Baseline scenario
Same-year receipt of severance pay and iDeCo lump sum is the baseline. Other scenarios are compared against it.
Free tool
Severance and iDeCo optimizer
The order and method used to receive severance pay and iDeCo can change after-tax proceeds materially. Compare seven common scenarios, including the 5-year rule, 19-year rule, and annuity options.
Enter assumptions
10k yen
years
10k yen
years
10k yen/year
age
Results
Calculating...
Comparing retirement allowance and iDeCo payout patterns.
How to read the result
5-year / 19-year rules
Separate-year scenarios apply overlap adjustments to the retirement income deduction when the rule is triggered.
Annuity effect
Receiving iDeCo as an annuity can avoid lump-sum deduction conflicts while using public pension deduction capacity.
The seven scenarios compared
1. Same-year lump sums
Receive severance pay and iDeCo lump sum in the same year.
2. iDeCo first, 5 years before
Receive iDeCo at least five years before severance pay.
3. iDeCo first, 4 years before
Apply the 5-year overlap rule to the severance-side deduction.
4. Severance first, iDeCo 20 years later
A long-gap scenario that avoids the 19-year overlap rule.
5. Severance first, iDeCo next year
Apply the 19-year overlap rule to the iDeCo-side deduction.
6. iDeCo as a 10-year annuity
Receive severance as a lump sum and iDeCo as annuity income.
7. iDeCo 50% lump sum + 50% annuity
A mixed scenario that splits iDeCo between lump sum and annuity.
FAQ
What does this tool compare?
It compares common severance and iDeCo receipt patterns, including same-year lump sums, iDeCo-first timing, severance-first timing, annuity receipt, and mixed lump-sum plus annuity receipt.
What are the 5-year and 19-year rules?
Under Japanese retirement income tax guidance, deduction overlap can reduce the available retirement income deduction when severance pay and iDeCo lump sums are received close together.
What does the baseline comparison mean?
It shows the difference from receiving severance pay and iDeCo as same-year lump sums, which is treated as the baseline.
Why are some scenarios excluded by age constraints?
iDeCo lump sums can generally be received only from age 60 to 75, so scenarios outside that range are removed.
Which tax rules are included?
The tool includes retirement income deduction, half taxation for retirement income, public pension deductions, marginal taxation of iDeCo annuity income, and overlap adjustments. Social insurance and spouse benefits are not included.