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Returning Retirement Lump-Sum

If a person who received a Retirement Lump-sum in the past acquires the eligibility to receive Old-age Employees' Pension or Disability Employees' Pension payment, or if a person who received a Retirement Lump-sum in the past dies and his/her survivors acquire the eligibility to receive Survivors' Employees' Pension payment, the Retirement Lump-sum received in the past plus an interest must be returned with the following procedures:

Note: Definition of Retirement Lump-sum
Retirement Lump-sum was applied when a person with participation periods of 1 to 19 years retired on or before December 31, 1979. It was paid after deducting the funds necessary to receive an aggregate amount of Retirement Pension (frozen amount).

There was an option for such a person eligible to receive the Lump-sum to receive it in entirety without deducting the frozen amount.

Handling of the period during which a Retirement Lump-sum after deducting the frozen amount was received

The period on which the received Retirement Lump-sum was based will be treated as the period for calculating Old-age/Disability/Survivors' Employees' Pension benefits, and the Lump-sum must be returned.

Handling of the period during which an entire Retirement Lump-sum was received

  1. When the total of all participation periods is 20 years or longer:
    The basic calculation period for the Retirement Lump-sum is treated as the calculation period for Old-age Employees' Pension, etc., and the Lump-sum must be returned.
  2. When the total of all participation periods is less than 20 years:
    The basic calculation period for the Retirement Lump-sum is not treated as the calculation period for Old-age Employees' Pension, etc., and the Lump-sum shall not be returned.

Method for returning Retirement Lump-sum

When a person must return a Retirement Lump-sum, the return amount is the Retirement Lump-sum plus interest, which varies depending on the period from the time when the Lump-sum payment was received to the time when the right to receive pension benefits was acquired.

[Note] The interest is calculated, at compound rate, according to the period between the month following the payment date of the Retirement Lump-sum and the month when the eligibility to receive pension benefits came into effect. Interest rates corresponding to individual periods for calculating the interest amount are shown below:

Table of interest rates

Period Interest rate
March 2001 5.5%
April 2001 - March 2005 4.0%
April 2005 - March 2006 1.6%
April 2006 - March 2007 2.3%
April 2007 - March 2008 2.6%
April 2008 - March 2009 3.0%
April 2009 - March 2010 3.2%
April 2010 - March 2011 1.8%
April 2011 - March 2012 1.9%
April 2012 - March 2013 2.0%
April 2013 - March 2014 2.2%
April 2014 - March 2015 2.6%
April 2015 - March 2016 1.7%
April 2016 - March 2017 2.0%
April 2017 - March 2018 2.4%
April 2018 - March 2019 2.8%
April 2019 - March 2020 3.1%
April 2020 - : depending on the next financial recalculation

There are two methods to return the Retirement Lump-sum. One of the return methods should be selected when pension payment is requested.

  1. Deduct 1/2 of a pension payment amount every pension payment term.
  2. Pay in cash in full or in a one-year-installment plan.