Taxable Income in Japan for Non-Permanent Resident

A non-permanent resident is an individual who is not a Japanese national and has resided in Japan for five years or less within the past ten years.

The scope of taxable income in Japan for non-permanent residents includes: (1) income other than foreign-source income (hereinafter referred to as domestic-source income), (2) foreign-source income paid in Japan, and (3) foreign-source income remitted from abroad (hereinafter referred to as remittance taxation). The above items (1 ) to (3) constitute income subject to income tax in Japan.

The meaning of remitted from abroad in (3) includes not only direct remittances but also, for example, cases where rental income from real estate owned overseas is deposited into a Japanese bank account, the import of precious metals into Japan, or the repayment of domestic loans from an overseas bank account.

A case to note is when the credit card payment account is an overseas bank account. If the payment for a credit card used domestically is deducted from an overseas bank account, the amount deducted is also included in the remittance to Japan. This is because it falls under the category of repaying domestic loans or other debts from an overseas bank account. If you have income outside Japan, it falls under the remittance tax mentioned in (3) above, and you may need to consider filing a tax return in Japan.