【2026 Edition】Is Tax Filing Required for Wages from Type B Continuous Employment Support? How to Determine Based on the 650,000 Yen Threshold

This article is updated based on the tax system as of 2026.

In the Employment Continuation Support Type B, when individuals with disabilities engage in work and generate income, they receive money as "wages."

However, a common question arises: "Is the money received as wages subject to tax filing?"

Wages received from Employment Continuation Support Type B do not require tax filing if they are less than 650,000 yen annually.

Most Type B users are not subject to this requirement.

However, there are cases where tax filing is necessary or beneficial, such as having additional side income or wanting to claim medical expense deductions. Misjudging this can lead to unnecessary filings or missing out on refunds.

This article, organized by the General Incorporated Association Ayumi, which is well-versed in welfare services, is aimed at individuals using Employment Continuation Support Type B and their families. It covers ① three cases where tax filing is necessary, ② cases where it is not, ③ the impact of the 2026 tax reform (whether there is a tax obligation), and ④ how to choose a consultation source and how to handle it.

1. What is Employment Continuation Support Type B?

Employment Continuation Support Type B is a welfare service available for individuals who find it challenging to maintain employment contracts due to the degree of their disabilities or age.

Besides Type B, there is also Type A, with the main difference being whether a employment contract is signed.

In Employment Continuation Support Type B, individuals can work without signing an employment contract, allowing them to work at their own pace and receive "wages" as compensation for their work.

Additionally, Type B is characterized by the absence of age restrictions for service use.

On the other hand, Employment Continuation Support Type A is a welfare service that allows individuals who find it difficult to work in general companies due to disabilities to work while receiving support under an employment contract.

Employment Continuation Support Type A is targeted at those under 65 years old (at the start of use) who can work continuously, unlike Type B.

2.Understand Before Tax Filing! What is the Difference Between Wages and Salary?

In Employment Continuation Support Type B, various tasks are available depending on the facility, and "wages" are paid as compensation for these tasks.

On the other hand, the compensation paid in Employment Continuation Support Type A is referred to as "salary" or "wages."

The difference between "wages" and "salary" is whether the work is based on an employment contract.

In Employment Continuation Support Type A, it is necessary to sign an employment contract with the user, and since they are considered workers under the Labor Standards Act, the facility is obligated to pay wages.

Additionally, the wages paid are subject to the Minimum Wage Law (Law No. 137 of April 15, 1959), and wages are paid based on the minimum wage of each prefecture.

Conversely, in Employment Continuation Support Type B, since users engage in production activities without signing an employment contract, the Labor Standards Act and Minimum Wage Law do not apply.

However, facilities are obligated to pay "wages" to users who engage in production activities in Employment Continuation Support Type B.

According to Article 29 of the Ministry of Health, Labor and Welfare Ordinance No. 172 of 2006, it is stipulated as follows:

Designated facilities for supporting persons with disabilities must pay, as wages, an amount equivalent to the income from the business related to production activities, minus the necessary expenses for the business related to production activities, to those engaged in production activities in life care, employment transition support, or Employment Continuation Support Type B.

Source: Standards for Personnel, Equipment, and Operation of Designated Facilities for Supporting Daily and Social Life of Persons with Disabilities (Ministry of Health, Labor and Welfare Ordinance No. 172 of 2006)

In other words, Employment Continuation Support Type B pays "wages" from the income obtained by the facility from production activities, after deducting necessary expenses, rather than "salary" paid based on an employment contract like in Type A.

Incidentally, the average wage amount for Employment Continuation Support Type A and B in fiscal year 2022 is as follows:

Reference: FY 2023 Wage Results｜Ministry of Health, Labor and Welfare

If you want to know more about wages, please see

3.Is Tax Filing Required for Wages? Explanation on How to Determine

Generally, wages obtained through an employment contract, like in Employment Continuation Support Type A, are considered "employment income" and are subject to withholding tax and year-end adjustments by the facility, so there is no need to file taxes independently.

On the other hand, wages obtained from Employment Continuation Support Type B are referred to as "miscellaneous income," and since they are not subject to withholding tax or year-end adjustments, they are subject to tax filing.

However, if the total miscellaneous income is less than 650,000 yen annually, the special provision for necessary expenses for household workers applies, so there is no need to file taxes.

Reference: No.1810 Special Provision for Necessary Expenses for Household Workers｜National Tax Agency

Considering the average monthly wage for Employment Continuation Support Type B mentioned earlier, 23,053 yen × 12 months equals 276,636 yen, indicating that the likelihood of needing to file taxes is low in most cases.

Hypothetically, if the annual wage from Employment Continuation Support Type B exceeds 650,000 yen, the amount requiring tax filing is converted to a monthly amount of 54,166 yen or more.

Additionally, if there is other income besides wages and the total exceeds 650,000 yen, tax filing is required.

For example, if you earn income from a side job in addition to the facility's wages and the total exceeds 650,000 yen, it becomes subject to tax filing.

4. Where to Consult If You Cannot Determine Tax Filing for Wages on Your Own?

4-1. Consult a Tax Accountant Specializing in Employment Continuation Support Type B

When it comes to tax filing and tax-related matters, a tax accountant comes to mind, but each tax accountant has their area of expertise.

While it may seem that tax accountants are knowledgeable in all fields, their strengths and weaknesses vary based on their experience and the types of requests they usually handle.

Therefore, there are cases where requests may be declined if made to a tax accountant from a completely different field.

For those struggling with tax filing for Employment Continuation Support Type B, it is recommended to consult a tax accountant who specializes in disability welfare services.

Additionally, when choosing a tax accountant, it is also advisable to consider their past experience and achievements.

4-2. Consult the Tax Department or Tax Office of Your Local Municipality

You can also consult the tax department of your local municipal office or the relevant tax office in your area regarding tax filing.

However, the tax department of a municipal office generally deals with local taxes, unlike tax offices that primarily handle national taxes.

Therefore, it is advisable to call in advance to confirm whether they accept consultations on national taxes, such as income tax.

Similarly, when consulting a tax office, it is helpful to inform them of the nature of your inquiry over the phone in advance.

If you are unsure which tax office has jurisdiction over your area, you can search using the following link from the National Tax Agency.

Reference: Find the Location of Tax Offices｜National Tax Agency

4-3. Check the National Tax Agency's Website

The National Tax Agency's website lists individuals who need to file taxes under "Who Needs to File a Tax Return."

Reference: Who Needs to File a Tax Return｜National Tax Agency

However, since the information from the National Tax Agency alone may be difficult to visualize, let's assume you receive 300,000 yen annually in wages from Employment Continuation Support Type B and check if tax filing is necessary.

For income tax, a basic deduction of 480,000 yen is applied to everyone.

Reference: No.1199 Basic Deduction｜National Tax Agency

Additionally, there is a disability deduction for those who have obtained a disability certificate.

Reference: No.1160 Disability Deduction｜National Tax Agency

Combining these two deductions with the previously explained special expense of 650,000 yen, the calculation is as follows:

(Wages 300,000 yen − Expenses 650,000 yen) − (Disability Deduction 270,000 yen + Basic Deduction 480,000 yen) = −1,100,000 yen

As shown above, the taxable income is negative, indicating that tax filing is unnecessary.

Moreover, the National Tax Agency's website offers chatbot and phone consultation services, which can be a useful option.

Reference: Tax Consultation Services｜National Tax Agency

By simply entering the amounts inquired about, you can easily create a tax return and save the data, making it convenient.

5. How Will the 2026 (Reiwa 8) Tax Reform Affect Tax Filing for People with Disabilities?

In December 2025, the Reiwa 8 Tax Reform Outline was announced.

This document clearly states that the deduction amounts for income tax will significantly change starting from 2026 (Reiwa 8).

This will also impact tax filing for those earning wages from Employment Continuation Support Type B, so let's review the key points.

The first highlight is the increase in basic deductions and employment income deductions.

To address rising prices, the basic deduction will be raised from the current 480,000 yen to 620,000 yen.

Additionally, the minimum guarantee amount for employment income deductions will be increased from 650,000 yen to 690,000 yen, with a special measure setting it at 740,000 yen for 2026 and 2027.

Furthermore, the impact on the special provision for necessary expenses for household workers cannot be ignored.

The "special provision for necessary expenses for household workers," which is crucial for determining wages in Employment Continuation Support Type B, is set at 650,000 yen in 2026 but may change in line with the revision of employment income deductions.

Previously, wages below 650,000 yen annually did not require tax filing, but this threshold is expected to be further raised in the future.

Additionally, the requirement for the total income amount for the disability deduction will be raised from 580,000