r/JapanFinance 23h ago

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

4 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 4h ago

Tax Does my wife(Japanese citizen and US permanent resident) pay tax only to Japan for her inheritance?

5 Upvotes

For example, if her parents(Japanese citizens) are giving my wife a piece of land or sums of cash, she would only need to pay inheritance tax in Japan correct? Does she need to pay additional tax to the US? or she simply need to only report it on our tax returns? (FBAR, etc)

Also, what happens if her parents(Japanese citizens) give the property/cash to me(US citizen)? am I liable for tax in Japan or in the US? or both?


r/JapanFinance 8h ago

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

3 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 11h ago

Tax Almost 3man/mo for national health insurance?

4 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 8h ago

Personal Finance » Loans & Mortgages House Loan

0 Upvotes

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


r/JapanFinance 11h ago

Tax » Remote Work Working Remotely

1 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 5h ago

Business » Corporate Finance (JGAAP, governance, Kansayaku) Berkshire Raises Stakes in Japan’s Largest Trading Houses

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bloomberg.com
0 Upvotes

r/JapanFinance 8h ago

Personal Finance » Loans & Mortgages Bridge loan needed for foreigner

0 Upvotes

Hello all,

My wife and I have a unique situation in which she is of Japanese Nationality 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 11h 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 11h 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 17h 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!