Step-by-Step Process for Japanese Tax Return Filing
Step 1: Determine Tax Residency
- Count number of days stayed in Japan
- Identify visa type and employment nature
- Decide tax category (non-resident / resident)
Step 2: Identify Taxable Income
Taxable income may include:
- Salary & wages earned in Japan
- Bonuses and allowances
- Overtime and incentives
- Foreign income (for permanent residents)
Step 3: Collect Required Documents
Prepare the following:
- Residence card (Zairyu Card)
- Passport & visa details
- Salary slips
- Gensen Choshu Hyo (Withholding Tax Certificate)
- Bank account details
- My Number (Individual Number)
Step 4: Check Employer Year-End Adjustment
In many cases:
- Employer performs Year-End Adjustment (Nen-matsu Chosei)
- If fully adjusted, filing may not be mandatory
However, filing is required if:
- Multiple income sources exist
- Foreign income needs reporting
- Refund is expected
Step 5: Apply India–Japan DTAA Benefits (If Applicable)
- Avoid double taxation using DTAA
- Salary may be taxable only in Japan
- Claim Foreign Tax Credit (FTC) in Indian ITR
Step 6: Prepare Japanese Tax Return
- Calculate taxable income
- Apply deductions & allowances
- Compute national income tax & local inhabitant tax
Step 7: File Tax Return with Japanese Tax Office
- File Kakutei Shinkoku (Final Tax Return)
- Filing modes:
- Online (e-Tax)
- Physical submission at tax office
Due Date:
👉 15th March of the following year
Step 8: Pay Tax or Claim Refund
- Pay balance tax (if any)
- Refund credited to Japanese bank account
Tax Rates in Japan (Indicative)
| Income Slab | Tax Rate |
|---|---|
| Up to ¥1.95 million | 5% |
| ¥1.95m – ¥3.3m | 10% |
| ¥3.3m – ¥6.95m | 20% |
| Higher slabs | Up to 45% |
(Local inhabitant tax approx. 10% extra)
Documents Required Summary
- Passport & visa
- Residence card
- Salary statements
- Gensen Choshu Hyo
- My Number
- Bank details
Common Mistakes to Avoid
- Ignoring local inhabitant tax
- Wrong residency classification
- Missing foreign income disclosure
- Not claiming DTAA benefits
- Late filing leading to penalties
How Saving Mantra Helps Indian Employees in Japan
Saving Mantra offers India–Japan tax compliance support, including:
- Residency & DTAA analysis
- Japanese tax return filing
- Foreign tax credit advisory for Indian ITR
- Salary structuring for expats
- End-to-end global tax compliance
Frequently Asked Questions (FAQs)
Q1. Is Japanese tax return mandatory for all Indian employees?
Not always. If employer completes year-end adjustment and no other income exists, filing may not be required.
Q2. Can I claim Japanese tax paid in Indian ITR?
Yes, through Foreign Tax Credit (FTC) under DTAA.
Q3. What happens if I miss the Japanese tax return deadline?
Late filing may attract penalties, interest, and loss of refunds.
Q4. Do I need to file tax in both India and Japan?
Yes, depending on Indian residential status, with DTAA relief to avoid double taxation.
Disclaimer
This article is for informational purposes only and does not constitute tax or legal advice. Japanese and Indian tax laws may change. Consult Saving Mantra professionals for personalized compliance.