Tax

All persons residing in Japan on the 1st of January are liable for taxation on their earnings in Japan over the following year. In order to prevent tax evasion by individuals making a temporary stay outside of the country before the 1st of January and returning to Japan shortly afterwards, such individuals are considered for tax purposes to have been a continuous resident at their current Japanese address on the 1st of January, regardless of your actual residence. Temporary stays are defined as periods spent outside of Japan of less than 365 days, beginning the day AFTER you leave Japan.

Holders of multi-year visas and re-entry permits should pay particular attention to these details. There have been cases of residents leaving Japan with long periods left on their visas and returning 10-11 months later for holidays or conferences using re-entry permits. This can lead to being classified as a taxable resident for the year in Japan and you will be expected to pay a full year’s worth of income and residency taxes! In this case retention and later use of a reentry permit is considered as evidence of intent to resume residency in Japan. However, if you are able to prove that you do not intend to resume residency in Japan and are only returning temporarily then the tax liability can be cancelled. In order to avoid a time consuming and stressful nuisance please exercise caution in this matter. It is very important for you to notify the City Hall if you are planning to leave Japan permanently.

The following is a statement on the matter from the Kizugawa City Office, Taxation division:

Notice about Prefectural Residency Tax Obligation

 

Under the Local Tax Law, Local Resident Tax is levied against individuals registered as being resident at addresses within Kyoto Prefecture or else registered as having their place of work within Kyoto Prefecture on the 1st of January each year.

 

Regretfully, Kizugawa City is not able to determine tax burden on an individual basis and special cases, such as short term residents in Japan on the 1st of January and long term Japanese residents who left shortly after January 1st. Therefore, in order to apply taxation in a uniform manner, the ‘Tax Imposition of Foreign Residents and those of Equivalent Status’ (外国人(がいこくじん)等(など)に対(たい)する個人(こじん)の住民税(じゅうみんぜい)の取(と)り扱(あつか)いについて) directive is used as a basis to determine liability for Local Residents tax.


For individuals residing abroad on the 1st of January, liability for taxation is determined based upon the length of stay abroad, purpose of trip and personal circumstances. For tax liability purposes, individuals determined to be making temporary stays abroad are reasonably assumed to be residing at their Japan address on the 1st of January as registered prior to their leaving Japan. As Local Residents Tax is determined on a yearly basis, temporary stays abroad are defined as those lasting less than one year (365 days) beginning from the day after the individual left Japan. Unless the individual can demonstrate they are still required to be abroad for longer than one year in total (for example, individuals working abroad but returning to Japan temporarily for a holiday or conference), all periods abroad lasting less than one year will be considered temporary.

 

Kizugawa City Hall, Taxation Division

 

Types of tax

Japanese taxes are divided into two main types: National tax and Local tax. Local tax is further divided into Prefectural tax and Municipal tax. These taxes are calculated separately but both are collected by Kizugawa City. Municipal tax includes Fixed asset tax (charged against the value of land, houses and machinery etc.) which is located within the city, Resident tax, which is charged to all residents of the city and Light Motor Vehicle tax, which is levied against the owners of light motor vehicles and motorbike owners. Payment notices will be dispatched from the Kizugawa City hall and payment is required by 31st of May each year. The amount levied is dependent on the type of vehicle.

 Light Motor Vehicle Tax levels

Type of Vehicle

Levy

Electric Bicyles

Below 50cc

¥1,000

50cc to 90cc

¥1,200

90cc to125cc

¥1,600

Microcar

¥2,500

Light Vehicles

Motorbikes（Above 250cc）

¥2,400

Tricycles

¥3,100

Light 4-wheeled passenger vehicles, business use

¥5,500

Light 4-wheeled vehicles vehicles, personal use

¥7,200

Light 4 wheeled goods vehicle, business use

¥3,000

Light 4 wheeled goods vehicle, personal use

¥4,000

Specialist Snow Vehicles

¥2,400

Small Special Use Vehicles

Agricultural Vehicles

¥1,600

Others

¥4,700

Small 2 Wheeled Vehicles（over 250cc）

¥4,000