Taxes for Foreigners in Japan

Foreigners in Japan are obligated to pay income taxes at rates that vary according to the amount of income. There are not any provisions for “foreigners” in the Japanese Income Tax Act. Instead, foreign residents in Japan are classified into two categories namely ”residents (kyojūsha)” and “non-residents (hi-kyojūsha)”.

Foreign “residents” refer to foreigners who hold a fixed Japanese address for more than one year, and they are subsequently classified into either “non-permanent residents (hi-eijūsha)” or “inhabitants other than non-permanent residents (eijūsha)”.

“Non-residents” are foreigners living in Japan who are not “residents”. Those who stay in Japan for less than one year are called “non-residents” whether they have a fixed Japanese address or not.

“Residents” and “non-residents” each follow different scopes, procedures and calculation methods of taxation. Foreigners who entered Japan with working visa are considered to be “residents”, unless they present a contract or other written document stating that the length of their stay in Japan is limited to less than one year.


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