How to Use Furusato Nozei & Calculate Your Limit
A complete guide to the system that lets you receive thank-you gifts for an effective out-of-pocket cost of just ¥2,000
From how the donation works to calculating your limit and choosing between the One-Stop Exception and a tax return, here is the knowledge you need to avoid losing money.
How Furusato Nozei works
An illustrated look at where your tax goes and why you get thank-you gifts for a ¥2,000 cost.
BasicsHow to calculate your limit
Guideline amounts by income and family situation, plus the exact formula for the deduction cap.
ImportantOne-Stop Exception
Complete the process with no tax return. Conditions, how to apply, and deadlines.
EasyApplying via a tax return
Steps for people who file a return for side income, the medical expense deduction, and the like.
FilingThe actual steps
From choosing a site to donating and submitting documents, explained step by step.
StepsCommon mistakes & cautions
Pitfalls such as exceeding your limit, missing deadlines, and One-Stop conditions.
CautionHow Furusato Nozei works
Furusato Nozei (Japan's hometown tax donation) is a system where, by making a "donation" to a local government of your choice, the entire donation minus a ¥2,000 out-of-pocket amount is deducted from your taxes (income tax and residence tax). On top of that, the local government you donate to sends you a thank-you gift.
government of your choice
Choose a local government and gift on a portal site and donate. Credit card payment is fine.
A gift worth up to 30% of the donation (food, daily goods, experiences, etc.) is delivered.
or tax return
Complete the procedure to receive the deduction against next year's taxes (either one is fine).
Part is refunded from income tax, and next year's residence tax is reduced. Your effective cost is only ¥2,000.
How the "effective ¥2,000" works
Freely choose regional specialties from across Japan — rice, meat, seafood, fruit, daily goods, travel vouchers, and more.
The portion above the ¥2,000 out-of-pocket amount is deducted in full from income tax plus residence tax.
Many local governments let you specify how the money is used — hometown, disaster recovery, child-rearing support, and so on.
With the One-Stop Exception, no tax return is needed. You can complete everything on a smartphone.
How to calculate your limit
Furusato Nozei has a deduction cap (limit). If you donate beyond the limit, the excess is not deducted and becomes a pure expense. The limit is determined by your income and family situation.
Guideline amounts by income and family situation (approximate)
| Annual income | Single / dual income (no dependents) |
Married couple (with spousal deduction) |
Couple + 1 child (high-school age or younger) |
Couple + 2 children (high-school age or younger) |
|---|---|---|---|---|
| ¥3 million | approx. ¥28,000 | approx. ¥19,000 | approx. ¥15,000 | approx. ¥7,000 |
| ¥4 million | approx. ¥42,000 | approx. ¥33,000 | approx. ¥29,000 | approx. ¥20,000 |
| ¥5 million | approx. ¥61,000 | approx. ¥49,000 | approx. ¥44,000 | approx. ¥35,000 |
| ¥6 million | approx. ¥77,000 | approx. ¥69,000 | approx. ¥66,000 | approx. ¥60,000 |
| ¥7 million | approx. ¥108,000 | approx. ¥86,000 | approx. ¥83,000 | approx. ¥77,000 |
| ¥8 million | approx. ¥129,000 | approx. ¥120,000 | approx. ¥116,000 | approx. ¥110,000 |
| ¥10 million | approx. ¥176,000 | approx. ¥166,000 | approx. ¥163,000 | approx. ¥157,000 |
| ¥15 million | approx. ¥383,000 | approx. ¥377,000 | approx. ¥373,000 | approx. ¥367,000 |
* These are approximations considering only the social insurance premium deduction and the basic deduction. If you have a medical expense deduction, mortgage loan credit, or the like, your actual limit is lower. Check the exact amount with the simulator on each portal site.
The exact formula for the deduction cap
* Residence-tax income-levy amount = previous year's taxable income × 10% (municipal tax 6% + prefectural resident tax 4%).
* "Income tax rate × 1.021" is the effective rate including the special reconstruction income tax. Because the calculation is complex, using each portal's simulator is the practical choice.
The "amount after employment income deduction" on the left of the withholding slip from your company is the starting point for calculating taxable income.
Subtract the social insurance premium deduction, the ¥580,000 basic deduction, and other deductions.
20% of this amount is the guideline cap for what Furusato Nozei can deduct from your residence tax.
A simplified formula. Confirm the exact value with the simulator on each portal site.
- Claiming the medical expense deduction lowers your taxable income, which also reduces your limit.
- Receiving the mortgage loan credit (a tax credit) subtracts from your residence-tax income levy, lowering your limit.
- During childcare or maternity leave, your salary income falls, so note that the calculation is based on the income of the year before you return.
- If you resign or change jobs mid-year, your income falls, so your limit decreases too.
If your situation changes at year-end, re-run the simulation before making additional donations in November–December.
One-Stop Exception
With the One-Stop Exception system, you can receive the Furusato Nozei deduction without filing a tax return. It is the simplest procedure, aimed at employees who do not need to file.
Steps to apply for the One-Stop Exception
Donate on a portal site (Satofull, Furunavi, etc.). When applying, select "I want the One-Stop Exception application form."
The local government mails you the "Application for the Special Provision on Donation Tax Credits." You can also download it from each local government's site.
Enter your name, address, and My Number. Copy and attach the following identity-verification documents.
One double-sided copy is fine (it covers both the individual number and identity verification).
A copy of your Notification Card plus a copy of ID such as a driver's license is required.
Mail the application form to each local government you donated to (one form per local government).
With no tax return, the full amount is deducted from the residence tax you pay from June of the following year through May of the year after.
A growing number of portals allow online applications via "My Number Portal linkage" or a "local government My Page." Because no mailing is needed, it is easier to make the deadline even if you donate at the end of December.
One-Stop vs. tax return: which is better?
| One-Stop Exception | Tax return | |
|---|---|---|
| Ease of procedure | Just mail the application form | Slightly complex, but fast once you're used to it |
| Cap on donation recipients | Up to 5 local governments | No limit |
| What is deducted | Residence tax only (full amount) | Both income tax and residence tax |
| Timing of the refund | Residence tax reduced from June of the following year | Income tax refunded in March–April; residence tax reduced from June |
| If you have side income or a medical expense deduction | Cannot be used (switches to a tax return) | Can be filed together |
| Difference in amount | None (the deduction is the same) | None (the deduction is the same) |
* If you end up filing a tax return after applying for One-Stop, the One-Stop application becomes void. Be sure to report your Furusato Nozei again on your tax return.
Applying via a tax return
If you file a tax return for side income, the medical expense deduction, the first year of the mortgage loan credit, or the like, report your Furusato Nozei together with it. The One-Stop Exception cannot be used (even if you already applied, it is overwritten by the tax return).
The documents mailed by each local government for each donation. You need them for the tax return, so keep them all. Depending on the portal site, you may be able to download electronic data.
In e-Tax or the Tax Return Preparation Corner, enter the local government name and amount in the "donation deduction" field. Enter the amounts for multiple local governments together.
Submit via e-Tax (online), at the tax office counter, or by mail. With electronic filing you do not need to attach the donation receipt certificates (but must keep them for 5 years).
Unlike One-Stop, the income-tax portion is refunded first. The refund = (donation − ¥2,000) × income tax rate portion.
The actual steps
For those doing Furusato Nozei for the first time, here is the overall flow from applying to completing the deduction.
On a portal site (Satofull, Furunavi, Rakuten Furusato Nozei, etc.), enter your income and family situation in the "deduction simulator" to check your cap. If you have a medical expense deduction or mortgage loan credit, factor those in too.
Choose your preferred gifts and local governments and donate. Payment methods include credit card, convenience-store payment, and PayPay. Gifts usually arrive in 2–3 weeks (they may be delayed during busy seasons).
The Furusato Nozei deduction covers donations from Jan 1 to Dec 31 of that year. If online payment is completed by 23:59 on Dec 31, it counts for that year (the criterion is the payment date, not the delivery date).
Mail the application form plus identity-verification documents so they reach each local government by January 10 of the following year. For year-end last-minute donations, watch the postal collection schedule.
Report it as a "donation deduction" based on your donation receipt certificates. You can claim other deductions together.
Check the "residence tax decision notice" that arrives in June to see whether the deduction is reflected. If there is an amount in the "donation tax credit amount" field, you're set.
Features of the main Furusato Nozei portal sites
Feels the same as using Rakuten Ichiba. It offers Rakuten Points, so Rakuten users lower their effective cost even further.
Strong on the fastest delivery of gifts, some arriving in as little as 3 days. Extensive online support for One-Stop applications.
A wide range of categories, from Amazon gift cards to home appliances. You can earn extra rewards with Furunavi Coins.
Among the largest in Japan for the number of listed local governments and gifts. Focuses on use-of-funds designation and disaster-support donations.
Common mistakes & cautions
Here are common pitfalls with Furusato Nozei. Checking in advance helps you avoid losing money.
The portion above your limit is not deducted and becomes a pure expense. December sees a lot of last-minute donating, so recalculate your remaining limit in November–December before donating more. In particular, check carefully if your income changed mid-year (a job change or a change in bonus).
The application form must arrive by January 10 of the following year. A late-December donation arrives the next year, so mailing may not make the deadline. Send it early, or use a portal that supports online applications. If you miss the deadline, you can handle it with a tax return.
If you need to file a tax return after your One-Stop application (for side income, a medical expense deduction, etc.), the One-Stop application automatically becomes void. There is no problem if you re-enter your Furusato Nozei in the "donation deduction" field of the tax return.
The mortgage loan credit is a tax credit (subtracted directly from tax, not taxable income), so it reduces your residence-tax income levy and lowers your Furusato Nozei cap too. If the mortgage loan credit is large, the tax-saving effect of Furusato Nozei can be limited.
Strictly speaking, Furusato Nozei thank-you gifts can be taxable as an economic benefit. However, temporary income has a ¥500,000 special deduction, so ordinary households are almost never taxed. Caution is needed only when the total value of the gifts is very large.
The One-Stop Exception has a condition of 5 local governments or fewer. Multiple donations to the same local government count as one. If you donate to 6 or more, a tax return is required.
- □ You have simulated your limit based on income and family situation.
- □ If you have a medical expense deduction or mortgage loan credit, you have accounted for its impact.
- □ You have planned so that your donation's payment completes by Dec 31.
- □ You have decided whether to apply via One-Stop or a tax return.
- □ For One-Stop: you plan to mail so it arrives by Jan 10 of the following year.
- □ For a tax return: you are keeping all your donation receipt certificates.
- □ You plan to check the deduction on next June's residence tax decision notice.
Read more in related columns
Complete guide to Furusato Nozei
The deduction breakdown, how the cap is set, and the 2025 ban on points.
Tax returns for employees
Filing when you donate to 6 or more local governments or combine it with the medical expense deduction.
How to calculate the medical expense deduction
The case of filing a tax return together with Furusato Nozei.
FAQ
Is the amount returned different for the One-Stop Exception and a tax return?
The total deduction (with a ¥2,000 out-of-pocket cost) is the same. One-Stop comes from residence tax, while a tax return is split between an income-tax refund and a residence-tax deduction.
Can it be combined with the medical expense deduction?
Yes. However, filing a tax return for the medical expense deduction voids the One-Stop Exception, so you also report the donation on the tax return.
Are points no longer given from 2025?
The granting of points on donations by portal sites was banned from October 2025. Choose based on the content of the thank-you gift.
Sources / official information
This article is based on the official information below. Rules may be revised; please check each official site for the latest details.
- Ministry of Internal Affairs and Communications — Furusato Nozei portal (in Japanese)
- National Tax Agency — Tax Answer No.1155 Furusato Nozei (donation deduction) (in Japanese)
- National Tax Agency — Tax Answer No.1150 When you pay a qualifying donation (donation deduction) (in Japanese)
- Ministry of Internal Affairs and Communications — Furusato Nozei One-Stop Exception system (in Japanese)
* The content of this article is for information purposes and is not tax or legal advice. For individual tax matters, consult your local tax office or a licensed tax accountant (zeirishi).