Taxes and Pension

Taxes

JET Programme participants live and work in Japan, and because they are working residents, they are liable to pay Japanese taxes. The specific liabilities for each participant will depend upon his or her status of residence and nationality. What follows is accurate as of January 2006 unless otherwise noted. Country-specific information exists in the General Information Handbook.

The following are excerpts from the JET Programme website’s Taxes page.

Personal Income Tax

Your tax status in Japan depends largely on your nationality, the length of your stay and your occupation in Japan.

For American citizens, the JETs in Kumamoto Prefecture have put together detailed guides on how to complete Federal Tax returns. Visit their website for more information.

First and second year Canadian and New Zealand ALTs, all third year ALTs, and all CIRs and SEAs can continue reading about the tax filing process below.

Tax Exemption Form

Those JET participants eligible for tax exemption in Japan according to the information in the previous section should make sure they fill out forms for tax exemption (examples in the GIH). Your Supervisor will present you with these forms for signing shortly after you arrive.

Local Inhabitants’ Tax

JETs who are liable for income taxes will likely be liable for inhabitant taxes also. Inhabitant taxes are calculated based on the previous year’s income in Japan.

The inhabitant tax bill is delivered around June for the previous January to December’s income. However, even when you are liable for taxes your first year (as are CIRs and SEAs), inhabitant taxes are generally not required in the calendar year in which you arrive. So, if you arrived in July 2006, you will have inhabitant taxes due in 2007.

Contracting organizations payment of your inhabitants tax in one of two ways: they will make monthly deductions to your paycheck or include the money in your salary and require you to pay the bill in June.

It is very important to confirm whether you will be liable for inhabitant taxes. Please clear this up early on, and check on it from year to year to be sure it has not changed.


Pension

As a foreign national, upon giving up residence in Japan you are entitled to a lump-sum withdrawal of your mandatory payments into Japan’s pension system.

Withdrawal Process

Before leaving Japan, fill out and mail the form “Lump-sum Withdrawal Payment Arbitration Bill,” which can be downloaded from the Japan Pension Service website. Make sure to attach a copy of your passport, a certified bank stamp, and your pension book. The mailing address is:

Japan Pension Service

3-5-24 Takaido-nishi

Suginami-ku, Tokyo 168-8505

Japan

Refund

You may also be eligible for a refund on the 20% flat tax on lump-sum withdrawals from the pension fund.

To do this, you must designate a person to file your tax work, do this by filling out the document “Notification of Tax Agent” (nozeo kanrinin no todokesho-gaikokujin-yo) from any tax office and file for the lump-sum withdrawal.

This must be done within 5 years of leaving Japan, and CLAIR does not handle the paperwork for this refund.

Further details are in the “Leaving JET” section of the General Information Handbook as well as the website of the Japan Pension Service

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