Our favorite! Tax!
Here is the information provided by CLAIR on this fun, fun matter. If you want the full shebang, check out Page 59 of the General Information Handbook 2015 edition.
CLAIR does not specialise in tax matters. The information here is meant to be used as a rough outline.CLAIR accepts no responsibility for any financial loss incurred or any legal action taken against anyone as aresult of information contained in or omitted from this article. Please confirm the information provided by yourcontracting organisation, regional tax office, and/or home country tax authority regarding taxes, and adhere torelevant laws and regulations.
2.3.1. Tax in Japan 日本(にほん)の税(ぜい)
1) Personal Income Tax 所得税(しょとくぜい)
Your tax status in Japan depends largely on your nationality, the length of your period of stay, and your occupation in Japan. It is important to note that first and second year ALTs from countries which have not concluded tax exemption treaties with Japan (i.e. UK, Canada, Australia, New Zealand, South Africa, Singapore, Turkey, Jamaica, Malaysia, Trinidad and Tobago, Barbados, Kenya, Peru, Mongolia, Austria, Argentina, Fiji, Tonga, Samoa, and Palau), all third year and above ALTs (with the exception of third year Chinese ALTs), and all CIRs and SEAs are liable for tax in Japan.
If paying tax in Japan, it is important to obtain a breakdown of such payments (Statement of Earnings) from your contracting organisation. This statement can take the form of either a gensen chōshū ni kakaru shotokuzei no nōzei shōmei negai （源泉徴収にかかる所得税の納税証明願）or a kyūryō shotoku no gensen chōshūhyō（給料所得の源泉徴収票). If your visa type and nationality exempts you from paying Japanese taxes, the statement may also take the form of a kyūyō shiharai hōkokusho（給与支払報告書）.
Be sure to keep your gensen chōshūhyō（源泉徴収票） or Statement of Earnings. JET participants who have to file tax returns in their home country need this, as do all reappointed JET participants who apply for an extension on their Status of Residence. A Statement of Earnings is also needed when your tax or your Status of Residence changes. Many contracting organisations provide a gensen chōshūhyō in January. The gensen chōshūhyō details your annual income (January-December), tax you pay, and how much you contribute to Social Insurance and Pension. Please confirm details regarding your gensen chōshūhyō with your contracting organisation.
The Tax Exemption Form 免税(めんぜい)書類(しょるい)
Those eligible for tax exemption in Japan should make sure they fill out forms for tax exemption. These can be downloaded from the National Tax Agency website:
Note: Those who are exempt from income tax in Japan are exempt for two years only. From their third year, all JET participants (except those from China) are required to pay tax in Japan.
2) Local Inhabitant Tax 住民税(じゅうみんぜい)
Inhabitant taxes are calculated based on your previous 1 January to 31 December income in Japan, and are levied by the municipality you live in as of 1 January of the current year. Tax can be deducted monthly from your remuneration or you will receive a bill around June for the entire year. However, even when you are liable for taxes in your first year, inhabitant taxes are generally not required in the calendar year in which you arrive. Therefore, if you arrie in July 2015, you will have inhabitant taxes due in 2016.
For JET participants who have taxes in Japan imposed on them, your remuneration of ¥3,360,000 (first-year JET participants who arrived in April 2012 or later) is before income and inhabitant taxes have been paid.
2.3.2. Home Country Tax Liabilities 本国(ほんごく)の納税(のうぜい)義務(ぎむ)
Tax liability in your home country for your Japanese income depends on certain factors including the nationality of the participant as well as the existence and content of a tax treaty between the participant’s home country and Japan. Please be aware that it is the responsibility of each individual JET participant to seek information via his/her home country tax agency regarding tax obligations in his/her home country as well as the necessary procedures. Your supervisor, contracting organisation, PA, and CLAIR are not in a position to provide guidance on your home country tax liability.
Also, here is a useful chart, coloured by yours truly, for leaving JETs for Pension Refund Procedures (脱退(だったい)一時(いちじ)金(きん)還付(かんぷ)の流れ(ながれ)) on Page 165 of the General Information Handbook, 2015 edition.