From donations made in 2027, one part of the furusato nozei deduction gets a fixed cap of ¥1.93 million. MIC says you reach it at a salary of about ¥100 million, donating about ¥4.38 million. If you earn ¥10 to ¥30 million, your limit works the same as before.
Key facts (as of October 2026)
- What changes: The resident tax special part of the deduction can’t exceed ¥1.93 million.
- From when: Donations made in 2027 and later.
- Who reaches it: MIC’s estimate is a salary of about ¥100 million, donating about ¥4.38 million.
- What stays the same: The basic part of the deduction. There is also no cap on how much you donate.
Source: MIC, March 24, 2026
What exactly is being capped?
Only one of the three deduction parts is capped. It’s the resident tax special part (tokurei-bun, 特例分). (MIC)
Your furusato nozei deduction has three parts. Each has its own formula. (MIC)
| Part | Formula | Cap today | Cap from 2027 donations |
|---|---|---|---|
| Income tax | (Donation − ¥2,000) × income tax rate | Donations up to 40% of total income | No change |
| Resident tax, basic part | (Donation − ¥2,000) × 10% | Donations up to 30% of total income | No change |
| Resident tax, special part | (Donation − ¥2,000) × (90% − income tax rate) | 20% of your resident tax (income-based part) | Also ¥1.93 million |
So from 2027, the special part stops at whichever is lower. That’s 20% of your income-based resident tax, or ¥1.93 million.
MIC states two points directly. There is no cap on the donation amount. The basic part still applies even above the ¥1.93 million cap. (MIC)
Who is affected by the cap?
Only people whose limit is already very large. MIC estimates this for a model case: single or a dual-income couple, salary only, no housing loan deduction. (MIC)
| Salary | Special part at your limit | Donation limit |
|---|---|---|
| ¥10 million | ¥120,000 | ¥180,000 |
| ¥20 million | ¥320,000 | ¥570,000 |
| ¥50 million | ¥930,000 | ¥2,110,000 |
| ¥100 million | ¥1,930,000 | ¥4,380,000 |
MIC estimates, model case above. The special part only reaches ¥1.93 million at about ¥100 million in salary. Below that, in this model, the 20% rule stops you first. The new cap never comes into play.
Who hits the ¥1.93 million cap?
The special part of the deduction at your limit, by salary. The dashed line is the new cap from 2027 donations.
Cap: ¥1.93 million
MIC estimates for a single person or dual-income couple, salary only, no housing loan deduction. Source: Ministry of Internal Affairs and Communications (MIC), March 2026.
Why aren’t ¥10 to ¥30 million earners affected?
Because your 20% limit is much lower than ¥1.93 million. You can check this with your own resident tax notice.
The special part is capped at 20% of your resident tax income-based part (shotokuwari, 所得割額). (MIC) For the new cap to matter, that 20% must be more than ¥1.93 million.
¥1,930,000 ÷ 20% = ¥9,650,000
So the new cap only matters if your income-based resident tax is over about ¥9.65 million. Find 所得割額 on your resident tax notice and compare.
Here’s an example from our limit guide. Say your income-based part is ¥3,000,000. Then 20% is ¥600,000. That’s far below ¥1.93 million, so only the old 20% rule applies to you. For the full formula, see Furusato Nozei Limit.
The MIC table points the same way. At ¥20 million in salary, the special part is about ¥320,000. At ¥50 million, it’s about ¥930,000. A ¥30 million salary sits between those two rows. (MIC)
Where does the ¥4.38 million figure come from?
It’s the donation where the special part reaches ¥1.93 million, at a 45% income tax rate. You can check it with the MIC formula.
For donations through 2037, MIC uses the income tax rate including the special reconstruction income tax. That’s the rate × 1.021. (MIC) A 45% rate applies to taxable income of ¥40 million and over. (NTA)
- 45% × 1.021 = 45.945%
- 90% − 45.945% = 44.055%
- ¥1,930,000 ÷ 44.055% = about ¥4,381,000
- Add ¥2,000: about ¥4.38 million
This matches the MIC figure. (MIC)
What happens if you donate above the cap?
You still get part of the deduction. The income tax part and the basic part keep growing with your donation. (MIC)
The special part stops at the cap. So each extra yen is only partly deducted. You get back your income tax rate plus the 10% basic part, and pay the rest yourself. This works the same way as going over the 20% limit today.
When does it start to show on your taxes?
The cap applies from donations made in 2027. (MIC) Donations you make in 2026 follow the current rules.
With the one-stop exception, the deduction comes from the next year’s resident tax, from June. (MIC) So for a 2027 donation, it shows from June 2028.
If your salary is over ¥20 million, you must file a tax return anyway. (NTA) You claim the deduction there, not with the one-stop exception.
What if your income isn’t only salary?
MIC’s estimate assumes salary only. (MIC) If you have large income from other sources, your numbers can be different.
In that case, use your resident tax notice and the ¥9.65 million check above. For anything beyond that, ask a tax professional.
What should you do next?
- Find 所得割額 on last year’s resident tax notice.
- If it’s under about ¥9.65 million, the 2027 cap doesn’t affect you.
- Estimate your limit with the formula in Furusato Nozei Limit or Rakuten’s free simulator (in Japanese).
New to furusato nozei? Start with Furusato Nozei Guide.
FAQ
Is there a limit on how much I can donate from 2027?
No. MIC says there is no cap on the donation amount. (MIC) The cap is on one part of the deduction.
I earn ¥25 million. Do I need to change anything?
Based on MIC’s model case, no. Your special part stays below ¥1.93 million. Check that your 所得割額 is under about ¥9.65 million to confirm.
Does the cap apply to my 2026 donations?
No. It applies from donations made in 2027. (MIC)
Does the ¥2,000 out-of-pocket cost change?
The cap doesn’t change the ¥2,000 rule. Below your limit, the amount above ¥2,000 is deducted as before. (MIC)
Does the cap apply to the one-stop exception and the tax return the same way?
The cap is on the resident tax special part. That part exists in both methods. (MIC)
Does my spouse have a separate cap?
Each taxpayer has their own deduction based on their own taxes. See Furusato Nozei Limit.
This article is general information, not tax advice. Figures are MIC estimates for a model case, not your exact numbers. Information is as of October 2026. Sources: MIC: 2026 rule changes (PDF), MIC: Tax deductions, NTA: Income tax rates.