Social Security Agreement with Japan Frequently Asked Questions

Note: The following information is provided as a guide only. People should contact Centrelink International Services on 131 673 for specific information relating to their circumstances.

When did the Agreement start?

The Agreement started on 1 January 2009.

What does the Agreement do?

Under the Agreement, Australia and Japan share the responsibility for paying pensions to people who would not otherwise be entitled because they do not have enough residence in Australia or sufficient periods of coverage in Japan. It also helps people who could not otherwise claim because they are living abroad.

 

The Agreement also reduces costs for businesses operating in both countries through provisions regulating compulsory contributions in respect of seconded workers.

 

What payments are covered by the Agreement?

The Agreement covers Australian and Japanese age pensions.

What are the main features of the Agreement?

Australian legislation requires a person to have a minimum of 10 years Australian residence before they can claim an age pension. It also requires the person to be an Australian resident and in Australia on the day the claim for pension is lodged.

The Agreement allows people to use Japanese periods of coverage to make up the 10 years Australian residence required to qualify for Age Pension.

The Agreement also allows a person to claim an Australian pension while residing in Japan or a third country with which Australia has an Agreement that allows for claim lodgement.

Note: To use the Agreement to claim an Australian pension while residing outside of Australia, a person must have actually resided in Australia during their working life (Australian working life residence is residence in Australia between age 16 years and Age Pension age) for a minimum of 12 months.

Centrelink has information on residence requirements for payments covered by the Agreement.

Japanese legislation normally requires a person to have at least 25 years of qualifying periods of contributions to be eligible for an old-age pension.

The Agreement allows people to use employment related periods of Australian working life residence in order to meet the minimum periods of contributions required to qualify for a Japanese pension.

Japan also guarantees to pay its old-age pension into Australia indefinitely.

Australian residents will continue to be able to apply for refunds of their contributions (up to the existing limit of three years contributions) when they leave Japan, after the Agreement commences. However people who receive a refund will not be able to receive a Japanese pension in respect of those contributions and will not be able to use those periods to help them qualify for an Australian pension.

How do seconded workers benefit under the Agreement?

The Coverage Provisions mean that contributions do not have to be made into both countries' systems for an employee seconded to work temporarily in the other country. The Australian Taxation Office (ATO) is responsible for the administration of the coverage provisions. Contact the ATO if you require more information on this aspect of the Agreement.

Where and how can people lodge claims for social security pensions?

In Australia

People living in Australia can lodge claims for Australian and Japanese pension with any Centrelink Customer Service Centre.

In Japan

People living in Japan can lodge claims for Japanese and Australian pension at their local Japanese social insurance institution.

When does payment start?

In Australia's case, payment starts from the date the claim is lodged, or if the claim is lodged early, the date the person qualifies for payment. Age Pension claims can be lodged up to three months in advance of qualification.

How are pensions and benefits paid?

If you get an Australian pension in Australia, Services Australia will pay it directly into your bank account every 2 weeks.

If you get an Australian pension in Japan, Services Australia will pay it directly into your nominated Japanese bank account every 4 weeks in Japanese Yen.

If you get a pension from Japan it can be paid to you in Australia.

Some people might get pensions from both countries so they will get two separate payments - one from Australia and one from Japan.

Who handles claims and questions?

Claims and questions relating to the Agreement are handled:

  • for Australia, by contacting Centrelink International Services on 13 1673
  • Australian pensioners residing in Japan can contact Centrelink International Services on +61 3 6222 3455 (call charges apply)
  • for Japan, by contacting the:
    Social Insurance Operations Center
    3-5-24 Takaidonishi
    Suginami-ku
    Tokyo 168-8505
    JAPAN
    Phone: + 81 3 5344 1100
    Fax: + 81 3 3335 6304

What documents do I need to make a claim?

Australian Pensions

When you claim an Australian pension you need to complete a claim form and provide documents to prove your identity and periods of residence in Australia.

 

 

Proof of Identity

Some of the acceptable documents to prove your identity are:

 

  • birth certificate or extract;
  • current Australian passport;
  • certificate of Australian citizenship.

Helpful documents that can assist you to do this include:

  • Australian or overseas passport that shows your date of arrival in Australia;
  • Entry visa;
  • Australian citizenship papers;
  • Employment and/or tax records, including group certificates issued by Australian employers.

Note: This is only some of the documents that can be used to prove your identity and your Australian residence. Centrelink is able to provide more information on other acceptable documents to prove your identity and Australian residence.

If you are claiming an Australian pension while you are living in Japan, you will still have to provide proof of identity and proof of previous Australian residence to the Japanese authorities.

Japanese Benefits

The Japanese authorities can advise you of the documentation you need to provide.

What are the most important things to know about the Australian social security system?

All claimants for Australian pensions need to meet all qualifications (e.g. age and residence) required for that pension under Australia's social security laws. Australian pensions are also means tested, that is, an assets and an income test is applied, and whichever produces the lower rate is used for assessment. The Services Australia website has information about the current income and assets test limits.

How much pension will I get if I am paid under the Agreement?

Australian pension for a person not living in Australia

 

The rate of Australian pension payable outside of Australia is affected by two things:

 

  • the length of Australian working life residence; and
  • the amount of income and assets in excess of specified limits.

Australian pensions paid overseas are paid at a proportional rate reflecting the length of Australian working life residence.For claims made since 1 July 2014, a person with 35 years Australian working life residence (between age 16 and Age Pension age) could be paid a full age pension (subject to the means test). With less than 35 years, the rate is worked out on a proportional basis. For example, a person with 20 years Australian working life residence would receive 20/35ths (or 57%) of the means-tested rate of Australian pension.

The income and assets tests also apply, so that a person with 35 years Australian working life residence could still receive a part pension if their income or assets exceed allowable limits.

Australian pension for a person living in Australia

When a person is granted a pension in Australia under the Agreement (because the person does not meet the minimum residence requirements), the person receives the normal means tested pension less the amount of any Japanese pension they also receive. The Japanese pension is 'topped up' to the rate of Australian pension the person would get if all they received were an Australian pension.

Once a person qualifies for an Australian pension in his or her own right (without needing the Agreement) any Japanese benefit is treated as income in the normal way.

Can I get a lump-sum refund of my Japanese contributions?

Australian residents, who are not Japanese nationals, will still be able to apply for refunds of their Japanese contributions (up to the existing limit of three years contributions) when they leave Japan. These applications for refunds must be made within 2 years of leaving Japan. However people who receive a refund will not be able to receive a Japanese pension in respect of these contributions and will not be able to use those periods to help them qualify for an Australian pension.

Examples

Example 1:

A person who lived in Australia for 20 years during working life (between age 16 and Age Pension age) is now living in Japan and is already receiving a Japanese old-age pension. This person left Australia before reaching Age Pension age.

Entitlement

 

  • Without the Agreement
    Although this person has more than the 10 years Australian residence required to qualify for Australian Age Pension, they do not qualify for payment because the person is not an Australian resident and physically present in Australia.
  • With the Agreement
    This person can now claim an Australian benefit without the need to return to Australia to live permanently. The Australian pension rate will be proportionalised based on their Australian working life residence, that is, the person will receive 20/35ths of the means tested rate.

Example 2:

A woman aged 65 living in Japan has also lived in Australia for 9 years during her working life (between age 16 years and Age Pension age). She has completed a period of 20 years of contributions in Japan.

Entitlement

 

  • Without the Agreement
    She does not qualify for Australian pension because she is not living in Australia and nor does she have the minimum 10 years of Australian residence required to qualify for an Australian Age Pension. Also, she would not qualify for Japanese old-age pension as she has not completed the minimum period of contributions required (currently 25 years) to qualify for payment.
  • With the Agreement
    She can claim and qualify for an Australian Age Pension in Japan because her 9 years Australian residence plus the periods of contributions in Japan add up to more than the 10 years required for an Australian pension. Her rate of payment would be 9/35ths of the means-tested rate, payable if she was in Australia.
    She may also qualify for a Japanese old- pension because she can add her 9 years of Australian working life residence (if she was employed in Australia at that time) to the 20 years of contributions in Japan to meet the minimum period of contributions (25 years) that is required to qualify for payment.

Example 3:

A 65 year old man in Japan has the minimum period of contributions in Japan to qualify for old-age pension. He has lived in Australia for 9 months during his working life.

Entitlement

 

  • Without the Agreement
    This person is entitled to Japanese pension only. No Australian pension can be paid.
  • With the Agreement
    This person will continue to receive Japanese pension. However, he is still not entitled to Australian pension because he only has 9 months Australian residence (12 months minimum required).

Example 4:

A person is aged 65 and has lived in Australia for 6 years. Before moving to Australia he lived in Japan and completed a period of contributions in the Japanese system for 35 years. He now wishes to claim an Australian pension.

Entitlement

 

  • Without the Agreement
    He could not get an Australian Age Pension because he has not lived in Australia for more than 10 years.
  • With the Agreement
    The person can add his 6 years as an Australian resident to the 35 years periods of contributions completed in Japan so that he meets the minimum 10 years Australian residence required to qualify for an Australian Age Pension.

Also, Centrelink can assist him in claiming Japanese old-age pension.

How do I find out more?

For more information on claim procedures and payments:

For policy information, contact the Department of Social Services (complaints@dss.gov.au).

For more information on how the Agreement will assist seconded workers, contact the Australian Taxation Office.

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