅ Scheme Design
Customized plan aligned with your business size, goals, and employee structure
✅ Insurance Brokerage
Licensed as a Life Insurance Broker by Japan’s Ministry of Finance (via Sumida Brokers & Consulting)
✅ Documentation & Compliance
Preparation of all legal documents, contracts, and compliance filings
✅ Review & Optimization
Regular performance evaluation, benefit adjustments, and tax impact analysis
✅ Multi-language Support
English and Japanese service for foreign executives and HR teams
Who Is Eligible?
These schemes are ideal for:
- Executive-level staff and founders
- Foreign executives working under Japanese contracts
- Japanese employees seeking structured retirement planning
- Companies wishing to offer top-tier employee benefits and tax optimization
Legal & Tax Framework in Japan
- Contributions to qualifying insurance-based retirement schemes are tax-deductiblefor the company
- Retirement lump-sum payments are taxed at preferential ratesfor recipients
- Payments are typically made upon retirement, resignation, or under pre-defined triggers (e.g., disability)
SBC ensures that your structure is fully compliantwith Japanese labor, tax, and insurance laws.
Why SBC Group?
Licensed Insurance Advisory
We are authorized by the Ministry of Finance to design and implement these schemes
Integrated Tax & HR Expertise
We combine retirement planning with payroll, tax filing, and HR compliance
Legacy & Trust
Part of the Sumida Tax & Accounting legacy, active since 1927
Strategic Guidance
We go beyond administration—we help you align retirement planning with your broader business and tax strategy
Let’s Build a Future-Focused Retirement Plan
Protect your people, strengthen retention, and optimize your company’s tax position with a custom-designed retirement allowance plan.
Contact Information
- 4-3-9 Nihonbashimuromachi, Chuo-ku, Tokyo 103-0022
- contactus@sbc.gr.jp
- +(81) 3 6262 5444