Japanese Tax Affairs
The Japanese Income Tax Act establishes the tax classes listed in the following table for individuals and the scope of assessment varies depending on each tax class.
“Residents” refer to individuals who have a domestic address or who continuously live in Japan for one year or longer to date. “Non-residents” refer to individuals other than residents.
| 1.1. Residents | （1）Non-permanent residents | Individuals without Japanese nationality who had an address in Japan and/or lived in Japan for five years or less in total in the past ten years |
|---|---|---|
| （Scope of assessment） | ①Income other than foreign source income and foreign source income paid in Japan ②Money transferred from overseas |
|
| （2）Residents other than non-permanent residents (permanent residents) | Residents other than non-permanent residents | |
| （Scope of assessment） | Individual’s all income including domestic source income and foreign source income | |
| 2.Non-residents | （Scope of assessment） | Domestic source income only |
There are two types of methods of taxation: tax payment by self-assessment and withholding. Which one applies depends on the type of domestic source income and whether your income is from a permanent establishment.
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