Taxes in Japan in 2026: salary tax and rates for foreigners
For the first five years in Japan, a foreigner's foreign income can stay outside Japanese tax if the money is not brought into the country. A full guide to 2026 taxes: salary with a worked example, social insurance, VAT, business, property, cars, crypto, non-residents and the treaty with Russia that Moscow has partly suspended.
The short answer: in 2026 Japan taxes a resident's salary at 5% to 45% national income tax plus 10% local tax, charges 10% consumption tax (Japan's VAT) and 23.2% corporate tax. In practice, social insurance takes more than income tax from an ordinary salary, and the costliest surprises await owners of capital: inheritance tax of up to 55% and an exit tax.
Tax rates in Japan in 2026: the short version
Japan's top income tax rate is 55.945%, and that is not a typo: on top of the national scale of up to 45%, residents pay 10% local inhabitant tax and a 2.1% special surtax that funds reconstruction after the 2011 earthquake. But the top rate only starts at 40 million yen of taxable income a year, and on an ordinary salary of 6 million yen about 78% stays in the employee's pocket.
Consumption tax (shōhizei), Japan's version of VAT, is 10%, or 8% on food. Corporate tax (hōjinzei) is 23.2% at national level, and with local taxes in Tokyo the top combined rate is 31.5-35.4% of profit. Since 2026 companies also pay a defense surtax, and from 2027 a defense surtax is added to personal income tax too.
In 2026 one US dollar buys roughly 150-160 yen, so 1 million yen is about 6,250-6,700 dollars.
| Tax | 2026 rate | Who pays and on what |
|---|---|---|
| Income tax (shotokuzei) | 5-45% + 2.1% of the tax | Residents on a progressive scale; the 2.1% is the reconstruction surtax (fukkō tokubetsu shotokuzei) |
| Inhabitant tax (jūminzei) | 10% + about 5,000 yen a year | Everyone registered at a Japanese address on 1 January, on the previous year's income |
| Non-resident tax on salary | 20.42% | Non-residents on pay for work done in Japan, with no deductions |
| Dividends and share gains | 20.315% | Residents on listed shares and funds |
| Social insurance | about 14.7% employee + about 15% employer | Pension, health, employment insurance and the child support levy |
| Corporate tax (hōjinzei) | 23.2%; 15% on the first 8 million yen | Companies; the reduced rate applies with capital up to 100 million yen |
| Corporate defense surtax | 4% of corporate tax above 5 million yen | Financial years starting on or after 1 April 2026 |
| Consumption tax (shōhizei) | 10%, food 8% | Businesses with sales above 10 million yen two years earlier |
| Fixed assets tax (kotei shisanzei) | 1.4% + up to 0.3% | Owners of land and buildings, on the assessed value |
| Inheritance and gift tax | 10-55% | Heirs; foreigners on work visas pay only on Japanese assets for 10 of 15 years |
| Exit tax (kokugai tenshutsuji kazei) | 15.315% on unrealized gains | Holders of 100 million yen or more in securities after 5 of 10 years in Japan |
| Departure tax | 3,000 yen | Every departure from 1 July 2026 (previously 1,000 yen) |
National taxes are run by the National Tax Agency (Kokuzeichō), while inhabitant tax, property tax and car tax are collected by prefectures and municipalities.
We will calculate online the tax on your income and show how to pay less legally.
Compare taxes in 146 countries: relocation taxes 2026
Who is a tax resident of Japan
In Japan tax residence can start on day one rather than after 183 days. The law looks at domicile (jūsho), meaning the center of life: a move on an employment contract of a year or longer generally creates domicile on arrival. The second test is actual residence (kyosho) in the country for a year or more.
The law then splits residents into two classes, and for newcomers this is the most valuable detail of the whole system.
| Status | Who | What Japan taxes |
|---|---|---|
| Non-permanent resident (hi-eijū kyojūsha) | A foreign resident who has lived in Japan for 5 years or less out of the last 10 | Japanese income plus foreign income paid in Japan or remitted to Japan |
| Permanent resident (eijū kyojūsha) | Japanese citizens and foreigners with more than 5 years in Japan out of the last 10 | Worldwide income |
| Non-resident (hi-kyojūsha) | No domicile and less than a year of residence | Japanese-source income only |
Do not confuse the terms: a permanent resident here is a tax status, not permanent residence for immigration. After five years in Japan, a foreigner on a work visa becomes a permanent resident for tax purposes even without immigration permanent residence.
How the five-year break works
A non-permanent resident pays tax on foreign income only if it is paid in Japan or remitted to Japan. Dividends and rent abroad that stay in an account outside Japan are not taxed by Japan: five years of near-territorial taxation.
The break has two traps. First, since 2017 gains on securities bought as a non-permanent resident within the last 10 years are taxed in Japan even if nothing is remitted. Second, a transfer from abroad into Japan is treated first as a remittance of that year's foreign income, so living costs in Japan are best paid from savings of earlier years held in a separate account.
The 1 January rule for local tax
Inhabitant tax (jūminzei) is charged by the municipality where one is registered on 1 January, on the previous year's income. There is none in the first year in Japan, and on departure the tax for a year that began with Japanese registration is due in full, even when leaving in February.
The 183-day threshold matters in Japan mainly for short business trips under tax treaties. More detail is in the article tax residency and the 183-day rule.
Japan tax residency rules: when it starts and how to confirm it
Japan has no 183-day rule: you become resident after a year of living in the country, or at once if your address in Japan is the centre of your life. A job contract for a year or longer gives you that address from day one. The tax office does not wait until you master chopsticks: sign a two-year contract and you are resident.
As long as a foreigner has lived in Japan for no more than five of the last ten years, foreign income is taxed only if the money is brought into Japan. After that, all worldwide income is taxed. The rate is 5-45% plus 10% local tax. The calculator below checks your days, work and family.
The law does not stop you from confirming the status on your own. But mistakes cost more: moving foreign money into Japan turns untaxed income into taxable income, and the five-year mark is easy to miss. Murblz support removes these risks: we set your residency date, plan transfers, obtain the residency certificate and apply double tax treaties where they are in force. We guarantee professional work and a transparent process, and in most cases a result on the first filing.
183-day calculator
Tax residency calculator for Japan
Enter your travel dates: the calculator shows whether you are a tax resident of Japan today and at year end, and how many days are left before the threshold.
Counting by dates needs JavaScript. Below are the same rules by country.
What is the income tax in Japan and how much of a salary is left
On an ordinary Japanese salary the biggest deduction is not income tax but social insurance. On a salary of 6 million yen a year, employee contributions take about 881,000 yen and national income tax only about 149,000. The reason is generous deductions, which grew again in 2026.
The income tax (shotokuzei) scale has not changed since 2015. On top of it come 2.1% of the tax (the reconstruction surtax) and the 10% inhabitant tax, which uses a slightly different base.
| Taxable income a year | National rate | With reconstruction surtax and 10% local tax |
|---|---|---|
| up to 1.95 million yen | 5% | 15.105% |
| 1.95-3.3 million yen | 10% | 20.21% |
| 3.3-6.95 million yen | 20% | 30.42% |
| 6.95-9 million yen | 23% | 33.483% |
| 9-18 million yen | 33% | 43.693% |
| 18-40 million yen | 40% | 50.84% |
| over 40 million yen | 45% | 55.945% |
The rate applies to income after deductions. The first is the employment income deduction (kyūyo shotoku kōjo): it is set by formula from the salary, no receipts needed. In 2026 its minimum rose from 650,000 to 690,000 yen, and for 2026 and 2027 a temporary top-up of 50,000 yen takes it to 740,000 yen.
The second is the basic deduction (kiso kōjo). Under the 2026 tax reform, passed by the Diet on 31 March 2026, for 2026 and 2027 it is 1,040,000 yen with total income up to 4.89 million yen, 670,000 yen up to 6.55 million and 620,000 yen up to 23.5 million. Above 25 million yen there is no basic deduction. A salary of up to 1.78 million yen a year is free of income tax. The new amounts take effect on 1 December 2026 and are applied in the employer's December year-end adjustment.
Example: a 6 million yen salary in Tokyo
Assumptions: employed by a Japanese company, under 40, no dependants, 500,000 yen a month with no bonus, Tokyo health insurance rate, contributions for a full year. 6 million yen is roughly 38,000-40,000 dollars.
| Line | Yen a year |
|---|---|
| Salary | 6,000,000 |
| Employment income deduction | - 1,640,000 |
| Employment income after deduction | 4,360,000 |
| Employee social insurance, 14.69% | - 881,400 |
| 2026 basic deduction | - 1,040,000 |
| Taxable income | 2,438,000 |
| Income tax and reconstruction surtax | 149,300 |
| Inhabitant tax, paid in 2027 | about 307,300 |
| Total taxes and contributions | about 1,338,000 |
| Take-home pay | about 4,662,000, or 388,500 a month (77.7%) |
Inhabitant tax is twice the national income tax because its basic deduction stayed at 430,000 yen. Under 2025 rules the income tax in this example would have been 186,100 yen, so the reform saves about 36,800 yen a year.
What changes in 2027
From 1 January 2027 a defense special income tax of 1% of income tax is introduced, while the reconstruction surtax drops from 2.1% to 1.1%. The burden does not rise, but the reconstruction surtax is extended by 10 years.
Very high incomes face a minimum tax: in 2025-2026 it is 22.5% of income above 330 million yen, if the normal calculation gives less. From 2027 the rate rises to 30% and the threshold falls to 165 million yen. The number of payers is expected to grow from about 200 to about 2,000 a year.
How much is social insurance in Japan
Japanese social insurance is split down the middle: the employee pays about 14.7% of salary and the employer roughly the same. From April 2026 a new levy was added, the child and child-rearing support contribution (kodomo kosodate shienkin), 0.23% of salary shared between the two. Employee contributions fully reduce the income tax base.
| Contribution (fiscal year 2026/27) | Employee | Employer | Note |
|---|---|---|---|
| Health insurance (kenkō hoken), Tokyo | 4.925% | 4.925% | Total 9.85% in Tokyo, 10.13% in Osaka, 9.9% national average |
| Long-term care insurance (kaigo hoken) | 0.81% | 0.81% | Ages 40 to 64 only, total 1.62% |
| Employees' pension (kōsei nenkin) | 9.15% | 9.15% | Total 18.3%, base capped at 650,000 yen a month |
| Employment insurance (koyō hoken) | 0.5% | 0.85% | General business, cut by 0.1 point from 1 April 2026 |
| Child support contribution | 0.115% | 0.115% | New from April 2026 |
| Workers' accident insurance (rōsai hoken) | - | by industry | Employer only |
The health rate shown is that of the Japan Health Insurance Association (Kyōkai Kenpo), which covers staff of small and medium-sized businesses; the health insurance societies of large companies often charge less. The pension base cap will be raised in steps from September 2027 to 750,000 yen in 2029.
What the self-employed pay
Sole proprietors and freelancers pay into two separate systems. The national pension (kokumin nenkin) for fiscal 2026/27 is 17,920 yen a month for everyone aged 20 to 59. National health insurance (kokumin kenkō hoken) is set by the municipality from the previous year's income, with a 2026/27 ceiling of 1.13 million yen a year.
Can pension contributions be refunded on leaving
Partly, yes. Foreigners with less than 10 years of pension coverage can apply within two years of leaving for the lump-sum withdrawal payment (dattai ichijikin). A 20.42% tax is withheld from the employees' pension refund, but it can be reclaimed through a tax return if a tax representative (nōzei kanrinin) is appointed before departure.
Japan has social security agreements against double contributions with the United States, Germany, the United Kingdom, Korea and several other countries, but not with Russia or the CIS states.
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The chat will ask about your income and residence and send the estimate.
What are corporate tax and dividend tax in Japan
Since April 2026 Japanese companies pay a new tax earmarked for defense. The special defense corporate tax (bōei tokubetsu hōjinzei) applies to financial years starting on or after 1 April 2026: 4% of corporate tax minus a 5 million yen allowance. Small businesses with corporate tax of up to 5 million yen a year do not pay it.
| Company tax | 2026 rate | Note |
|---|---|---|
| Corporate tax (hōjinzei) | 23.2% | Standard national rate |
| Reduced rate for small businesses | 15% on the first 8 million yen of profit a year | Capital up to 100 million yen; 17% if annual profit exceeds 1 billion yen; for years starting before 31 March 2027 |
| Corporate defense surtax | 4% of (corporate tax - 5 million yen) | Years starting on or after 1 April 2026 |
| Local corporate tax (chihō hōjinzei) | 10.3% of corporate tax | Goes to regional budgets |
| Corporate inhabitant tax (hōjin jūminzei) | 7% of corporate tax (standard), up to 10.4% | Plus 70,000 to 3.8 million yen a year depending on company size |
| Enterprise tax (jigyōzei) | up to 7.48% of profit in Tokyo for small companies | For large companies partly based on value added and capital |
| Combined rate in Tokyo | 31.52% (capital over 100 million yen), up to 35.43% (capital up to 100 million) | For small companies, on profit above 8 million yen |
The paradox: on profit above 8 million yen a small Tokyo company pays more than a large one, because its enterprise tax is based entirely on profit. The small-business advantage lies in the first 8 million yen.
How to set up a Japanese company is covered on the page company registration in Japan, and its bank account on business bank account in Japan.
How much tax on dividends in Japan
For a resident private investor, dividends on listed Japanese shares are taxed at 20.315%: 15.315% national tax including the reconstruction surtax plus 5% local tax. The broker withholds it. The same rate applies to gains on shares and fund units.
Dividends from a private, unlisted company suffer 20.42% withholding, and the income then goes into the general return at progressive rates with a dividend credit. For an owner with a high salary, dividends are not always the cheaper route: the final rate can exceed 20.42%.
A Japanese company holding more than a third of another Japanese company pays no tax on its dividends, and dividends from a foreign subsidiary held at 25% or more for at least six months are 95% exempt.
Residents can open a NISA account (Nippon Individual Savings Account), an investment account free of tax on dividends and gains: up to 3.6 million yen of contributions a year and 18 million yen over a lifetime.
What is VAT in Japan: consumption tax and thresholds
Japan's VAT is one of the lowest among rich countries: consumption tax (shōhizei) is 10%, and 8% on food. For comparison, Russia's VAT is 22% from 2026. On 30 July 2026 Prime Minister Sanae Takaichi announced a plan to cut the tax on food to 1% for two years from April 2027. For now it is only a plan: on 15 September 2026 the cabinet approved it as part of a tax reform, and the bill goes to the extraordinary Diet session opening on 5 October.
| What is taxed | Rate | Breakdown |
|---|---|---|
| Most goods and services | 10% | 7.8% national + 2.2% local |
| Food and non-alcoholic drinks, including takeaway, newspapers by subscription | 8% | 6.24% + 1.76%; restaurant meals and alcohol at 10% |
| Exports of goods and services to foreign customers | 0% | With a right to recover input tax |
| Residential rent, insured medical care, school tuition | exempt | No right to recover input tax |
What turnover triggers consumption tax
The threshold is 10 million yen of taxable sales in the base period, that is, two years earlier. A second test looks at the first six months of the previous year: if both sales and salaries paid in that period exceeded 10 million yen, registration comes sooner. A new company with capital under 10 million yen is usually exempt for two years.
In practice the threshold no longer decides much. Since 1 October 2023 Japan has run the qualified invoice system: a buyer can deduct input tax only on invoices from registered sellers. So freelancers working with Japanese companies often register voluntarily even with turnover below 10 million yen.
For them there is a transitional relief: paying 20% of output tax regardless of purchases, for tax periods up to the one that includes 30 September 2026. Under the 2026 reform, sole proprietors will be able to pay 30% in 2027 and 2028.
Tax-free shopping for tourists in 2026
From 1 November 2026 tax-free shopping changes: the tourist pays the full price including tax, and the money is refunded after customs confirms on departure that the goods are leaving Japan. The minimum purchase is 5,000 yen before tax in one shop on one day. Sealed bags and the 500,000 yen cap on consumables are being abolished.
From 1 July 2026 the departure tax, the international tourist tax (kokusai kankō ryokakuzei), rose from 1,000 to 3,000 yen per departure. It is included in the ticket and paid by tourists and residents alike.
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Are there special regimes in Japan for sole proprietors, freelancers and IT
Japan has no turnover-based simplified tax, no patent regime and no reduced rate for IT. Sole proprietors and freelancers pay the same progressive 5-45% income tax as employees, plus the 10% inhabitant tax. Savings come from deductions and bookkeeping, not from a special regime.
| Situation | What is paid | What lowers the bill |
|---|---|---|
| Sole proprietor or freelancer (kojin jigyōnushi) | Income tax 5-45% + 10% local + social insurance | Business expenses, blue return deduction of up to 650,000 yen |
| Sole proprietor in one of 70 listed businesses | Also individual enterprise tax (kojin jigyōzei) of 3-5% | 2.9 million yen annual allowance |
| Small business with turnover up to 10 million yen | No consumption tax | Japanese clients often need an invoice, which means registering |
| Own company: joint-stock company (kabushiki kaisha) or limited liability company (gōdō kaisha) | 15% on the first 8 million yen of profit + local taxes | The director's salary reduces profit but is taxed in the director's hands |
| Non-permanent resident in the first 5 years | Tax on foreign income only when remitted to Japan | Keep foreign income outside Japan |
| Digital nomad on a visa of up to 6 months | Usually non-resident: tax only on Japanese income | Treaty exemption for stays of up to 183 days |
The blue return: the main tool for sole proprietors
The blue return (aoiro shinkoku) is a regime for sole proprietors who keep full double-entry books. It gives a special deduction: 650,000 yen when filing through the e-Tax system or keeping electronic books, 550,000 yen for paper filing and 100,000 yen with simplified bookkeeping. Losses can be carried forward three years. The application is due by 15 March of the year the regime should start, or within two months of starting a new business.
Individual enterprise tax does not hit everyone: consulting and design are on the list, literary and artistic work is not. For most listed professions the rate is 5% on income above 2.9 million yen a year.
Nomads, startups and IT
The digital nomad visa allows up to six months in the country, and in that time tax residence generally does not arise. But citizens of Russia, Belarus, Kazakhstan, Ukraine and other countries without visa-free entry to Japan cannot use it. Details are on the page digital nomad visa for Japan. A second passport from a country on Japan's list lets you apply with it; without one, the nomad visa matcher shows the open options.
The startup visa comes with no tax holiday: the company and the founder pay ordinary taxes. How the program works is on the page Japan startup visa. There is no reduced rate for IT, but the 2026 reform introduced a 40% tax credit for research spending on strategic technologies such as artificial intelligence and quantum computing.
The closest thing to an expat regime is non-permanent resident status: the rates are the same, but foreign income not brought into Japan is untaxed for the first five years.
Property, car, inheritance and crypto taxes in Japan
The most unpleasant number in Japanese tax law for wealthy families is 55%: the top rate of inheritance and gift tax (sōzokuzei and zōyozei), which after 10 years of living in Japan reaches assets worldwide. Taxes on owning property and cars, by contrast, are moderate.
Property tax in Japan
Whoever owns land or a building on 1 January pays fixed assets tax (kotei shisanzei): 1.4% of the assessed value, which is usually below market price. In cities a city planning tax (toshi keikakuzei) of up to 0.3% is added. Residential land of up to 200 m² per home is taxed on 1/6 of its assessed value.
On purchase there is real estate acquisition tax (fudōsan shutokuzei): 4%, but 3% for land and housing until 31 March 2027, with the base for residential land halved. Registration and license tax (tōroku menkyozei) runs from 0.1% to 2% of the assessed value. Buying an apartment to let is covered on the page investment property in Japan.
Gains on a sale are taxed at 20.315% if the property had been owned for more than 5 years on 1 January of the year of sale, otherwise at 39.63%; selling one's own home comes with a 30 million yen deduction. Rental income is taxed on the general scale.
Car tax in Japan and old cars
The annual automobile tax (jidōshazei) is paid in May and depends on engine size:
| Engine size | Tax a year, yen (registered from 1 October 2019) | Registered before October 2019 |
|---|---|---|
| up to 1,000 cc | 25,000 | 29,500 |
| 1,000-1,500 cc | 30,500 | 34,500 |
| 1,500-2,000 cc | 36,000 | 39,500 |
| 2,000-2,500 cc | 43,500 | 45,000 |
| 2,500-3,000 cc | 50,000 | 51,000 |
| 3,000 cc and above | 57,000 to 110,000 | 58,000 to 111,000 |
Petrol cars older than 13 years and diesels older than 11 years pay about 15% more. Hybrids and electric cars are spared this surcharge. The motor vehicle tonnage tax (jidōsha jūryōzei), paid at the mandatory roadworthiness inspection (shaken), is also higher for cars older than 13 and 18 years.
On the plus side, from 1 April 2026 the environmental performance levy on buying a car (kankyō seinō wari), up to 3% of the price, was abolished, and the provisional gasoline surcharge of 25.1 yen per liter ended on 31 December 2025.
Inheritance and gifts
Inheritance tax runs from 10% to 55%, with a tax-free allowance of 30 million yen plus 6 million yen per statutory heir. Gift tax uses the same rates with an annual allowance of 1.1 million yen per recipient. If a foreigner lives in Japan on a work, study or other visa from the first schedule of the immigration law, their foreign assets passing to foreign heirs who have lived in Japan for no more than 10 of the last 15 years or live abroad are not taxed by Japan. Since 2021 it no longer matters how long the deceased with such a visa lived in Japan. Permanent residence or a spouse-of-a-Japanese-national visa removes this protection from day one.
Crypto tax in Japan
Crypto gains currently count as miscellaneous income (zatsu shotoku) and are taxed on the general scale, up to 55% including local tax. On 15 July 2026 the Diet moved crypto assets under the financial instruments law, and once the amendments take effect, sales through licensed Japanese exchanges are planned to be taxed at 20.315%. This is not expected before 2028, and foreign exchanges and decentralized services will stay on the general scale.
Exit tax when leaving Japan
The exit tax (kokugai tenshutsuji kazei) is 15.315% on unrealized gains on securities and derivatives, as if they were sold on the day of departure. It applies to holders of such assets worth 100 million yen or more who have lived in Japan for more than 5 of the last 10 years. Years on first-schedule visas (work, business, study) do not count, so the tax mainly affects Japanese nationals and foreigners with permanent residence. Payment can be deferred for 5 to 10 years by appointing a tax representative before departure and providing security.
What non-residents pay and whether the treaty with Russia works
A non-resident pays tax in Japan only on Japanese income, but at a flat rate and with no deductions. The key number is 20.42%: 20% tax plus 2.1% of that amount for reconstruction. The payer withholds it.
| Non-resident's Japanese income | Withholding tax |
|---|---|
| Salary for work in Japan; if a foreign employer pays, through a tax return | 20.42% |
| Director's fees from a Japanese company, even when working from abroad | 20.42% |
| Dividends on listed shares | 15.315% |
| Dividends from other companies, royalties | 20.42% |
| Interest on bank deposits | 15.315% |
| Rent from Japanese property (except an individual renting a home for personal use) | 20.42% of the rent |
| Sale of Japanese property (except an individual buying a home for personal use for up to 100 million yen) | 10.21% of the price |
A tax treaty can lower the rates on dividends, interest and royalties.
If dealings with the Japanese tax office continue after departure, such as rent, a sale or a pension refund, a tax representative (nōzei kanrinin) with a Japanese address is appointed before leaving.
Does Japan have a double tax treaty with Russia
Yes, but since August 2023 most of it has not worked. The convention between the governments of Japan and Russia was signed on 7 September 2017 and entered into force on 10 October 2018. It offered generous rates: dividends at 5% with a stake of at least 15% held for 365 days, 10% otherwise and 15% where the company's value comes mainly from real estate; interest and royalties generally at 0%.
On 8 August 2023, by presidential decree No. 585, Russia unilaterally suspended articles 5-21, 23 and 26 of the convention and paragraphs 1-3 of its protocol. That covers almost every rule on profits, dividends, interest, royalties, salaries and pensions. The Japanese government lodged a protest and called the move unjustified. Article 22 on the elimination of double taxation formally remains in force, but without the other articles its application to a given income needs checking.
The bottom line: treaty rates cannot be built into payments between Japan and Russia today; calculations have to use each country's domestic rates.
Japan's treaties with CIS countries and neighbors
With other post-Soviet states the picture is better: in 2025-2026 the Soviet treaty of 1986 was replaced by new agreements with Ukraine, Armenia, Turkmenistan and Kyrgyzstan. Status according to the list of Japan's Ministry of Finance:
| Country | Treaty with Japan | Status |
|---|---|---|
| Russia | 2017 convention, in force from 10.10.2018 | Key articles suspended by Russia since 2023 |
| Kazakhstan | 2008 convention, in force from 30.12.2009 | In force |
| Uzbekistan | 2019 convention, in force from 17.10.2020 | In force |
| Ukraine | New convention of 19.02.2024, in force from 01.08.2025 | In force |
| Kyrgyzstan | New agreement of 19.12.2025, in force from 26.07.2026 | Entered into force in 2026 |
| Armenia | New convention of 26.12.2024, in force from 20.12.2025 | In force |
| Georgia | 2021 convention, in force from 23.07.2021 | In force |
| Azerbaijan | 2022 convention, in force from 04.08.2023 | In force |
| Turkmenistan | New convention of 16.12.2024, in force from 27.11.2025 | In force |
| Belarus, Tajikistan, Moldova | Soviet convention of 1986 | Still applied |
To get a reduced rate at source, the treaty application form (sozei jōyaku ni kansuru todokedesho) and proof of residence go to the Japanese withholding agent before payment. Otherwise the domestic rate is withheld and the difference is reclaimed through a refund application.
Let us check where you pay tax
Three questions in the chat show where you are tax resident.
When to file a tax return in Japan and what the penalties are
Most employees in Japan never file a tax return: the employer recalculates their tax in December. This year-end adjustment (nenmatsu chōsei) closes the year for anyone with one job, a salary of up to 20 million yen and hardly any other income. Sole proprietors, freelancers, landlords and those with foreign income need an annual final return (kakutei shinkoku).
| What | Deadline |
|---|---|
| Annual income tax return for 2026 | 16 February to 15 March 2027 |
| Payment of 2026 income tax | by 15 March 2027 |
| Sole proprietor's consumption tax return for 2026 | by 31 March 2027 |
| Company corporate tax and consumption tax returns | 2 months after the financial year ends |
| Inhabitant tax | withheld from salary from June, or four installments on notice |
| Leaving Japan | a return before departure (jun-kakutei shinkoku) or a tax representative |
Returns are filed online through e-Tax with a My Number card (the personal number for tax and social security) or on paper at the tax office; the forms are in Japanese.
Tax penalties in Japan
| Violation | Penalty tax |
|---|---|
| Under-reporting (kashō shinkoku kasanzei) | 10%, 15% on large shortfalls |
| Failure to file (mushinkoku kasanzei) | 15-30% depending on the amount; 5% if filed before notice of an audit |
| Concealment or falsification (jū kasanzei) | 35% for under-reporting, 40% for failure to file |
| Late payment (entaizei) in 2026 | 2.8% a year for the first 2 months, then 9.1% a year |
The Japanese tax authority receives data on foreign accounts through the automatic exchange of financial information (CRS, Common Reporting Standard) with most of the world's financial centers. Permanent residents with foreign assets worth more than 50 million yen on 31 December must file a foreign assets report (kokugai zaisan chōsho), and those with income above 20 million yen and assets of 300 million yen or more also file a statement of assets and liabilities.
Non-permanent residents are exempt from the foreign assets report, but their break on foreign income only works if the flow of money is documented: the tax office can ask where every transfer into Japan came from.
What Japanese taxes mean for a move
Japan's tax system is gentle on middle incomes and harsh on large ones: on a 6 million yen salary about 78% is take-home, while the 55.945% rate starts at taxable income above 40 million yen. For some, Japan is cheaper than it looks; for others, it is one of the most expensive countries in the world.
Who Japanese taxes suit
Salaried specialists on middle incomes. Deductions grew in 2026, there is no inhabitant tax in the first year, and contributions buy health insurance under which the patient pays 30% of the cost of treatment.
Newcomers with foreign capital staying up to five years. Foreign income not brought into Japan is untaxed, and foreign assets are shielded from Japanese inheritance tax for 10 of 15 years.
Small businesses starting out. 15% corporate tax on the first 8 million yen and two years without consumption tax for a new company with capital under 10 million yen.
Who should do the math twice
High earners. From 18 million yen of taxable income the marginal rate is already 50.84%, and from 2027 the minimum tax rises for incomes from 165 million yen.
Those planning to stay more than five years. After the fifth year out of ten, worldwide income is taxed; after the tenth year out of fifteen, all assets fall under inheritance tax of up to 55%.
Crypto investors. Until the switch to 20.315%, gains are taxed on a scale of up to 55%.
Anyone keeping income from Russia. The treaty's reduced rates do not apply, so Russia withholds at its non-resident rates, and Japan credits that tax only up to the Japanese tax on the same income.
What to do before moving
Document with bank statements the savings built up before the move, as this matters for the remittance rule. Decide where investments will sit before becoming resident. And remember 1 January: arriving or leaving around New Year changes a whole year of inhabitant tax.
Related pages: all Japan programs, personal bank account in Japan, taxes by country, company formation abroad and Murblz legal support.
The final burden depends on residence status, sources of income and where assets are held. Murblz specialists will review your situation in a free consultation.
FAQ
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Services
Murblz services in Japan
The tax rate is only half the picture. The other half is where the company sits, where the money is held and who files the accounts. Murblz specialists help with that in the same country. The quote is fixed in writing before work starts.
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