Japanese income tax depends heavily on whether you are a "resident" or a "non-resident". When you move abroad, work overseas, or come to or return to Japan, this is the first question to answer.
We can help if you
- plan to move abroad and want to know about Japanese tax after you leave
- split your time between Japan and another country
- are going abroad for work or study for around a year
- are about to move to, or return to, Japan
Residents and non-residents
| Category | Who | Taxable income |
|---|---|---|
| Resident (permanent) | People with a domicile in Japan, or who have lived here for a year or more | All income, in Japan and abroad |
| Resident (non-permanent) | Residents without Japanese nationality who have lived in Japan five years or less in the past ten years | Japanese income, plus foreign income paid in or remitted to Japan |
| Non-resident | Everyone else | Japanese-source income only |
How "domicile" is judged
For tax purposes, domicile means the center of your life. It is not decided by your resident registration alone. Where you work, where your family lives, your housing and where your assets are located are all considered together.
The one-year rule
If you leave Japan to work abroad and the job is expected to last one year or more, you are presumed to be a non-resident from the day you leave. If it is expected to last less than a year, you remain a resident while abroad. The same approach applies to study abroad.
If your plans change, your status can change from that point.
Procedures when leaving Japan
- Tax agent (nozei kanrinin): if you will still have Japanese income, such as rent, after you leave, you appoint a tax agent and notify the tax office.
- Final return for the year of departure: if you do not appoint a tax agent, you must file a return for income from January 1 to your departure date before you leave.
- Exit tax: if you hold shares and similar assets worth 100 million yen or more, unrealized gains may be taxed as if you had sold them when you leave. This applies to people who have lived in Japan for more than five of the past ten years (periods on certain visas, such as work visas, are excluded).
How we help
- Understand your situationWe ask about your travel plans, work, family and assets.
- Assess your statusWe tell you whether you are likely to be a resident or non-resident and from when, taking tax treaties into account.
- Handle the paperworkWe prepare tax agent notifications, returns for the year you leave or arrive, and exit tax calculations.
FAQ
If I cancel my resident registration, do I become a non-resident?
Resident registration is only one factor. If your family, home or work base remains in Japan, you may still be treated as a resident.
Can I be a resident of both Japan and another country?
Yes, because each country applies its own rules. In that case, the tie-breaker rules in the tax treaty decide which country you are treated as a resident of.
This page provides general information only. The actual treatment depends on your individual circumstances. Please consult a professional before making decisions.