The National Tax Agency has published “How to Conduct Year-End Tax Adjustments for Reiwa 8” (64 pages in total). The main points listed under “Changes Compared to Last Year” are as follows.

◆ Changes Compared to Last Year

 (1) Increase in the Basic Deduction

The basic deduction has been raised to between 620,000 yen and 1,040,000 yen, depending on total income (previously 580,000 yen to 950,000 yen).

 (2) Increase in the Minimum Guaranteed Amount for the Salary Income Deduction

740,000 yen (650,000 yen prior to the amendment)

In conjunction with the above increases, the “Table of Salary Amounts After Salary Income Deductions for Year-End Adjustments, etc.” specified in the Income Tax Act for Reiwa 8 and subsequent years has been revised

 (3) Revision of Income Requirements for Dependents, etc., Accompanying the Increase in the Basic Deduction

・Dependent relatives, spouses living in the same household, and children living with a single parent (*)… 620,000 yen or less (previously 580,000 yen or less)

・Specified relatives… Over 620,000 yen and up to 1,230,000 yen (previously: over 580,000 yen and up to 1,230,000 yen)

・Spouses eligible for the Special Spousal Deduction… Over 620,000 yen and up to 1,330,000 yen (previously: over 580,000 yen and up to 1,330,000 yen)

・Working students…890,000 yen or less (previously 850,000 yen or less)

*For children living with a single parent, the total amount of gross income, etc., is used rather than total taxable income

 (4) Special Provision for Life Insurance Premium Deductions When Supporting Dependents Under 23 Years of Age

Deduction limit for the general life insurance premium deduction for new life insurance policies… 60,000 yen (40,000 yen prior to the amendment)

The above provisions will take effect on December 1, Reiwa 8, and must be implemented for withholding tax procedures starting in December Reiwa 8, including year-end tax adjustments for the Reiwa 8 tax year. In particular, the revisions to the income requirements for dependents and other relatives may result in relatives who were previously ineligible for deductions such as the dependent deduction becoming eligible.

Please make an effort to prepare early, utilizing the relevant materials published by the National Tax Agency (such as examples of how to fill out various tax return forms, sample notification letters, and Q&A sections).

[Reference]

How to Conduct Year-End Adjustments for Reiwa 8 (National Tax Agency)
https://www.nta.go.jp/publication/pamph/gensen/nencho2026/01.htm