If you’re a foreigner living and working in Japan, tax season can feel overwhelming. Between income tax, residence tax, and a filing system that’s mostly in Japanese, it’s easy to feel lost. But here’s the good news: once you understand the basics, filing taxes in Japan is actually quite straightforward — and you might even get money back.
This guide breaks down everything you need to know about tax filing in Japan for foreigners, from understanding your tax obligations to actually submitting your return.
Understanding Japan’s Tax System: Two Taxes You Need to Know
Japan has two main taxes that affect your paycheck:
1. Income Tax (Shotokuzei / 所得税)
This is a national tax collected by the central government. It’s progressive, meaning the more you earn, the higher your rate. Here are the current brackets:
- Up to ¥1,950,000: 5%
- ¥1,950,001 – ¥3,300,000: 10%
- ¥3,300,001 – ¥6,950,000: 20%
- ¥6,950,001 – ¥9,000,000: 23%
- ¥9,000,001 – ¥18,000,000: 33%
- ¥18,000,001 – ¥40,000,000: 40%
- Over ¥40,000,000: 45%
On top of these rates, there’s a 2.1% reconstruction surtax applied to your income tax amount (not your income). This was introduced after the 2011 earthquake and is still in effect.
2. Residence Tax (Juminzei / 住民税)
This is a local tax collected by your city or ward. It’s a flat 10% of your taxable income (6% prefectural + 4% municipal), plus a small per-capita levy of around ¥5,000.
Here’s the tricky part: residence tax is based on where you lived on January 1st of the current year and is calculated on last year’s income. So if you arrived in Japan on March 15, 2025, you won’t owe any residence tax until June 2026 — and that bill will be based on your 2025 earnings from March onward.
This also means that if you leave Japan, you’ll still owe residence tax for the year you departed, billed in the following June. Many foreigners are surprised by this.
Do You Need to File a Tax Return (Kakutei Shinkoku)?
Not everyone needs to file. Here’s how to figure out if you do:
You probably DON’T need to file if:
- You work for one employer in Japan
- Your annual salary is under ¥20 million
- Your employer does year-end tax adjustment (nenmatsu chosei / 年末調整) for you
- You have no other income (or other income is under ¥200,000)
You SHOULD file if:
- You have multiple employers or income sources
- You’re self-employed or freelancing
- You earn over ¥20 million annually
- You have medical expenses over ¥100,000 (to claim deductions)
- You left or started a job mid-year and didn’t get a year-end adjustment
- You want to claim deductions your employer didn’t handle (e.g., mortgage, donations via furusato nozei)
- You’re leaving Japan permanently (you must file before departure)
Tax Residency: How It Affects What You Owe
Japan classifies taxpayers into three categories:
- Non-resident: Lived in Japan less than 1 year, no intention to stay. Taxed only on Japan-source income at a flat 20.42%.
- Non-permanent resident: Lived in Japan for 1–5 years without permanent residency. Taxed on Japan-source income and any foreign income remitted to Japan.
- Permanent resident (for tax purposes): Lived in Japan for 5+ years OR hold permanent residency. Taxed on worldwide income.
This classification is important — especially if you have income from investments, rental properties, or work abroad. If you’re a non-permanent resident, foreign income that stays in a foreign bank account is generally not taxed in Japan.
How to File Your Tax Return: Step by Step
When to File
The filing period is February 16 to March 15 each year, for income earned in the previous calendar year (January 1 – December 31). If March 15 falls on a weekend, the deadline extends to the next business day.
What You’ll Need
- Gensen choshu-hyo (源泉徴収票) — Your withholding tax slip from each employer. You should receive this by January.
- My Number card (or My Number notification card + photo ID)
- Bank account details for your refund
- Receipts for medical expenses, insurance premiums, donations, etc.
Three Ways to File
Option 1: Online via e-Tax
The National Tax Agency’s e-Tax system now has partial English support. You’ll need a My Number card and a card reader (or a compatible smartphone). This is the most convenient option if you’re comfortable with the interface.
Option 2: In Person at the Tax Office
Visit your local tax office (zeimusho / 税務署) during the filing period. Many offices set up special filing assistance areas with staff who can help you fill out the forms. Some larger offices have English-speaking staff, but don’t count on it — bring a Japanese-speaking friend if possible.
Option 3: Hire a Tax Accountant (Zeirishi)
A bilingual tax accountant typically charges ¥30,000–¥80,000 for a standard return. This is worth considering if you have complex income (multiple sources, overseas income, capital gains) or if you’re not confident navigating the system in Japanese. Check out resources in your local expat community for recommendations.
Common Deductions Foreigners Often Miss
You could be leaving money on the table if you don’t claim these:
- Medical expense deduction: If total medical expenses exceed ¥100,000 (or 5% of your income if under ¥2 million), you can deduct the excess.
- Social insurance premiums: Usually handled by your employer, but double-check if you changed jobs.
- Life and earthquake insurance premiums: Partial deductions available.
- Furusato nozei (hometown tax donations): Donate to rural municipalities and get the amount deducted (minus ¥2,000) from your taxes, plus receive local specialty gifts. This is essentially a tax-neutral way to get free regional products.
- Spouse deduction: If your spouse earns under a certain threshold, you may qualify.
- Dependent deduction: For dependents in Japan or overseas (with proof of support).
Practical Tips for Stress-Free Tax Filing
- Keep all receipts organized throughout the year. Create a folder (physical or digital) sorted by category: medical, insurance, donations, work expenses. When February rolls around, you’ll thank yourself.
- Get your My Number card early. You’ll need it for e-Tax and many other administrative tasks. Apply at your local city hall — it takes 1-2 months to receive, so don’t wait until tax season.
- Don’t forget about furusato nozei. It’s one of the best tax benefits available to anyone living in Japan. Use sites like furunavi.jp or satofull.jp to find and make donations easily.
- File even if you don’t have to. If your employer did year-end adjustment but you had significant medical expenses or other deductions, filing a return could get you a refund.
- Set up your bank account for direct deposit refunds. Refunds typically take 1-2 months after filing. Make sure your Japanese bank account details are correct on the form.
Residence Tax: What to Expect After Filing
Even after filing your income tax return, you’ll separately receive a residence tax bill around June. How you pay depends on your employment:
- Employees: Residence tax is usually deducted from your paycheck in 12 monthly installments (June through May of the following year). This is called special collection (tokubetsu choshu).
- Self-employed / Freelancers: You’ll receive a bill with 4 payment due dates (June, August, October, January). You can pay at convenience stores, banks, or via PayPay and other mobile payment apps.
If you’re leaving Japan, make sure to either pay your remaining residence tax in full or designate a tax representative (nozei kanrinin) who will handle payments on your behalf.
FAQ
What happens if I miss the March 15 deadline?
You can still file a late return, but you may face a late filing penalty (15-20% of the unpaid tax) and delinquent tax interest (currently around 2.4-8.7% per year). If you’re owed a refund, there’s no penalty for filing late — but you should still file within 5 years.
Do I need to file taxes if I’m on a student visa?
If you’re working part-time, your employer likely withholds income tax. If that’s your only income source and your employer does year-end adjustment, you may not need to file. However, if you have multiple part-time jobs, you should file to ensure the correct amount was withheld.
Can I file taxes in English?
The e-Tax system has some English support, and the NTA publishes English-language guides. However, most forms and the full filing process are in Japanese. Consider using a bilingual tax accountant or asking for help at your local tax office.
I’m leaving Japan permanently. What do I need to do about taxes?
You must file a final tax return before you leave (or appoint a tax representative to file on your behalf). You’ll also need to settle any outstanding residence tax. Your employer should provide your withholding slip early if you inform them of your departure. Check our visa guide for related immigration steps.
What is furusato nozei and should I do it?
Furusato nozei is a donation system where you contribute to local governments across Japan and receive the donation amount as a tax deduction (minus ¥2,000), plus regional gifts like wagyu beef, rice, or fruit. If you pay residence tax in Japan, it’s almost always worth doing. Your deduction limit depends on your income and family situation.
Get Connected with Other Foreigners in Japan
Navigating taxes in a foreign country is easier when you have a community to lean on. Whether you need a tax accountant recommendation or just want to vent about paperwork, connecting with other foreigners in Japan can make all the difference.
Join a Yoriai Base community event to meet other international residents, share tips, and build your support network in Japan.
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