Chronicles of Life Abroad in Japan:Residence Tax

life abroad, tax, Japan

Life abroad is fabulous in many ways and it is quite the privilege being able to live in Japan. Taxes are a must wherever you live and work. That is of course the case here as well.

One sneaky tax that can trip up loads of people is the residence tax. It is pretty hefty and it is not always deducted from one’s salary especially if you are an assistant language teacher or a teacher at a language school. Many foreigners in Japan start off doing one of these jobs. It is a whopping 8-10% of your yearly salary after deductions like income tax, health and a few others. It’s a pretty eye popping amount. Japan has a progressive tax system so the more you earn the more you pay.

I think most people are used to taxes being withdrawn from their salary weekly, biweekly or monthly. It is easy to get your pay cheque and be caught out when this tax bill drops in your mail box in late June or early July. It is calculated on what was earned here for the previous year, January to December. Many people start working here in April or September so they will be sent a bill for whatever amount is to be taxed for those months.

Life abroad in Japan comes with this tax hiccup for many. It is something that can easily wipe out a year’s savings if you don’t plan for it.

Since, I am all about budgeting, I budget for this throughout the year so that I have enough money to pay this tax when it pops up.

You may be wondering how someone can be so careless and get caught out with this tax.

For some reason this doesn’t always come up in orientation sessions for people new at their jobs. Whenever I meet someone who has just moved here I bring it to their attention.

Life abroad isn’t all fun and games, there are taxes too and this particular one is annoying. Thankfully it is usually divided into four payments. Also the ward office will work with people to break it up into even smaller amounts. I always feel that I am holding my breath until it shows up, then I breathe easy once I see that my budget for it was accurate.

I  am sharing a little insight into my normal living existence here in Japan. ‘Adulting’ is very much like assuming adult responsibilities everywhere else because taxes must be paid.

 

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28 Comments

  1. Wow! that is high taxes for a foreigner! I find this a great/informative topic for those thinking about living there for however long… I know someone who lived in Japan briefly to teach English, but he never mentioned the taxes… good to know!

    1. It is pricey but everyone who works must pay this, it is what it is. I hope it will help those seeking for this kind of info.

    1. Sigh, you know it but we have to do the responsible thing so we can enjoy things like nice roads and other services.

  2. Wow, that is a big chunk of change, I can see how people get caught off-guard! My husband and I work for ourselves so we always have to budget our taxes in, but that’s not easy to do if it isn’t readily known the tax is coming!

  3. A residence tax?!? Holy cow, that WOULD be a sneaky thing for no one to mention to you, and then have it sneak up on you like that! But I suppose it’s a good way for the government to make money; good thing you are kindly spreading the word with all other non-Japanese who live there that you encounter!

  4. I don’t have any idea regarding for this. But Japan is my dream country that I really want to visit I know It’s kind a expensive but I really want to visit that country <3

  5. Living in Japan sounds so cool, I really want to visit it! Knowing how taxes work and preparing for them is so important, so thank you for sharing with those who need it 🙂

  6. I have tons of family in Japan so i would love to visit one day! However, moving there would be too much. This is awesome information for those who need it! It’s so important to really be prepared for any costs when making such a big move!f

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