Filing Income Tax Returns

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★Please refer to the National Tax Agency website for detailed information on how to file a tax return.

 

In Japan the fiscal year is from January 1 to December 31 and all residents of Japan, regardless of nationality, must pay taxes for income earned during the year. Taxation on income depends on and differs according to a person’s residency status; as such it is divided between resident (an individual having a residence in Japan for one consecutive year or longer) and non-resident (an individual who does not fall under the category of resident). Two forms of payment methods are utilized for income tax in Japan; filing of a tax return in which a taxpayer who is self-employed, self-assesses the income tax to be paid, and the withholding of income tax from a monthly salary before it is received by the employee.

All residents and salaried employees whose total income exceeded 20 million Yen, or received income from one source in Japan and earned additional income (ex. stock dividends) exceeding 200,000 Yen  (excluding retirement income), or received income from two or more sources, which was not subjected to the year-end adjustment.

 

Q: My company withholds income tax from my monthly salary, what do I need to do?

A: You will not have to report taxes if you are salaried or receive bonuses from one workplace, taxes have been deducted from your monthly salary, and your annual income is less than 20 million Yen. This system is called “gensen cho shu“. The amount of taxes paid over the course of one year may often differ from the actual amount due. In this case, on the last payday of the year, the difference between the actual and due amount is calculated and a year-end adjustment is made to complete and correct the employee’s tax payments. The employee may be eligible for a return or may have to pay additional income tax. This process is called “nenmatsu chosei”.

 

Q: My company will perform a year-end tax adjustment. Can I receive a tax refund?

A: If you are a residents and salaried employees whose tax was adjusted by the year-end tax adjustment may receive a tax return if:

  • You have paid a large amount (over 100,000 Yen) in medical expenses during the past year (excluding expenses refunded by their health insurance)
  • Your annual income for this year will be 2 million Yen or less.
  • You plan to leave Japan and receive lump-sum payments from the social pension plan after leaving Japan.
  • You left employment during the year and did not find new employment by the end of the year. The former employer is responsible for sending you a copy of your withholding statement, and then you must file on your own.
  • You have obtained a mortgage to buy your own residential property in Japan or have made renovations/additions to your residential property in Japan during the past year.

 

If you changed your visa status from a non-resident working-holiday visa to a resident-eligible visa (working, spousal, etc) during the year you may be eligible for a tax return, but taxes paid during the period under the period of the working holiday visa cannot be returned.

 

Q: How do I file a tax return?

A: Tax returns for income earned during the previous calendar year must be filed between February 16 and March 15 each year. If you file after this date, you may be liable to pay a penalty. To file your tax return, you must fill in the appropriate forms and submit them to your local branch of the National Tax Office, together with your “Withholding Statement” (see below); insurance slips and medical or business related receipts should also be included. The staff at the tax office will then help you to calculate the amount you owe /should receive.

 

Q: What items am I required to submit when filing taxes?

A: The basics include your Alien Registration Card, passport, bankbook, inkan (if you have one), and “Withholding Statement” (see below), along with any other documents showing any other sources of income. For an exemption for overseas dependents proof such as a birth certificate or a marriage certificate along with bank transfer statements are required. For an exemption on medical expenses all medical statements and receipts are required. For those who purchased housing, all relevant loan documents are required.

 

Q: How can I receive a tax refund if I am leaving Japan?

A: It is possible to receive tax refunds in the following three situations when leaving Japan:

1.If your employer carries out a year-end adjustment, the person in charge of withholding taxes will forward any tax returns paid to you. No further action is required.

2. If you do not file you taxes before leaving Japan, by filling out a “nozei kanrinin no todokedesho” (“Declaration Naming a Person to Administer a Taxpayer’s Tax Affairs”), you may nominate a friend or tax official to be your representative responsible for filling your taxes during the proper filing period, and in the case you receive a refund, accept and forward your reimbursement to you.

3.If you turn in your tax return by yourself and are due to receive a tax refund, you will need to appoint a tax official, or someone else, to be your representative in order to receive your reimbursement by submitting a “i-nin-jo” (letter of attorney) when you file your taxes before you leave. A copy of your ARC or passport should be left with the representative.


Income Tax Counseling in English

An English-speaking tax counselor can provide free tax consultations and related information over the phone in complete confidence at the Nagoya Regional Taxation Bureau  (Naka Ward).

Tel: 052-971-2059 Hours: Mon – Fri (09:00 – 12:00 & 13:00 – 17:00); closed on holidays.

Examples of problems they can help with:

  • Whether you must file a final return or not.
  • What documents to bring to the tax office when filing.
  • Whether you are a resident or non-resident taxpayer.
  • Whether your income is taxable in Japan or abroad.
  • What tax treaties your country has with Japan and whether you may be tax-exempt.
  • Questions you may have before going to file at your local tax office.
  • Questions you have always wanted to ask in confidence about Japanese taxes.

To learn more about the Nagoya International Center,
please watch our video.

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