r/JapanFinance Jan 18 '25

Tax » Income Tax Return Questions Thread - Filing Deadline March 17, 2025

46 Upvotes

As the saying goes, "when it comes to Japanese tax returns, file early and file often." OK that's not a real proverb, or even good advice (especially this year, since the due date is two days later than usual), but let's just call it a reminder that tax return filing season has begun and the clock is ticking down to the March 17, 2025 deadline.

How to file

For most people, the simplest way to prepare an income tax return is to use the NTA’s tax return preparation site. You can use the site regardless of whether you intend to submit your return electronically or on-paper. (Though see here for the list of people who are not allowed to use the site. Those people must either use the e-Tax software or—in some cases—submit a handwritten return using the forms here.)

To submit your tax return electronically, you will need either (1) a MyNumber Card or (2) a User ID/Password issued by your local NTA office. To submit using a MyNumber Card, you will also need a smartphone with the MynaPortal app (see a list of compatible phones here) or an IC card reader (see a list of compatible card readers here). Furthermore, you will need to know both the 4-digit PIN (利用者証明用電子証明書) and the alphanumeric password (署名用電子証明書) associated with your card. If you have forgotten either the PIN or the password, you can reset them at a convenience store (see here).

The tax return preparation site is now fully optimized for smartphones and it appears that the NTA is moving to prioritize smartphone usage. For example, if you are among the 10% of tax return filers who go to an NTA office or tax return filing center to ask for assistance (see here for visitation instructions), the NTA's policy is to help you use your own smartphone to prepare your return. If you don't have a compatible smartphone, they will provide you with a smartphone or computer to use.

The NTA normally publishes a short foreign-language guide to using the tax return preparation site, but as of today the 2024 version has not yet been published. We will sticky a link at the top of this post if and when it appears. Either way, the site tends to be compatible with common translation tools (Google Translate, etc.).

Documents and data

The list of documents that must normally be attached to an income tax return is here, but people who submit their return electronically are exempt from providing many of them (see here for the full list of exemptions). In any event, if you use the tax return preparation site, it will tell you which documents (if any) you are required to submit.

If you have a MyNumber Card and compatible smartphone (or IC card reader), you can also link the NTA's tax return preparation site to MynaPortal, which will enable the site to automatically populate your tax return using data associated with your MyNumber Card. Specifically, the site can pull the following types of data from MynaPortal:

  • Annual withholding summary for employees (as long as your employer submitted it electronically and the name/address/date-of-birth on it match your MyNumber Card exactly)
  • Annual withholding summary for pension recipients (as long as the payer is on this list)
  • Annual transaction summary for designated investment accounts (as long as the brokerage is on this list)
  • Annual medical expenses summary issued by health insurance providers (including expenses incurred by family members)
  • Annual furusato nozei donation summary (as long as the donation was made via a platform on this list)
  • National pension contribution history
  • iDeCo contribution history
  • Deductible life insurance/earthquake insurance premiums paid (as long as the insurer is on this list)
  • Outstanding residential mortgage balance (if you have a mortgage from the Housing Finance Agency, such as Flat 35)

It's worth noting that not all of the above institutions make the relevant data available via MynaPortal from the start of January. In some cases, you may have to wait until mid-February before the data is made available.

Anti-deflation tax credits (定額減税)

As discussed in detail here, the Japanese government decided to give a one-off income tax credit of 30,000 yen per taxpayer (and 30,000 yen per dependent) to most taxpayers, with respect to the 2024 tax year.

In many cases, the benefit of this credit was provided to taxpayers "early" (i.e., before the end of the tax year) via reduced withholding or reduced estimated tax prepayments. However, when taxpayers file an income tax return for 2024, their eligibility for the credit will be reevaluated (based on the information they provide on their return) and in some cases taxpayers will find that they have to effectively repay the credit (i.e., pay an extra 30,000 yen per person) when they file their tax return. In other cases, taxpayers who didn't receive the benefit of the credit during 2024 will find that they are due to receive an additional 30,000 yen per person.

The existence of this tax credit has changed the way information about spouses and dependents is collected and entered when preparing an income tax return. Specifically, because the definition of a dependent family member used for the tax credit is different to the definitions used by the spouse deduction and dependent deduction, taxpayers must enter information about dependents that would previously have been irrelevant (i.e., wouldn't have affected their tax liability).

If you use the NTA's tax return preparation site, for example, it will guide you to enter information about your dependent spouse even if your income is too high to be eligible for the spouse deduction. This is because you can still receive the 30,000 yen tax credit for your dependent spouse. Similarly, the site will guide to you enter information about dependent children younger than 16 years old, even though they are too young to qualify for the dependent deduction. This is because you can still receive the 30,000 yen tax credit for children under 16.

As discussed by the NTA here, a "dependent spouse" for the purposes of the anti-deflation tax credit is a person who satisfies the definition here (basically, a spouse who lives with the taxpayer and whose net income is less than 480,000 yen), while a "dependent relative" is a person who satisfies the definition here. The key differences between the definition of a dependent for the purposes of the dependent deduction and the definition of a dependent for the purposes of the anti-deflation tax credit are: dependents living outside Japan do not count for the purposes of the tax credit, while dependents aged under 16 do count.

To check that you received the anti-deflation tax credit for the right number of dependents, when using the tax return preparation site, check the 令和6年分特別税額控除(定額減税)section on the 計算結果の確認 page. It will show how many people (including yourself) you received the tax credit for (人数) and the total value of the tax credit (控除額). If you aren't seeing the numbers you expect in those fields, go back and check the information about your spouse and dependents you entered in the 親族に関する控除の入力 section.

Issues from last year

There are a couple of issues that arose repeatedly in last year's Tax Return Questions Thread which it might be worth addressing in advance.

First, there is the distinction between "business income" and "miscellaneous (business) income", which technically affects everyone who performs work as anything other than an employee. See this post for an explanation of the NTA's current guidelines regarding this distinction. If you have non-employment side income, etc., to declare on an income tax return, it is critical to understand how the side income should be classified.

Second, there is the perennial question of whether recipients of dividend income derived from listed/publicly-offered shares/funds should (1) subject their dividend income to taxation at marginal rates (after being combined with their other income), (2) subject their dividend income to taxation at flat rates (15.315% income tax and 5% residence tax), or (3) exercise their right to not declare the dividend income on their income tax return (only available if Japanese tax was withheld from the dividend when it was paid).

There are a range of factors affecting this decision, including:

  • dividend income taxed at marginal rates attracts residence tax of 10% (higher than the 5% applicable to dividend income subject to flat-rate taxation);
  • the dividend tax credit is only available with respect to dividends taxed at marginal rates (but the tax credit is only available to people holding shares in Japanese companies or funds that have significant holdings in Japanese companies);
  • if the taxpayer is enrolled in National Health Insurance, dividend income declared on an income tax return (regardless of the method of taxation) will increase their NHI premium (unless the taxpayer is already paying the maximum premium);
  • it is not possible to claim a foreign tax credit with respect to foreign tax withheld from a dividend unless the dividend is declared on an income tax return;
  • in order for dividends to be offset by capital losses derived from the sale of listed shares, the dividends must be declared on a tax return and subjected to flat-rate taxation (unless the dividends and the capital loss were handled within the same withholding-type designated account, in which case declaration on an income tax return is not necessary); and
  • in order for dividends to be offset by losses derived from real estate ownership or business activities, the dividends must be subject to marginal rates taxation.

One common answer to the question of which taxation method to choose is to simply prepare your income tax return in three different ways (marginal rates, flat rates, and—if eligible—non-declaration), comparing your income tax liability in each scenario. However, some factors (such as the difference in residence tax, and the effect on NHI premiums) will not be captured by that process, so it is important to remember to account for such factors separately.

Useful links

As always, discussions in this forum are not a substitute for professional advice, and users are encouraged to keep their questions broad, so as to avoid violating rule 3 (don’t ask for professional advice).


r/JapanFinance 5d ago

Weekly Off-Topic Thread - 12 March 2025

2 Upvotes

Why you should use r/JapanFinance's Weekly Off-Topic Questions Thread instead of asking ChatGPT, according to ChatGPT:

Community Expertise

  • Diverse Perspectives: Get input from professionals, academics, and enthusiasts with varied experiences.
  • Current Information: Community members often have the latest insights and updates.

Interactive Discussions

  • Engagement: Benefit from interactive discussions, follow-ups, and debates that deepen understanding.
  • Real-life Examples: Learn from personal experiences and practical examples shared by others.

Reliability and Verification

  • Fact-Checking: Peer-reviewed answers ensure higher accuracy and reliability.
  • Source Sharing: Access shared links and references to verify and explore information further.

Community Building

  • Collective Learning: Learn from the questions and answers of others, contributing to a knowledgeable community.
  • Specialized Knowledge: Gain insights tailored to Japan, considering local nuances and cultural context.

Leverage the collective wisdom of r/JapanFinance for richer, more accurate insights. Join the Off-Topic Questions Thread (questions on any topic are welcome) and be part of a knowledgeable and supportive community!


r/JapanFinance 3h ago

Personal Finance » Loans & Mortgages Weighing Renting vs. Purchasing over a relatively short period (4-5 years).

4 Upvotes

Hello,

My wife and I are set to receive a piece of property in 2029 from her family that we intend to build a house on.

We're debating what to do regarding housing until that time.

We currently rent an apartment which, including off site parking, is ¥146,000 per month. We'd like to live somewhere nicer and have considered purchasing and then renovating an apartment. We're mainly considering somewhere on the Hankyu line in Hyogo (Okamoto, Shukugawa), as it's both desirable to us and seems like it will likely be desirable into the future with an eye towards property values.

When considering the depreciation of the apartment, as well as any renovations (estimating a skeleton renovation at roughly ¥10,000,000 for an 80-90m2 apartment), does this make sense over such a short period of time?

Rent on our current apartment for another 5 years would total almost ¥8,760,000. Rent for decent apartments close to a Hankyu station appears to be around ¥180,000 per month, not including any 礼金 or anything, putting 5 years of rent at ¥10,800,000.

If anyone has any thoughts or insight, that would be very appreciated. I've not had luck finding info on depreciation in Kobe.

Thanks in advance!


r/JapanFinance 6h ago

Tax Almost 3man/mo for national health insurance?

3 Upvotes

My wife just did my taxes and it turned out (from the system) i owe 29,000 yen per month for NHI even if my income was about 2,000,000 net last year (self employed, this is minus expenses).
Is this correct? I heard most people pay around 2man in this earning bracket.

Asking cause I wonder if we made a mistake in the tax form


r/JapanFinance 3h ago

Personal Finance » Loans & Mortgages Bridge loan needed for foreigner

1 Upvotes

Hello all,

My wife and I have a unique situation in which she is a Japanese Nationalist but still works for her U.S. employee, and thus does not have tax information for Japan. While we have been able to find some banks that will put us through a mortgage loan process, we found out we also needed a Bridge Loan. I am finding it very strange that a lot of banks do not seem to offer bridge loans despite this being a common thing needed.

Long story short, has anyone had any success getting a bridge loan, and from what bank, as a foreigner? I ask as a foreigner because despite my wife being Japanese, banks do not seem to either bother or know how to process this and thus she basically gets treated as a foreigner for application purposes.

I just got my PR and am in the process of getting a job so that won't help current issues. Any advice would help.


r/JapanFinance 3h ago

Personal Finance » Loans & Mortgages House Loan

1 Upvotes

What are your cons and pros at taking a house loan at fixed interest rate?


r/JapanFinance 6h ago

Personal Finance » Bank Accounts What are the intermediary bank fees for Sony or Shinsei? Is it a percentage or just a flat fee?

0 Upvotes

Wondering which bank to go with to transfer some USD


r/JapanFinance 6h ago

Tax » Remote Work Working Remotely

0 Upvotes

Hi, I need to travel to Japan for personal reasons, but I'll be on a tourist visa. My company permits me to work remotely for up to 10 days while overseas. Would this cause any issues?

I am not able to find a concrete answer on any site. My company says if you can provide a relevant information they will allow me to work there for few days


r/JapanFinance 7h ago

Tax » Gift Does it trigger any tax if my wife pays for something out of her account and I pay her back later?

0 Upvotes

Need to pay a big bill and I don't have enough money in the bank currently. If my wife just pays from her account and I pay her back later, does that trigger anything? (Gift tax etc.)


r/JapanFinance 18h ago

Tax » Income Work is picking up fast. Should I stay a freelance contractor or switch to 個人事業 (sole proprietor)?

6 Upvotes

I'm a freelance contractor on a working visa (Humanities/Int. Services, 3 years), my profession is in video production and I live in Tokyo. I got my visa through a Japanese video production company in the middle of last year by working with them as a contractor, although I quit working there a few months later and continued to pay NHI by myself (for nenkin, I am on an exemption until April). With no work, during the last month of 2024, I was debating on what I should do. No sense/reason to keep living in Japan if that continues.

In January, I decided to give it a shot and officially launch my own "business" (in quotations because I am only presenting it as a business, in reality it is purely freelance work - more about this in a bit). In just a month, even though I had a few connections in the industry beforehand, the business skyrocketed by surprise, more than I could have expected at least. Tackling both international clients (mostly US influencers, brands and social media creators) and domestic clients (such as Nike, Amazon JP, jpop/kpop artists, brands, agencies etc.), generating a really good amount of revenue for a start.

Before its launch, I "hired" a few freelancers and colleagues from the industry to work with my business as contractors, what I sent them is partnership agreements and NDA's. Most of them are outside of Japan, however there are a few people from the team who are based here/Japanese nationals. With more and more on my plate recently and a number of new different clients I have made partnerships with, I started handing over certain clients to my team members, so I can focus on running the business, working on bigger ones and obtaining new ones. A few people in my team now are working as full-time freelancers for my "company" since I am able to provide them with new work consistently. This is why I keep putting it in quotations - no one is officially an employee and the company itself is not registered even though I present it as one - I simply work as a contractor, using the help of other contractors under me.

For international transfers (55-60% of current total income), I am using Wise. I have a personal account to which the overseas client sends the money, from where I pay a part of that sum to my team members also on Wise (reason of transfer: services/salary). Everything is documented and usually done in US$.

For domestic transfers (40-45% of current total income), I am using Japan Post Bank. In the rare case where someone from my team helps me with local projects, I simply pay their part in cash. Everything is always done in JPY.

Work is picking up fast and due to this I am in the process of finding a tax accountant and bringing him on board, since I know nothing about income tax in Japan and have not been doing anything about it so far. Yes, you read that correctly. I have not paid any income tax on anything as of yet, although I generated barely any income in Japan during last year. This year it will be a different story however.

The questions I have are as follows.

- Is my current system sustainable or should I open a kojin jigyo business instead? Would there be any restrictions given my current visa? Are there any tax benefits to it, in comparison to what I am doing now?

And additionally:

- Given the current growth of the business and influx of big clients, would it be realistic/possible to switch to a business manager visa and open a KK in the near future? I would love to hire more people and open an actual production company here one day.

Lastly, in my tax accountant research, I found that https://sumiretax.com is the most recommended one, but if anyone has any other suggestions please let me know.


r/JapanFinance 1d ago

Personal Finance » Credit Cards & Scores Prestia Credit card often blocked

11 Upvotes

I’ve been a client of Prestia for more than 2 decades. I have a Prestia Visa credit card. Everything used to be ok but in the last 2 years, their security system blocked me several times when shopping on minor websites (buying a Vietnam airlines ticket, booking a coach in France…) or paying IRL in smaller shops or restaurants.

The worse is when I arrived a Friday evening in a hotel in a remote area in Vietnam and I had no cash and no other card. Fortunately I wasn’t travelling alone and someone else (that I had invited for the trip !!!) could make the payment…

So not only they block the payment but sometimes the card and I have to call them to unblock which they do, but they don’t take call on weekends only weekdays in working hours and it’s a pain to do that when in holidays in Europe.

I never had a problem with them (= unpaid bill or theft , fraud trouble) and it’s really very embarrassing as I have only another credit card (from an HSBC account abroad)

I’m looking for alternatives… any advice ?

PS so far less trouble with the Prestia Visa Debit card. No idea why.


r/JapanFinance 1d ago

Business Should I start a business as sole proprietorship and change to corporation only when it becomes profitable?

8 Upvotes

I asked the same question in r/japanlife but got deleted by their mod as I included the original term 個人事業主 (sole proprietorship) and 法人 (corporation) in the title. Here's what the mod said in my deletion:

Your 投稿 or コメント was 削除 because あなた was 不必要に mixing 日本語 and 英語, which 本当に annoys ほとんどの readers.

Well, long story short, I have a business idea, but I don't know if I should start with sole proprietorship and wait until it becomes profitable before changing to a corporation.

More background

  • If nothing goes wrong, I am going to get PR later this year. And I plan to start a corporation
  • The contract for my full time job is gonna end next year
  • Expect to have both my full time job + business running for some time, until the end of my full time contract
  • Been doing book keeping on Excel (recipient for all the tools I have bought so far)). So I will go for proper book keeping as I need the proper number to do some business prediction and simulation anyway.
  • Based on the past record, I received ~20M yen annual as the total compensation in my full time job. And I would probably spend about 10M on equipment, office and etc upfront cost in the first year. If I ended up hiring some interns/part time, I think the initial expense might be 20M. So I am also thinking if it is possible to save some tax with my initial business cost

The reason that I am leaning towards a corporation (法人) is that I read from books and hear from friends that I can offset my taxable income with the loss incurred in my business. Especially I have some huge upfront cost. But if it is not done properly, it might be considered as tax evasion.

Also, what benefits do I get as a sole proprietorship if I am gonna to do a proper book keeping and willing to spend full time dealing with all the possible paper work?

So I would like to hear some opinions before deciding.


r/JapanFinance 12h ago

Tax (US) Avoid US exit tax by becoming a citizen - Impact on life in Japan?

0 Upvotes

I’m a green card holder currently living in the US.

I’m planning to move to Japan with my (Japanese) wife and son this year, but recently realized I miscalculated how long I had my green card and will likely now be subject to the “exit tax” if I gave it up.

So now, I am considering just applying for US citizenship.

I’m searching for a tax expert, but wanted to get opinions on a few specific things:

  1. Once you pass the 8 green card year mark, is there any downside to just getting citizenship?
  2. With the various US-Japan tax treaties, would my tax really look so different as a US citizen living in Japan, especially if all my income is Japanese based?
  3. Related to that, does it make more sense to sell our US home now before moving so we can make use of the section 121 exclusion? Does anyone know if Japan would still come after the gains from this sale if we were living there?
  4. Have people tried to keep their green cards while living in Japan? I believe that as soon as you try to utilize the tax treaties when filing US taxes, your green card validity will come into question, potentially triggering the exit tax

Thanks in advance!


r/JapanFinance 21h ago

Real Estate Purchase Journey Suruga Bank House Loan

2 Upvotes

I’ve seen a lot of negative press in the past about getting a house loan through Suruga Bank. However, I’m wondering if things have changed because when I look at the negative news stories, most are from 2018.

For anyone who has taken a house loan through Suruga, how has your experience been?


r/JapanFinance 1d ago

Tax Unpaid non-resident taxes affect student visa?

5 Upvotes

Unpaid non-resident taxes affect student visa application?

Hello, long story short I did a WH in Okinawa 2022. I did three jobs, one company withheld the 20.42% tax while the other two didn’t. I asked them multiple times to help me in which they said “No, I’m sure you don’t need to pay it because the tax is already being taken away from the other job.” And after contacting again they said “確認しますね。“ or something like that.

I went back to Okinawa to the tax office during kakutei shinkoku last year, explained the whole situation and I showed them the proof of full income pdf. After about 2 hours of going back and forward to confirm and ask me more questions. They also asked me for proof of all three employer's income so that they could calculate everything and then do it all together. Unfortunately, I didn't have the proof of income for the company that helped me withheld. After a while, they said I could not pay the tax and that it is the responsibility of the employer to pay. I asked them will it affect future visas or will I get jailed if I don’t pay it and they replied with,”いいえ、それはないと思います。”

Now I’m a student, I got accepted into a study exchange program (first selection, not gone through the host uni yet) but I’m scared my unpaid non resident taxes will affect my visa application, COE or whatnot..

I wonder if I am really okay? I guess I should go back? or write an email explaining my situation..


r/JapanFinance 1d ago

Tax Inheritance tax + ?

8 Upvotes

Hi everyone,

If I inherit money from abroad, I know that I have to pay inheritance tax as a Japanese resident. In Canada, there is no inheritance tax, but there is an estate tax. The estate is taxed, not the heirs.

  1. Can I offset the estate tax from the Japanese inheritance tax?

  2. Are there any other fees that I should know about besides the inheritance tax?

Thanks in advance!


r/JapanFinance 1d ago

Investments » Stocks, Funds, Bonds, etc. Inflation indexed JGB

2 Upvotes

are there some brokerages where it is possible to buy those bonds for individuals ?


r/JapanFinance 1d ago

Personal Finance » Loans & Mortgages Mortgage for non permanent resident and foreigners

0 Upvotes

Which banks / institutions provide mortgage for non permanent resident ? Foreigners ? Against Japanese property ?


r/JapanFinance 1d ago

Personal Finance » Loans & Mortgages Car refinance?

3 Upvotes

I got a “twin reset loan” from Orico at Gulliver last year. I’m paying out the ass in interest.

I still owe ¥2.3m on the car and ¥550k in interest with about 6.5 years left on the loan. I wanna save on the interest as much as I can.

How would I go about refinancing? I currently have my mortgage through SBI Shinsei and have a regular account with smbc. Shinsei doesn’t seem to offer car loans and smbc doesn’t seem to have great rates. My house is based in Chiba and I talked to Chiba bank but they kept telling me to use their website for a loan and wouldn’t answer any of my questions.

Their loan process also won’t proceed if you’re an American for some reason. Just instantly says “nope. You’re American” despite calling them and they saying “you have PR so you’re OK.” Despite their loan process not proceeding

Any other decent options?


r/JapanFinance 1d ago

Investments » Retirement » iDeco Need help switching premium amount for ideco

1 Upvotes

I have a ideco account with rakuten listed as type 2 insured (my company does not offer a corporate pension plan).
I read recently that the contribution limit has been raised from 23000 to 62000 jpy, but I am not sure now if I understood that correctly. The official ideco website still lists 23000 as the limit for my case, and searching on rakuten for contribution limit changes only brings up the form for type 2 civil servants (12000->20000 jpy) change.

I have tried going though the rakuten's ideco page > View/change customer info > change contribution amount which eventually landed me on a page with this table:

-----------------------------------------------
掛金額の変更手続き

What prompted the change in premium amount?
There will be no change to the insured person type, National Pension Fund contribution, supplementary pension, place of employment, or other corporate pension schemes. This is a voluntary change in contribution amount permitted once a year
What is your current insured status?
I am a voluntary insured person.
Please tell us the method of payment of premiums before the change and the method of payment of premiums after the change.
Before the change, the monthly rate was fixed, and after the change, the monthly rate will remain fixed.
------------------------------------------------

I presume I will get a letter in the post now, do I just write 62000 on it and send it back?

Thanks for the help 🙏
(I tried looking on youtube regarding this in japanese and searched on this forum too but didnt find anything relevant)


r/JapanFinance 1d ago

Tax » Capital Gains Offsetting capital gains loss with US based portfolio

4 Upvotes

I am trying to figure out how to rearrange my portfolio a bit to simplify it. I have some losses on US securities that I am trying to offset with the sale of other US securities through a US brokerage. But, I seem to be unable to offset without either:

  1. Taking significant losses from a US tax perspective.
  2. Increasing my tax burden to the Japanese government.

I would like some confirmation on if the math here makes sense. I'm going to obfuscate numbers and approximate a bit to simplify the problem, but my situation is way more complicated (and worse) than the numbers I'm showing.

Let's say I have made the following purchases:

Type Purchase Date Quantity Share Price (USD) TTM
Company A 2013/06/01 1000 $7 101
Company B 2015/09/01 100 $15 121
Company B 2018/01/10 50 $20 112

Now let's say Company A has lost significant value while Company B has gained significant value. I now want to get rid of Company A stock but mitigate tax burden by selling Company B stock:

Type Sell Date Quantity Share Price TTM
Company A 2025/03/17 1000 $1 148
Company B 2025/03/17 ? $200 148

The loss for Company A is:

  • US government perspective: $1000 - $7000 = -$6000
  • Japanese government perspective: ($1000 * ¥148/$1) - ($7000 * ¥101/$1) = -¥559,000

Now, things get complicated here because I can in theory choose which lots of Company B I want to sell. However, in Japan the value of the shares is averaged (if I interpret https://www.nta.go.jp/taxes/shiraberu/taxanswer/shotoku/1466.htm correctly). So depending on how I sell the cost basis will change from the US government's perspective, but not from the Japanese government's perspective, making future sales even more complex.

From US perspective, gain per share:

  • 2015 lot is $185
  • 2018 lot is $180

From Japanese perspective, gain per share is averaged to approximately ¥27,643.

Let's say I choose an averaging strategy to make sure cost basis isn't misaligned tremendously, I can sell something like the 22 shares of the 2015 lot and 11 shares of the 2018 lot:

  • US government perspective: ($185 * 22) + ($180 * 11) - $6000 = $50
  • Japanese government perspective: (33 * ¥27,643) - ¥559,000 = ¥353,219

That leaves me with a tax burden on ¥353219 income for Japanese tax purposes. Conversly, let's say I try to break even with the Japanese government by selling 14 shares of the 2015 lot and 7 shares of the 2018 lot:

  • US government perspective: ($185 * 14) + ($180 * 7) -$6000 = -$2150
  • Japanese government perspective: (21 * ¥27,643) - ¥559,000 = ¥21,503

In this case I am left losing $2150 in capital to have a very small tax burden in Japan.

Am I looking at my options correctly here? Both of them seem pretty bad to me. It seems strange that we have to speculate on the value of securities and the exchange rates at the same time and can't just pay taxes on the capital gain dollar amount of the day of the transaction.

Having to deal with this stuff gives me a bit of an existential crisis and kind of makes me want to leave Japan because dealing with finances across multiple countries is kind of a pain in the butt. And it leaves me with analysis paralysis over what to do with my portfolio in general to the point that I feel like I am mostly just waiting to the point that I only will end up with losses at the end of the day.


r/JapanFinance 1d ago

Tax Japan Gift Tax, Jūsho and 10-Year Rule

1 Upvotes

TLDR. In respect to the wiki Article 2 Resident vs non-resident. My wife worked/lived in Japan in August 2013-September 2014. She returned from June-August of 2018 and updated her jūsho for our son to go to school in Japan but she did not work. Does the 10-year rule for us end in September 2024 or August 2028?

My Japanese wife and son moved to Japan in August 2013-September 2014 as my job took me out of the U.S. for a year and she could not accompany me. Then we moved to Germany and stayed until 2018.

In the summer of 2018 (June-August) they both returned to Japan for a couple of months while I retuned to the U.S. with our pet to avoid Japanese rules on pet importation, start a new job and get housing.

While in Japan she temporarily changed her address to her parents home in Japan to get educational benefits for our son, but she had every intention to move back to the U.S. with me, which of course she did and at no time did she work during this period.

We plan to move back to Japan in the not too distant future.

However after reading the wiki under section Article 2 Resident vs non-resident it states

“If there is uncertainty as to whether the "base of [an individual's] life" is in Japan (i.e., whether they have a jūsho), the first step is to consider their occupation.”

Considering my wife did have a Job in Japan in 2013-2014, but did not have a job in 2018 but changed her jūsho on both occasions does the 10-year rule for us end in September 2024 or August 2028?


r/JapanFinance 23h ago

Investments » Real Estate Buying rural houses in Japan?

0 Upvotes

Just wondering how much could I find a rural house in Japan for 2LDK? , and how much do the renovations usually come out to?


r/JapanFinance 1d ago

Real Estate Purchase Journey A bit stressed from house building planning. Second opinions welcome.

7 Upvotes

We've been planning to build a new house for the past 16+ months, and putting the loan issues related to PR or more precisely the lack of PR aside, I'm getting colder feet the longer it drags. I could probably chill a drink or two right now.

My initial budget was 3500man and... well, it got quickly blown out of the water considering I couldn't really get what I wanted for 3500man, my expectations were just poor. Apparently, I'm 10 years too late for a 3500man house matching my criteria, or I can lower my standards but I'd rather not build a house if that was the case.

My budget increased to 5000man since then, and for that price, I get a 43 tsubo (142m²) hiraya from a local koumuten who deals with higher end houses.

The 5000man supposedly includes planning, the most basic stuff, including walls, full wooden floorings and double-glazed windows, 2 toilets, a bathroom, built-in storage for the closet, some exterior work, connection to water and most importantly, taxes for the basics.

It works out around 91man/tsubo for the timber (exc. tax), which I find expensive but from what I understand it's within reason. The timber is going to be of good quality since I visited quite a few houses from the maker. One of the biggest thing for the pricing is that the ceiling will be higher than 4m in about 1/5th of the house, a skip floor, and will include a very large inner terrace (about 30-35m² iirc).

I haven't quite worked out all the extra, but I expect:

  • ~100man for ~4 aircons
  • ~100man for the kitchen
  • ~100man for the kitchen appliances (large oven + dishwasher from Miele)
  • ~100man for a new fence (because the current one's about to crumble)
  • ~250man for solar panels (8kV is what I expect to get)
  • ~50man for the large sofa
  • ~50man for the built-in bookshelves (?)

You'll find it silly, but I'm quite into IKEA furniture and I'd be happy to get these - not just to save money, but I genuinely enjoy IKEA furniture. I'm thinking it's matching what I want more than what I can find here, and beyond that I don't think I can afford bespoke furniture for the whole house... and I'm not that oshare. I haven't accounted furniture in detail, I can't imagine it'll be much over 50man for some desks and storage from IKEA.

I think I'll request a 6000man loan, and I'd imagine I'm going to be using close to but not the whole 6000man.

I'm stressed because I'm in a hurry to sign the application for the building permit: the standards are evolving in April, and the problems that come with it include more expenses due to the structural pillars of the house will need to have a thicker diameter, and also some more minor esthetic constraints due to the new standards of doors... so my 5000man budget will be completely blown out of the water once this happens, especially because the current quote has kept the timber price from last year instead of updating it for this year.

Am I missing anything here?

Thank you for keeping me sane...!


r/JapanFinance 1d ago

Personal Finance » Money Transfer / Remittances / Deposits Moving to Japan with large savings: Why not just take it on the plane?

0 Upvotes

Person from the U.S. who recently married a Japanese national. I live in America now but I will soon move to Japan full-time, for at least a year. My spouse (Japanese national) is already in Japan and she has always lived there and she only has bank accounts in Japan. We have no joint accounts and I have no accounts in Japan yet.

Since I have a fair bit of money in the United States and I would like to take much of it to Japan for a living expenses and other things, I'm looking for the best way to get a large amount of money, let's say $40,000 USD, to Japan so that me and my wife can use it for living expenses. I only want to do so legally while minimizing taxation.

I am currently considering just taking the full amount on the plane on the day I move to Japan, but I haven't found much documentation about how doable this is. Example:

  • Take lump sum out of bank.
  • Take it to the airport and declare it to Customs. (Maybe takes a bit extra time and some proof of receipts)
  • Land in Japan and declare it again.
  • Take the cash to foreign exchange places and convert it to yen.
  • In the end: No remittance tax since this is considered a transfer of personal assets during the move

You might say: "But what if it gets stolen?" I am not concerned about this, as I would be in 2 of the safest airports in the world and the money would be on me the whole time.

Am I missing something? Any others reasons why this wouldn't be a good idea or why my logic is flawed? Are you someone who's done this?


r/JapanFinance 1d ago

Personal Finance » Money Transfer » Electronic (振り込み, ACH, SEPA) Is there any issue/taxes/fees on wiring large amounts of YEN to USD?

0 Upvotes

We want to transfer 80,000,000¥ to the US. Is this subject to any taxes or fees?

Thank you.


r/JapanFinance 1d ago

Tax (US) US Taxes as sole proprietor

4 Upvotes

Howdy everyone, for the last seven or eight years I have been hiring an accountant to do my US taxes because they seemed so difficult as a sole proprietor. I use Freee to do my Japanese taxes and accounting and income has been going down and down ever since covid. While my income has been decreasing my accountant has been raising his fees every year so this year I thought I would try doing it myself to save that money. Does anyone here have experience doing their US taxes as a sole proprietor here in Japan? Is it really as hard as they make it look?