Life Insurance Premium Deduction 2026: Complete Guide to Seimei Hoken Deduction, 3 Categories & ¥120,000 Tax Savings
If you have life insurance in Japan, you may be eligible for up to ¥120,000 in annual income deductions (seimei hoken-ryō kōjo). This translates to significant savings on both income and residence taxes. Yet many people don't claim this deduction. Proper application often results in tax refunds or reductions worth tens of thousands of yen.
Disclaimer: This article provides general information only and does not constitute tax or legal advice. Please consult a qualified tax professional (zeirishi) for advice specific to your situation. Information is based on official National Tax Agency (NTA) sources and current as of February 2026. Disclosure: This article is published by Denpyo, a receipt and expense management service.
Introduction: Save Up to ¥120,000 with Life Insurance Premium Deductions
"I have life insurance, but does it reduce my taxes?" "Where do I find my deduction certificate?"
If you have life insurance in Japan, you may be eligible for up to ¥120,000 in annual income deductions (seimei hoken-ryō kōjo). This translates to significant savings on both income and residence taxes.
Yet many people don't claim this deduction. Proper application often results in tax refunds or reductions worth tens of thousands of yen.
The key is understanding the three deduction categories and how to calculate the correct deduction amount for each.
What you'll learn in this article:
- The three life insurance deduction categories and their maximum amounts
- How to find and read your deduction certificate
- How to calculate deductions for multiple policies
- Step-by-step tax filing procedures
- Common mistakes to avoid
- FAQs for expats
1. What is Life Insurance Premium Deduction?
1.1 Understanding the Basics
The life insurance premium deduction (seimei hoken-ryō kōjo) is a system that allows you to deduct paid life insurance premiums from your taxable income.
Key Characteristics:
- One of several income deductions available in Japan
- Claimed via year-end adjustment (nenmatsu chōsei) or tax filing (kakutei shinkoku)
- Deduction amount varies based on total annual premiums paid
- Applies to both employees and self-employed individuals
1.2 Eligibility Requirements
| Requirement | Details |
|---|---|
| Policyholder | Yourself or your spouse |
| Beneficiary | Yourself, spouse, or your dependent |
| Premiums Paid | Only premiums you actually paid qualify |
Important Note: If you paid life insurance premiums for your spouse or family members, you can claim the deduction for those amounts.
1.3 Why Does This Deduction Exist?
Life insurance premiums are relatively high compared to other expenses, and insurance is considered essential for financial security. The government offers this deduction to encourage responsible insurance coverage among Japanese residents and workers.
2. The Three Categories of Life Insurance Deductions
2.1 Overview of All Three Categories
Life insurance premium deductions fall into three distinct categories, each with different maximum deduction amounts.
| Category | Insurance Type | Maximum Deduction |
|---|---|---|
| General Life Insurance (Ippan Seimei Hoken) | Term, whole life, income protection | ¥40,000 |
| Medical Care Insurance (Kaigo Iryō Hoken) | Medical, cancer, nursing care insurance | ¥40,000 |
| Individual Pension Insurance (Kojin Nenkin Hoken) | Tax-qualified individual pension insurance | ¥40,000 |
| Total Maximum | ¥120,000 |
2.2 General Life Insurance Premium Deduction
Applicable Insurance Types:
- Term insurance (teiki hoken) — limited duration death benefit
- Whole life insurance (shūshin hoken) — lifetime death benefit
- Income protection insurance (shotoku hosho hoken)
- Variable insurance (hendōgaku hoken)
Maximum Deduction: ¥40,000 per year
Calculation Table:
| Annual Premium Paid | Deduction Amount |
|---|---|
| Up to ¥20,000 | Full amount paid |
| ¥20,001 - ¥40,000 | (Premium ÷ 2) + ¥10,000 |
| ¥40,001 - ¥80,000 | (Premium ÷ 4) + ¥20,000 |
| Over ¥80,000 | ¥40,000 (maximum) |
Example: Annual premium ¥60,000
Deduction = (60,000 ÷ 4) + 20,000 = ¥35,000
2.3 Medical Care Insurance Premium Deduction
Applicable Insurance Types:
- Medical insurance (iryō hoken) — hospitalization and surgery benefits
- Cancer insurance (gan hoken)
- Nursing care insurance (kaigo hoken)
- Disease insurance (shippei hoken)
Maximum Deduction: ¥40,000 per year
Calculation Method: Same as general life insurance (see calculation table above)
2.4 Individual Pension Insurance Premium Deduction
Important Conditions: To claim this deduction, your policy MUST meet ALL these requirements:
- Tax-Qualified Type — Insurance company designates as "tax-qualified" (zeisei tekigō-gata)
- Minimum 10-Year Term — Coverage period is at least 10 years
- Minimum 10-Year Payout Period — Pension payments extend at least 10 years
- Proper Beneficiary — You or your spouse receives the benefits
Maximum Deduction: ¥40,000 per year
Calculation Method: Same as general life insurance
Important: If your individual pension insurance is NOT "tax-qualified," you cannot claim this deduction. Check your policy documents or deduction certificate (kōjo shōmei-sho).
3. How to Find and Read Your Deduction Certificate
3.1 What is a Deduction Certificate?
A deduction certificate (kōjo shōmei-sho) is an official document issued by your life insurance company.
This certificate contains the exact deductible amount you can claim on your tax return. The amount shown is legally verified and accepted by the tax authorities.
3.2 When You Receive Your Certificate
| Timing | Details |
|---|---|
| Annually (Oct-Nov) | Certificate for next year's tax filing mailed to you |
| Specific Dates | Varies slightly by insurance company |
If You Haven't Received It:
- Check if your address on file is correct
- Contact your insurance company's customer service
- Request reissuance via phone, online portal, or in-person visit
3.3 How to Read Your Deduction Certificate
A typical deduction certificate includes:
Key Information:
- Policyholder name — Who the insurance is for
- Insured person name — The covered individual
- Insurance type — Critical for category determination
- Annual premium paid — Used to calculate deduction
- Total annual premiums — If multiple policies listed
- Coverage period — Dates of insurance
- Deductible amount — You can use this directly on your tax return
Multiple Policies: One certificate may list multiple insurance policies.
3.4 If You Lost Your Certificate
If you've lost your deduction certificate, always request reissuance from your insurance company.
Reissuance Options:
- Call your insurance company's customer service
- Apply online through their website portal
- Visit a company office in person
Processing Time: Typically 1-2 weeks
4. Calculating Deductions for Multiple Policies
4.1 Multiple Policies Calculation
If a single insurance policy includes multiple coverage types (for example, term insurance + medical rider), they may be classified in different deduction categories based on the specific coverage type.
Example: Policy with both death and medical coverage
Policy: ¥60,000 annual premium ├─ Death benefit coverage → Category: General Life Insurance └─ Medical coverage → Category: Medical Care Insurance
In this case, you must calculate and categorize separately.
4.2 Example Calculation Across All Three Categories
Scenario: You have three separate insurance policies
| Policy | Annual Premium | Category | Calculated Deduction |
|---|---|---|---|
| Whole Life | ¥100,000 | General Life | ¥40,000 |
| Medical | ¥60,000 | Medical Care | ¥35,000 |
| Pension (tax-qualified) | ¥80,000 | Individual Pension | ¥40,000 |
| Totals | ¥240,000 | ¥115,000 |
Calculation Details:
- Whole life: ¥100,000 exceeds ¥80,000 threshold → max ¥40,000
- Medical: (¥60,000 ÷ 4) + ¥20,000 = ¥35,000
- Pension: ¥80,000 = ¥40,000 (maxes out)
5. How to Claim on Your Tax Return
5.1 Available Claiming Methods
| Method | Who Uses It |
|---|---|
| Year-End Adjustment (nenmatsu chōsei) | Employees (most common) |
| Tax Filing (kakutei shinkoku) | Self-employed, those required to file |
| e-Tax (electronic filing) | Anyone with digital access |
5.2 Claiming via Year-End Adjustment
Step 1: Gather Documents
- Deduction certificate(s) from your insurance company
- Employee insurance deduction declaration form (provided by employer)
Step 2: Complete the Form
- Transfer information from your deduction certificate
- Calculate deduction amount for each category using the tables
- Ensure categories are correctly identified
Step 3: Submit to Employer
- Provide to your company's HR or payroll department
- Attach the original deduction certificate
- Submission deadline: Typically late November to early December
5.3 Claiming via Tax Filing (e-Tax)
Recommended Method: e-Tax Electronic Filing
- Access the Tax Return Preparation Corner
- Select "Income Tax" → "Return Form B"
- Locate "Life Insurance Premium Deduction" in the deductions section
- Input details from your deduction certificate(s)
- System automatically calculates deductible amounts — verify them
- Sign with My Number Card and submit via e-Tax
Alternative: Paper Filing
- Complete tax return forms (Form A and Form B)
- Attach original deduction certificate
- Submit to your local tax office
Filing Deadline: March 16, 2026 (Monday)
5.4 Required Documents for Filing
| Document | How to Obtain |
|---|---|
| Deduction Certificate | Mailed by insurance company annually |
| Insurance Deduction Form | Provided by employer (year-end adjustment) |
| Tax Return Form B | Download from NTA website |
| My Number Card | Obtain from municipal office |
6. Common Mistakes to Avoid
6.1 Mistake 1: Confusing Premiums with Deductible Amount
Common Error: Thinking annual premium ¥100,000 = deduction ¥100,000
Correct Understanding: Annual premium ¥100,000 = maximum deduction ¥40,000
How to Avoid: Use the "Deductible Amount" listed on your deduction certificate directly. Don't calculate from premiums unless absolutely necessary.
6.2 Mistake 2: Wrong Category Classification
Common Error: Listing medical insurance as "general life insurance"
Correct Understanding: Medical insurance belongs in "medical care insurance" category
How to Avoid: Always check the insurance type listed on your deduction certificate. Contact your insurer if unclear.
6.3 Mistake 3: Claiming Maximum for All Categories
Common Error: Claiming ¥120,000 total deduction when total premiums paid are only ¥50,000
Correct Understanding: Deductions are based on premiums actually paid. You cannot deduct more than you paid.
How to Avoid: Verify premiums for each category separately. Calculate precisely using the provided tables.
6.4 Mistake 4: Forgetting to Attach Certificate
Risk: Tax office requests the certificate after you've filed
Prevention:
- Paper filing: Always attach original deduction certificate
- e-Tax: Keep certificate at home (not required to submit, but retain for 5 years)
6.5 Mistake 5: Not Claiming Spouse/Family Premiums
Common Error: Thinking "I pay for my spouse's insurance, so I can't claim it"
Correct Understanding: The person who pays claims the deduction. You can claim deductions for spouse or family member premiums you paid.
How to Avoid: Include all premiums you personally paid in your deduction claim.
6.6 Mistake 6: Forgetting Other Deductions
Situation: You claimed life insurance deduction but forgot medical expense deduction
Important: Medical expense deductions cannot be claimed via year-end adjustment. You must file separately if you have qualifying medical expenses.
Prevention: Keep medical receipts and file separately for medical deductions.
7. How Much You Actually Save
7.1 Tax Savings Simulation
Scenario: Single employee, ¥5 million annual income
- General life insurance premium: ¥80,000/year
- Medical insurance premium: ¥60,000/year
| Item | Amount |
|---|---|
| General Life Insurance Premium | ¥80,000 |
| Medical Insurance Premium | ¥60,000 |
| Total Deduction Calculated | |
| ├─ General Category | ¥40,000 (max) |
| └─ Medical Care Category | ¥35,000 |
| Total Deduction | ¥75,000 |
Income Tax Savings: ¥75,000 × 10% (income tax bracket) = ¥7,500 annual savings
Residence Tax Savings: ¥75,000 × 10% (residence tax rate) = ¥7,500 annual savings
Total Annual Savings: ¥15,000
7.2 Estimated Savings by Annual Income
With ¥75,000 total life insurance deduction:
| Annual Income | Income Tax Rate | Income Tax Savings | Residence Tax Savings | Total Savings |
|---|---|---|---|---|
| ¥3,000,000 | 5% | ¥3,750 | ¥7,500 | ¥11,250 |
| ¥5,000,000 | 10% | ¥7,500 | ¥7,500 | ¥15,000 |
| ¥7,000,000 | 20% | ¥15,000 | ¥7,500 | ¥22,500 |
| ¥10,000,000 | 23% | ¥17,250 | ¥7,500 | ¥24,750 |
8. Frequently Asked Questions (FAQ)
Q1: Can I claim deductions for term (non-accumulating) life insurance?
A: Yes, absolutely. Term insurance is actually a primary target for this deduction. Both term and whole life insurance premiums qualify for deduction regardless of whether they have cash value.
Q2: Can I claim deductions if my insurance has a cash value/surrender value?
A: Yes, you can. Cash or surrender value doesn't affect deduction eligibility. Any paid premiums qualify.
Q3: If I already claimed this in year-end adjustment, can I claim again on my tax return?
A: No, you cannot claim twice. If you claimed it during year-end adjustment, don't claim again on your tax return. Double claiming is not permitted.
Q4: What if I haven't received my deduction certificate yet?
A: Contact your insurance company to request reissuance. You need it before year-end adjustment deadlines or when filing your tax return. It's an essential document.
Q5: If I pay my parent's or spouse's life insurance premium, can I claim the deduction?
A: Yes, you can. The person who pays receives the deduction. You can claim deductions for spouse or family member premiums you personally paid, as long as they haven't already claimed it.
Q6: Must individual pension insurance be "tax-qualified" to qualify?
A: Exactly — yes, it must be. Non-tax-qualified individual pension insurance does not qualify for this deduction. Check your policy documents or certificate for "tax-qualified" designation.
Q7: If I have medical insurance and cancer insurance, what's my maximum deduction?
A: Maximum ¥40,000 combined. Both medical and cancer insurance fall under the "medical care insurance" category. Combined maximum for this category is ¥40,000.
Q8: Can I claim this deduction if I'm unemployed?
A: Yes, you can. Even if unemployed, if you paid life insurance premiums, they qualify. However, if you have no income, the deduction may not provide tax benefits since you owe no tax.
Q9: Can I file after the tax filing deadline (March 16) and still claim the deduction?
A: Yes, you can still file. Even after the deadline, you can file to claim deductions and potentially receive refunds. Claims can be made within 5 years.
Q10: Can I claim multiple deductions (medical expenses, life insurance, etc.) in one tax filing?
A: Yes, absolutely. You can claim all qualifying deductions in a single tax filing. e-Tax automatically handles multiple deductions simultaneously.
9. Official NTA References
Information in this article is based on official National Tax Agency (NTA) guidance:
Summary
Key takeaways about life insurance premium deductions:
5 Essential Points:
- Up to ¥120,000 Deduction Across 3 Categories — General life, medical care, and pension insurance each allow up to ¥40,000 deduction
- Deductions Based on Premiums Paid — Higher premiums mean larger deductions (maximum ¥40,000 per category)
- Deduction Certificate is Essential — Insurance companies mail this annually Oct-Nov; don't proceed without it
- Claim via Year-End Adjustment or Tax Filing — Either method works; choose what's convenient for you
- The Payer Claims the Deduction — If you pay spouse/family premiums, you get the deduction
2026 Tax Filing Schedule:
- Filing Period: February 16 - March 16, 2026
- e-Tax Available: From January 1, 2026
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