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hanna93
September 6th, 2015, 18:51
I'm a first year American JET, and so am exempt from taxes for my first two years that I'll be here. I'm wondering how much taxes would be for me in my 3rd year once I do start paying them though? (per month)

This doesn't seem to be written in any of the guides I've found online. I've looked up formulas calculating this but they all seem to give me numbers that are way too large like ~21,800yen per month (for the 3rd year)?

Can any 3rd year American JET please tell me how much you get taxed per month (if it is consistent throughout the year)? And please let me know if there is a reliable formula I can use to check this?
Thank you!!

BifCarbet
September 6th, 2015, 19:35
You're exempt from American federal (but possibly not state) taxes the whole time. Japanese income tax on the JET salary will be roughly 8 to 10 percent. There will also be inhabitants' tax, which is money. 21,800 per month is not way too large. That's about right, maybe a little low.

No.2260�@�����ł̐ŗ��b�����Łb���Œ� (https://www.nta.go.jp/taxanswer/shotoku/2260.htm) (Japanese Tax Agency website)

Type in the salary at the bottom and the window that pops up will give you the formula. It is taxable income by rate minus scale adjustment equaling your tax paid/owed. I did 3.9M for a 3rd year, and got 352,500, or about 29,300 per month. That's only income tax.

And you should plan for another couple or few hundred thousand yen of inhabitants' tax.

hanna93
September 6th, 2015, 20:02
Thanks for your quick answer!
Oh yes, of course I was just talking about Japanese tax (and we are exempt from American tax the whole time) when I mentioned "tax".

29,300 for income tax per month, I see.. it really is so much, huh!
How much is inhabitant's tax per month or year then for the 3rd year?

Ebi
September 6th, 2015, 20:06
PS - If you need help filing your taxes as an American ALT overseas, I think Kumamoto JETs website is pretty helpful: KumamotoJET (http://kumamotojet.com/U-S--Taxes.php)

BifCarbet
September 6th, 2015, 20:24
Thanks for your quick answer!
Oh yes, of course I was just talking about Japanese tax (and we are exempt from American tax the whole time) when I mentioned "tax".

29,300 for income tax per month, I see.. it really is so much, huh!
How much is inhabitant's tax per month or year then for the 3rd year?

Like Ebi said, you do still need to file, and it's actually more complicated. Also, file your state taxes as well, as you may owe some there. Lastly, 9% is a pretty dang good tax rate, don't feel too bad about it.

Ebi
September 6th, 2015, 21:34
Also, file your state taxes as well, as you may owe some there.
Yet another reason why I love my home state: no state tax to worry about.

Also, this probably doesn't apply to most ALTs, but if you ever have more than the equivalent of $10,000 or more kept in bank accounts overseas, you have to also file a FBAR report. Starting from a few years ago all Americans have to give their SS number when opening a bank account in Japan so the US gov has easier access if they want to audit your funds. The scary thing about FBAR filing is that they don't forgive late penalties and they can take a lot of money as a penalty. Odds are low you'd get audited, but I wouldn't risk it.

uthinkimlost?
September 6th, 2015, 22:27
Yet another reason why I love my home state: no state tax to worry about.

Also, this probably doesn't apply to most ALTs, but if you ever have more than the equivalent of $10,000 or more kept in bank accounts overseas, you have to also file a FBAR report. Starting from a few years ago all Americans have to give their SS number when opening a bank account in Japan so the US gov has easier access if they want to audit your funds. The scary thing about FBAR filing is that they don't forgive late penalties and they can take a lot of money as a penalty. Odds are low you'd get audited, but I wouldn't risk it.

Really? I have had three, none opened with my SS number.

Ebi
September 6th, 2015, 22:36
Did you open them recently though? Maybe it was changed just last year. A few months ago I tried to open a new account and they asked for my SS and they said they needed a copy of my juminhyo for some reason (which I didn't have on me) so I ended up leaving without making an account.

When I asked my PA about it, she said that all the newbies from the US had to give their SS numbers too. Maybe it's just my area then? Or perhaps just certain banks.

uthinkimlost?
September 6th, 2015, 22:58
Pretty sure the new gaijin cards can sub for juminhyo? Same system?

but yeah, within the past 6 months.

BifCarbet
September 7th, 2015, 07:40
The bank does not have to ask you for it. The US government wants it done, but Japanese law doesn't mandate it. Some of our new American ALTs had to, but not all.

mothy
September 7th, 2015, 08:21
The bank does not have to ask you for it. The US government wants it done, but Japanese law doesn't mandate it. Some of our new American ALTs had to, but not all.

Yep, it's not mandatory. But banks that do a lot of business with the US will ask.

Gizmotech
September 7th, 2015, 13:42
I don't even think the volume of business has anything to do with it to be honest. All the americans out here were asked for it and they were doing business with out BFI bank.

I think all the banks are doing it "Just In Case Shit". The junminhyou thing I also heard about out here this year with the new cards that have hand written addys on the back. Not that it's a big deal, as you really should be asking for one when submitting your paperwork at city hall anyways to make life easier.

webstaa
September 9th, 2015, 08:44
Local inhabitants tax is calculated after everything else is deducted as well - which will probably lower the amount when compared to what you think you'll need to pay.

Here (http://www.nic-nagoya.or.jp/en/e/archives/358)'s a pretty good rundown of the tax system and deductions for 2015 (from Nagoya International Center.) After all the deductions from your net income (basic set deductions are around 1,800,000 yen plus (.3 x your annual income)) you'll end up paying a good bit less per year.

richief_611
October 2nd, 2015, 20:45
I'm a first year American JET, and so am exempt from taxes for my first two years that I'll be here. I'm wondering how much taxes would be for me in my 3rd year once I do start paying them though? (per month)

This doesn't seem to be written in any of the guides I've found online. I've looked up formulas calculating this but they all seem to give me numbers that are way too large like ~21,800yen per month (for the 3rd year)?

Can any 3rd year American JET please tell me how much you get taxed per month (if it is consistent throughout the year)? And please let me know if there is a reliable formula I can use to check this?
Thank you!!

No one really answered your question on an exact amount. I was taxed 45,550 yen for inhabitant's tax during my 3rd year in June, which would include my salary from Aug-Dec of the previous year. After that, it goes up a lot. I believe my inhabitant's tax during my 4th year will be between 120,000-150,000 yen in June next year. I'm already saving up.

It shouldn't be any more than 160,000 yen or so, if you're from the U.S. during your 4th or 5th years. I'm hoping less.

I don't think it's consistent, but I'll find out when the time comes. If you dread paying a huge amount of tax, make sure to leave after a 3rd year, b/c you'll have a huge tax burden before you can leave Japan in your 4th or 5th year. And you also don't get any more refund for the pension after a 3rd year too. The benefits of staying a 4th or 5th year as a U.S. JET are gone, in terms of money and salary. So only stay if you really like the job, and/or don't have much debt to pay back at home.

Hope this answers your question.

And if you were talking about Japanese income tax, it's an entire separate tax. It's different from the inhabitant's tax. If you have a good contracting organization, they should automatically take care of it for you. Mine deducts a certain amount of money each month from my paycheck. When December rolls around, they will use that withheld money to pay the Japanese income tax, and you will usually just get the difference back. It's just like the U.S.