Japan to Simplify Source Withholding Report Filing

Japan will introduce a new filing simplification rule from January 1, 2027.

This change affects:

• employers issuing salary withholding slips, and

• pension payment reporting.

What will change?

Currently, employers often need to submit:

1. a withholding slip to the tax office, and

2. a salary payment report to the local municipality.

Under the new rule:

👉 If the required information is included in the salary payment report submitted to the municipality,　the withholding slip will be treated as already submitted to the tax office.

In many cases, separate submission to the tax office will no longer be necessary.

Why these matters

This reform aims to:

• reduce duplicate paperwork,

• simplify payroll administration,

• and improve efficiency.

For foreign business owners

Japanese payroll reporting can be complicated for foreign employers.

This change may help by:

• reducing filing work,

• simplifying reporting procedures,

• and lowering administrative burden.

However, companies must still:

• prepare payroll information correctly,

• and submit reports on time.

Key takeaway

From January 2027, Japan plans to simplify payroll tax reporting by reducing duplicate submissions between municipalities and tax offices.