The 2026 income walls: at healthcare hourly rates, the ¥1.3 million wall comes first

“Apparently the ¥1.03 million wall is now ¥1.78 million.” If you’ve heard that and are wondering whether to pick up more shifts, you’re not alone. But for part-time healthcare jobs, where hourly pay is high, you’ll often hit a different wall well before ¥1.78 million.

There isn’t just one of these income walls (年収の壁). There are walls for income tax, for resident tax (住民税) and for social insurance (health insurance and employees’ pension), and each counts “income” in its own way. This article sets out the rules as of September 2026 and applies them to typical part-time hourly pay in healthcare.

The five main walls in 2026

The tax walls: ¥1.78 million and ¥1.36 million

No income tax up to ¥1.78 million

For people whose only income is salary, the most you can earn without paying income tax was ¥1.03 million up to tax year 2024. It became ¥1.6 million for 2025 and ¥1.78 million for 2026 and 2027. The ¥1.78 million figure comes from the FY2026 tax reform (令和8年度改正), which takes effect on December 1, 2026. Monthly withholding through November 2026 does not change; the difference is applied all at once in the year-end tax adjustment (年末調整) in December.

From tax year 2028, a system will be introduced to review the threshold every two years in line with prices. What the threshold will be for 2028 onward has not yet been decided.

Source: NTA, 源泉所得税の改正のあらまし (Overview of Withholding Income Tax Revisions, April 2026); NTA, 令和8年度税制改正（所得税の基礎控除の引上げ等関係）Q&A (FY2026 Tax Reform Q&A: raising the income tax basic deduction, etc., May 2026)

Tax dependent status: ¥1.36 million

The income limit for your husband, wife or parent to claim the spouse deduction or dependent deduction for you has risen from ¥1.03 million to ¥1.23 million (tax year 2025) and then to ¥1.36 million (from tax year 2026). For a spouse, going over ¥1.36 million switches the claim to the special spouse deduction (配偶者控除・配偶者特別控除), and the deduction stays at the full amount (¥380,000) up to ¥1.69 million. Above that it tapers off in steps (where the husband’s or wife’s own income is ¥9 million or less).

Source: NTA Tax Answer No.1191 and No.1195; NTA, 源泉所得税の改正のあらまし (Overview of Withholding Income Tax Revisions, April 2026)

Resident tax starts lower

The basic deduction for resident tax is still ¥430,000; it hasn’t changed. So resident tax kicks in at a much lower income than income tax. For FY2026 resident tax (based on 2025 income), a single person with salary income of ¥1.1 million or less pays no income-based portion (所得割), and the upper limit for paying no per-capita portion (均等割) is about ¥1.03–1.1 million, depending on the municipality you live in. More and more people find they pay no income tax but do pay resident tax.

Source: Resident tax guidance from Musashino City, Asago City, Yoshinogari Town and others (2026). The editors have not been able to confirm the tax-exempt range for FY2027 resident tax

The social insurance walls: ¥1.3 million and 20 hours a week

The ¥1.3 million wall (family dependent status) stays

You can remain a dependent on health insurance and a Category 3 insured person under the National Pension only if your annual income is under ¥1.3 million (under ¥1.8 million for people aged 60 or over and some others; under ¥1.5 million for ages 19 to 22 from October 2025). Unlike the tax walls, this ¥1.3 million figure has not changed.

From April 2026, the way it’s judged has changed. If your expected annual income based on your contract, such as your written notice of working conditions (労働条件通知書), is under ¥1.3 million, you can in principle be a dependent. Even if occasional overtime not in your contract pushes you over, your dependent status does not have to be withdrawn as long as it’s within a range that is reasonable by common social standards (no amount has been given for what counts as reasonable).

Source: Japan Pension Service, 労働契約内容による年間収入での被扶養者の認定の取り扱い (Recognizing dependents based on annual income under the employment contract, 2026)

The “¥1.06 million” wall is planned to go in October 2026

At present, at companies with 51 or more employees and similar, you join your employer’s social insurance yourself if you meet all the conditions, including “20 or more hours a week” and “¥88,000 or more a month (the so-called ¥1.06 million wall)”. The ¥88,000-a-month requirement is planned to be abolished in October 2026 (per Japan Pension Service guidance). After that, 20 hours a week becomes the benchmark, whatever your hourly pay.

The company-size requirement is also planned to widen in stages: to 36 or more employees in October 2027, 21 or more in October 2029 and 11 or more in October 2032, before being removed entirely in October 2035.

Source: Japan Pension Service, 短時間労働者に対する健康保険・厚生年金保険の適用の拡大 (Expanding health insurance and employees’ pension coverage to short-time workers); Ministry of Health, Labour and Welfare (MHLW), 年金制度改正法の概要 (Overview of the Pension System Reform Act, 2025)

At healthcare hourly rates, which wall comes first?

In the MHLW Basic Survey on Wage Structure (2025), the average hourly pay for part-time (short-time) workers was ¥1,933 for Registered Nurses (看護師) and ¥1,624 for Licensed Practical Nurses (准看護師). Using these rates, here are the hours it takes to reach each wall.

At the average RN hourly rate, you reach ¥1.3 million at around 13 hours a week. That’s still well short of 20 hours a week, so even at a hospital with 51 or more employees you would lose dependent status on your family’s insurance without yet joining your employer’s social insurance. That leaves a “gap” where you pay National Pension and National Health Insurance yourself. By the numbers, anyone earning more than about ¥1,250 an hour is likely to fall into this gap (¥1.3 million ÷ (20 hours a week × 52 weeks) ≈ ¥1,250).

If you add shifts thinking “I’m fine up to ¥1.78 million”, you can end up going over ¥1.3 million first. For part-time healthcare workers, this is the point to watch most closely.

If you work night shifts or get a commuting allowance

• Night shift allowance and late-night premium pay count toward income for tax and toward expected annual income for the ¥1.3 million test. With 16-hour night shifts, four a month comes to 64 hours. At ¥1,800 an hour, that’s ¥1.38 million a year even without the night shift allowance, so by this estimate four night shifts alone take you over ¥1.3 million.
• Commuting allowance is left out of the tax calculation as long as it’s within the tax-exempt limit. For the ¥1.3 million test, on the other hand, the basic approach is to look at expected annual income including allowances. For example, with a commuting allowance of ¥10,000 a month, you would need to keep your hourly earnings under ¥1.18 million a year. Check how it’s treated with the health insurance plan your family member belongs to.

We cover how each allowance is treated in more detail in our article on night shift allowance, tax and social insurance.

How to decide

There’s no right answer to whether you work within dependent status or join social insurance. Joining social insurance lowers your take-home pay, but it raises your future employees’ pension and gives you access to benefits such as sickness and injury allowance when you’re off ill or injured. When you think it through, we suggest this order:

1. Check whether your family member’s employer has income conditions on its spouse or family allowance (the walls aren’t only the national ones).
2. Check your own employer’s number of employees and your contracted weekly working hours.
3. From your hourly pay and allowances, work out the hours at which you reach ¥1.3 million.