Revision of Contribution Limits for Defined Contribution Pensions (Effective December 1, 2024)

On September 1, 2021, the Official Gazette published the "Cabinet Order for Partial Revision of the Cabinet Order for Enforcement of the Defined Contribution Pension Act and Transitional Measures Accompanying the Enforcement of the Act for Partial Revision of the Employees' Pension Insurance Act, etc. for Ensuring the Soundness and Reliability of the Public Pension System (Cabinet Order No. 244 of 2021)." With this revised Cabinet Order, the contribution limits for defined contribution pensions will be revised, effective December 1, 2024.

✅ Overview

1. Revision of contribution limits for Corporate-type DC

Currently, for Corporate-type Defined Contribution Pensions (hereinafter "Corporate-type DC"), if a participant is enrolled in another system (referring to Defined Benefit Corporate Pensions (hereinafter "DB"), the Mutual Aid Association for Private School Personnel, and the Coal Mining Pension Fund; the same applies hereinafter), the monthly contribution limit is uniformly reduced to 27,500 yen regardless of the actual amount of contributions to the other system (or 55,000 yen if not enrolled in another system).
Regarding this, it has been decided to set the contribution limit as follows, based on the actual amount equivalent to contributions to other systems in which each Corporate-type DC participant is enrolled.

→ The contribution limit shall be 55,000 yen per month minus the amount equivalent to contributions to other systems.

2. Revision of contribution limits for Individual-type DC

Currently, for Individual-type Defined Contribution Pensions (hereinafter "Individual-type DC"), if a participant is enrolled in another system or a mutual aid association (referring to the National Public Service Personnel Mutual Aid Association and the Local Public Service Personnel Mutual Aid Association; the same applies hereinafter), the monthly contribution limit is uniformly reduced regardless of the actual amount of contributions to the other system or mutual aid association. It has been decided to revise this in the same manner as the revision of the Corporate-type DC contribution limits in 1. above.

Additionally, while there is currently a difference in the upper limit of the Individual-type DC contribution limit of 20,000 yen or 12,000 yen per month depending on the other system or mutual aid association in which the participant is enrolled, it has been decided to unify this to 20,000 yen.

✅ Diagrams including the post-revision status following the "previously finalized revision effective October 1, 2022" and "this revision effective December 1, 2024"