Meal benefit in Japan

Dear all,

I would appreciate it if someone could assist me with the issues below:

1. How the "earned Income deduction" is calculated in Japan?
2. How the "basic and dependent deduction" is calculated in Japan?
3. If the employer grants its employee with a meal benefit (as voucher meal for example) on the amount of 3500 YEN (in addition to the basic salary), how this this extra wage should be calculated? How does this extra wage influence the social insurance cost for the company/employer?
4. If the employee's meal benefit contribution is 3500 YEN, how does it affect the employee's salary? (considering the tax exemption related to meal benefit in Japan). Does the employee have to pay consumption tax (8%) on the above amount?

Thanks in advance for your kind assistance.

Best regards,
Johann

Are you trying to find out so that you can do your own tax filing, or are you just trying to figure out how much money you will receive after your employer does all those deductions and calculations for you?

1. I think this term includes all different types of deduction, including medical expenses, social insurance, insurance, donations, etc., etc.

2. Basic deduction is 380,000 yen. Deduction for spouse with annual income of 380,000 or less (or annual salary of 1,030,000 yen) is 380,000 yen. Deduction for dependents range 380,000 - 580,000 yen, depending on the age/specific circumstances of the dependents.

3. 4. I assume this will be considered a type of allowance, and is probably added to the base salary for the purpose of calculation of income taxes. No consumption taxes.

why don't you ask the employer ?
since the employer will take care your tax return (you don't file tax return by yourself), you don't need to worry about those minor points.

the answer against No.3 and 4 is that you don't need to add "the 3500 yen" per month to your income, when you file tax return.
in the company's calculation, 3500 yen is not classified as the money paid to employees(人件費), but is classified as welfare expense, 福利厚生費.

Thanks for your answers.

I would like to focus on the employee's contibution meal benefit.

In order to be tax exempted on the meal benefit, the Japanese regulations state that the employer and the employee have to contribute with the same amount, up to the cap of 3500 YEN (for each of one).

Therefore, the employee's contribution has to be deducted from his brut salary (Let's assume that the amount is deducted to a prepaid card with which the employee pays at restaurants).

Now, the question is how the mandatory deductions are deducted from the employee's salary? Meaning, how the social insurance cost of the employee is calculated?

Let's assume that the employee's gross salary is 350,000 YEN.

Are the social insurance costs calculated fron 350K YEN or from 346.5K (350K-3.5K)?

Another issue - Does the employee pays consumption tax on the contrinution amount? Meaning, does he have to add 8% ?

Thanks and regards,
Johann