Japan Tax Season: A Complete Guide to Filing Your Kakutei Shinkoku
Filing taxes in Japan doesn't have to be stressful. Learn about Kakutei Shinkoku deadlines, requirements, and how to file your return.
Every year between mid-February and mid-March, residents in Japan undergo the tax season. For expats, determining whether you need to file a tax return (Kakutei Shinkoku - 確定申告) or if your company handles everything can be confusing.
Nenmatsu Chosei vs. Kakutei Shinkoku
Most salaried employees in Japan do not need to file a personal tax return. Instead, their employer runs a Year-End Tax Adjustment (Nenmatsu Chosei - 年末調整) in December, recalculating taxes based on deductions submitted (like life insurance or home loans).
However, you MUST file a Kakutei Shinkoku if you meet any of the following criteria:
- Your total annual salary income exceeds ¥20,000,000.
- You have side income (e.g. freelance, investments, rental income) exceeding ¥200,000.
- You have more than one employer and side salary incomes.
- You left Japan before the year-end adjustment was processed.
Filing for Deductions and Refunds
Even if you are not required to file, you may WANT to file a Kakutei Shinkoku voluntarily to claim refunds. Deductions that cannot be processed during Nenmatsu Chosei include:
- Medical Expenses Deduction (Iryohi Kojo): Reclaim taxes if your family's annual medical payments exceeded ¥100,000 (or 5% of your income if lower).
- First-Year Mortgage Credit: In your first year of home ownership in Japan, you must file a tax return to claim the home loan tax credit (subsequent years are handled at work).
- Furusato Nozei: If you did not use the One-Stop system, or donated to more than 5 municipalities, you must file a tax return to deduct donations.