On May 16, 2025, Japan’s Ministry of Health, Labour and Welfare (MHLW) issued a significant revision regarding the refund of Nenkin (the national pension insurance) for foreigners living and working in Japan. These are the most substantial changes in recent years concerning Nenkin refund policies, directly impacting the rights of many foreign workers currently employed in Japan. In the article below, HSB JAPAN will help you understand the new updates, key points to be aware of, and how to best prepare to ensure your rights are protected.
Nenkin (年金) is Japan’s national pension insurance system, managed by the Japanese government to provide income security for individuals after retirement. By law, all legal residents in Japan—including foreigners—who work and contribute to social insurance are required to participate in the Nenkin system.
However, not everyone stays in Japan long enough to receive monthly pension payments after retirement. Therefore, the Nenkin refund system was created to allow foreigners who permanently leave Japan to claim back a portion of the pension contributions they paid.
According to the Ministry of Health, Labour and Welfare, the Nenkin refund is a right granted to foreigners who have contributed to the system for a certain period. It enables them to reclaim part of the accumulated pension contributions from their time working in Japan.
(Source: MHLW – Japan Pension Service)
One of the most notable updates in the new Nenkin regulation is the rule concerning the Re-entry Permit. Previously, foreign workers could return to their home country temporarily and still submit a one-time Nenkin refund application, regardless of whether they held a valid re-entry permit. However, under the new regulation, this condition has changed significantly.
Specifically, foreign workers who leave Japan while holding a valid re-entry permit will not be eligible to receive the one-time Nenkin refund until the permit expires. In other words, you must leave Japan permanently, without holding any valid document that allows you to return, in order to qualify for the refund.
This change directly affects individuals planning to temporarily return to their home country to apply for the Nenkin refund, and then come back to Japan under a new visa or program. Under the new rule, such cases will not be eligible for Nenkin processing until the re-entry permit expires completely—which can take several months to a year, causing delays and complications.
Notably, if a worker is unaware of this change and applies too early, their application may be rejected or subject to additional explanation requests by the authorities—resulting in wasted time and potential disruption to their post-departure financial plans.
In addition to changes in residency conditions, another key update in the new Nenkin regulation is the extension of the maximum contribution period eligible for refund—from 5 years (60 months) to 8 years (96 months). This change is beneficial for long-term foreign workers in Japan.
Currently, even if a foreign worker contributes to Nenkin for more than 5 years, the refund amount is calculated based on a maximum of 60 months. Contributions beyond that limit are not refunded, which has disadvantaged many workers—especially those who have worked in Japan for 6 to 10 years but are ineligible for monthly pension payments.
Under the new regulation, the calculation cap will be increased to 96 months, meaning workers who contributed Nenkin for 6–8 years will now be refunded based on their actual contribution period, resulting in significantly higher payouts.
According to the Japan Pension Service’s calculation method, the refund amount depends on both the duration of contributions and the insured income level. With the limit extended to 96 months, the refund amount could increase by hundreds of thousands of yen—a substantial amount for many foreign workers.
For example, someone who contributed Nenkin for 60 months might currently receive approximately ¥600,000–¥800,000, whereas under the new rule, a worker with 96 months of contributions might receive up to ¥1,000,000–¥1,300,000, depending on their average salary and the calculation formula used.
“The extension of the maximum refund period from 5 years to 8 years will apply to foreign nationals enrolled in the pension system from the date the new law takes effect, aiming to enhance the rights of long-term workers.”
(Source: Ministry of Health, Labour and Welfare, 2025)
Although the revised draft has been officially released, the exact date for enforcement of the new regulations has not yet been finalized. According to an announcement from Japan’s Ministry of Health, Labour and Welfare, the changes will come into effect within a maximum of four years from the date the law is officially enacted.
The official document issued by the Ministry also notes:
“These changes will be stipulated by a government ordinance and will take effect on the date specified in that ordinance, within four years from the date the law is announced.”
It is expected that the new regulations will be enacted within four years from May 16, 2025.
This means that foreign workers will still have some time to prepare and adjust their residency plans, but should not delay for too long, as the changes could come into effect at any time within that period.
If you have contributed to Nenkin for 60 months (5 years) or more, now is a good time to start considering the refund process as soon as possible. With the new regulations expected to take effect within the next four years, taking early action can help you:
Avoid the risk of being disqualified from receiving a refund due to an active Re-entry Permit.
Optimize the processing time of your application, especially if you’re planning to leave Japan soon or do not intend to return long-term.
Stay unaffected by unpredictable changes in the law, allowing you to take better control of your financial and residency plans.
The revision of the Nenkin refund law, announced by Japan’s Ministry of Health, Labour and Welfare on May 16, 2025, marks a significant step in protecting the rights of foreign workers in Japan. These changes not only aim to create a fairer refund system, but also encourage long-term contributions and engagement from the foreign workforce.
To stay informed and up to date on these policy changes, you can visit the official websites below:
Stay proactive and informed to protect your benefits.
Thank you for taking the time to read this article. If you found the content helpful, please don’t forget to share it with your family and friends so they can also stay informed about the latest updates on Nenkin refund rights.
If you need specific advice on the Nenkin refund procedure or related services, don’t hesitate to contact HSB JAPAN for quick and professional support.
Email: tax_pension@hsbjapan.com
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