Tokyo

๐Ÿ’ธ

Taxes and Social Insurance

Sections

Types of Taxes

If you are working in Tokyo, you will be subject to the following taxes:

  1. Income Tax (ๆ‰€ๅพ—็จŽ, Shotokuzei):

    • A national tax levied on your income.
    • Calculated progressively based on your annual taxable income.

  2. Resident Tax (ไฝๆฐ‘็จŽ, Juminzei):

    • A local tax paid to the Tokyo Metropolitan Government and your ward (ๅŒบ, ku).
    • Based on your income from the previous year.
    • Typically amounts to about 10% of your taxable income.

  3. Consumption Tax (ๆถˆ่ฒป็จŽ, Shouhizei):

    • A tax on goods and services, currently set at 10%.
    • This is not directly related to your employment but affects your cost of living.

  4. Other Taxes:

    • If you own property or vehicles, you may also be subject to property tax or automobile tax.

Income Tax Brackets (2023)

Japan uses a progressive tax system for income tax. Below are the brackets for annual taxable income:

| Taxable Income (JPY) | Tax Rate | Deduction (JPY) | |----------------------------|------------|-----------------| | 0 - 1,950,000 | 5% | 0 | | 1,950,001 - 3,300,000 | 10% | 97,500 | | 3,300,001 - 6,950,000 | 20% | 427,500 | | 6,950,001 - 9,000,000 | 23% | 636,000 | | 9,000,001 - 18,000,000 | 33% | 1,536,000 | | 18,000,001 - 40,000,000 | 40% | 2,796,000 | | Over 40,000,000 | 45% | 4,796,000 |

  • Example: If your taxable income is JPY 5,000,000, your tax would be:
    • (5,000,000 ร— 20%) - 427,500 = JPY 572,500.

Resident Tax

  • Resident tax is calculated as 10% of your previous yearโ€™s taxable income.
  • It is typically deducted from your salary in monthly installments starting in June.

How to Pay Taxes

  1. For Employees:

    • Taxes are usually deducted automatically from your salary through a system called Gensen Choshu (ๆบๆณ‰ๅพดๅŽ).
    • Your employer handles the paperwork and payments.

  2. For Freelancers or Self-Employed Individuals:

    • You must file an annual tax return (็ขบๅฎš็”ณๅ‘Š, Kakutei Shinkoku) between February 16 and March 15.
    • File your return at your local Tax Office (็จŽๅ‹™็ฝฒ, Zeimusho).

  3. Tax Office in Tokyo:

2. Social Insurance in Tokyo, Japan

Japan has a robust social insurance system that covers health, pensions, unemployment, and more. Participation is mandatory for all residents, including foreigners.

Categories of Social Insurance

  1. Health Insurance (ๅฅๅบทไฟ้™บ, Kenko Hoken):

    • Covers medical expenses, hospitalization, and prescriptions.
    • Employees typically pay 9-10% of their salary, split equally between the employee and employer.
    • Self-employed individuals must enroll in National Health Insurance (ๅ›ฝๆฐ‘ๅฅๅบทไฟ้™บ, Kokumin Kenko Hoken) and pay premiums based on their income.

  2. Pension Insurance (ๅŽš็”Ÿๅนด้‡‘, Kosei Nenkin):

    • Provides retirement, disability, and survivor benefits.
    • Employees pay 18.3% of their salary, split equally between the employee and employer.
    • Self-employed individuals must enroll in the National Pension (ๅ›ฝๆฐ‘ๅนด้‡‘, Kokumin Nenkin) and pay a flat monthly premium (approx. JPY 17,000 in 2023).

  3. Employment Insurance (้›‡็”จไฟ้™บ, Koyo Hoken):

    • Provides unemployment benefits and job training support.
    • Employees pay 0.6% of their salary, while employers contribute 0.9%.

  4. Long-Term Care Insurance (ไป‹่ญทไฟ้™บ, Kaigo Hoken):

    • Mandatory for residents aged 40 and above.
    • Covers nursing care services.
    • Premiums are deducted from your salary.

How to Register for Social Insurance

  1. For Employees:

    • Your employer will register you for health, pension, and employment insurance.
    • Premiums are deducted directly from your salary.

  2. For Self-Employed Individuals:

    • Register for National Health Insurance and National Pension at your local ward office (ๅŒบๅฝนๆ‰€, Kuyakusho).
    • Bring your Residence Card (ๅœจ็•™ใ‚ซใƒผใƒ‰, Zairyu Card), My Number Card, and proof of income.

  3. Ward Offices in Tokyo:

Estimated Costs for Social Insurance

  • For an employee earning JPY 300,000/month:
    • Health Insurance: ~JPY 15,000 (employee share).
    • Pension Insurance: ~JPY 27,450 (employee share).
    • Employment Insurance: ~JPY 1,800.
    • Total: ~JPY 44,250/month.

3. Procedures and Deadlines

Key Steps for Employees

  1. Ensure your employer registers you for social insurance and deducts taxes correctly.
  2. Confirm your Gensen Choshu-hyo (ๆบๆณ‰ๅพดๅŽ็ฅจ), a year-end tax statement, is provided by your employer in January.

Key Steps for Self-Employed Individuals

  1. Register for National Health Insurance and National Pension at your ward office.
  2. File your annual tax return (็ขบๅฎš็”ณๅ‘Š) at the tax office.

4. Cultural and Local Considerations

  1. Punctuality:

    • Japan places a high value on meeting deadlines. Ensure you file taxes and register for insurance on time.

  2. Language Barrier:

    • Most forms and procedures are in Japanese. Consider hiring a tax accountant (็จŽ็†ๅฃซ, Zeirishi) or using translation services if needed.

  3. My Number System:

    • Japan uses a My Number (ใƒžใ‚คใƒŠใƒณใƒใƒผ) system for tax and social insurance purposes. Keep your My Number Card secure and use it for official procedures.

  4. Employer Responsibility:

    • Japanese employers are generally diligent about handling taxes and social insurance. However, itโ€™s good to double-check your payslips for accuracy.

5. Resources for Assistance

  1. National Tax Agency (NTA):

  2. Tokyo Metropolitan Government:

  3. Ward Offices:

  4. Social Insurance Office:

  5. Helplines:

By following this guide, you should be well-prepared to navigate the tax and social insurance systems in Tokyo. If you need further assistance, donโ€™t hesitate to reach out to the resources listed above.