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tax questions: 10% vs. 20% tax rate balancing act

 
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stumptowny



Joined: 29 May 2011
Posts: 239

PostPosted: Mon Jan 14, 2013 4:32 pm    Post subject: tax questions: 10% vs. 20% tax rate balancing act Reply with quote

obviously I want to stay under the 20% tax rate set at 3,300,000 yen per yr. of total income rather than lose roughly $3,500 USD just for breaking this amount.

first, is 3,300,000 gross or net? gross I assume but want to make sure..

next, I have two jobs and want to come as close to this as possible without going over.. I can track my earnings with my pay stubs.
my primary job completes my taxes but my part time job seems shady(er) and I am not even sure if they are reporting my income or completing taxes?? it is not under the table as I do time sheets and they do send pay stubs but they haven't mentioned taxes at all..

how serious should I be watching my income for 2013 to assure I am not over 3,300,000 yen for the year? should I not worry at all? do any of you monitor your income closely for this purpose? any strategies to share?

I would like to work just enough part time to stay under the higher tax rate but if it doesn't matter at all, I would like to work tons of part time for the $$$.

thanks for your ideas and experience!
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Inflames



Joined: 02 Apr 2006
Posts: 416

PostPosted: Mon Jan 14, 2013 5:09 pm    Post subject: Reply with quote

If you earn 3,300,000 yen per year you won't pay 20% - I make a lot more than that and I don't pay 10% (including juuminzei). I go to the tax office and do everything there.
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Glenski



Joined: 15 Jan 2003
Posts: 12844
Location: Hokkaido, JAPAN

PostPosted: Mon Jan 14, 2013 10:40 pm    Post subject: Reply with quote

http://www.japan-guide.com/e/e2206.html
This says income tax is on net income minus a certain exemption.

I think the law says you should report your part-time income to the main company so your correct taxes can be done. My wife says people sometimes don't do that, but it's not right. I know you are trying to avoid a 20% tax bracket, but that's life. You can't have your cake and eat it, too.

Here's more info, including the withholding tax guide for foreigners.
http://www.nta.go.jp/foreign_language/index.htm
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stumptowny



Joined: 29 May 2011
Posts: 239

PostPosted: Tue Jan 15, 2013 1:22 am    Post subject: Reply with quote

Inflames wrote:
If you earn 3,300,000 yen per year you won't pay 20% - I make a lot more than that and I don't pay 10% (including juuminzei). I go to the tax office and do everything there.


how? sounds too good to be true. is your primary job reporting that you earn half your salary or something? what are you doing at the tax office that is giving you below 10% tax bracket privileges while earning more than 3,300,000yen per yr?
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stumptowny



Joined: 29 May 2011
Posts: 239

PostPosted: Tue Jan 15, 2013 1:24 am    Post subject: Reply with quote

Glenski wrote:
http://www.japan-guide.com/e/e2206.html
This says income tax is on net income minus a certain exemption.

I think the law says you should report your part-time income to the main company so your correct taxes can be done. My wife says people sometimes don't do that, but it's not right. I know you are trying to avoid a 20% tax bracket, but that's life. You can't have your cake and eat it, too.

Here's more info, including the withholding tax guide for foreigners.
http://www.nta.go.jp/foreign_language/index.htm


thanks glenski..

well, what you have written means I can have my cake and eat it to. Unless you can tell me this is somehow checked or enforced. your wife says some people don't do that? lol. really.. kinda like japanese not paying nhk for tv hook up? and who knows what else..

if I go to the tax office they would only have record of my primary job's tax info then?

has anyone gotten into trouble for not doing the right thing? excluding fleeting cognitive dissonance with glenski...

for a country as tight as Japan, you'd think they'd have this figured out. thus, risk for those getting fat...
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Inflames



Joined: 02 Apr 2006
Posts: 416

PostPosted: Tue Jan 15, 2013 5:45 pm    Post subject: Reply with quote

stumptowny wrote:
Inflames wrote:
If you earn 3,300,000 yen per year you won't pay 20% - I make a lot more than that and I don't pay 10% (including juuminzei). I go to the tax office and do everything there.


how? sounds too good to be true. is your primary job reporting that you earn half your salary or something? what are you doing at the tax office that is giving you below 10% tax bracket privileges while earning more than 3,300,000yen per yr?

Reading between the lines would rather clearly show you that whoever says 20% is incorrect; 20% of 275,000 (which is 1/12th of 3,300,000) is more than 45,500 (the basic amount without any exemptions).

Feel free to look here:
http://www.nta.go.jp/shiraberu/ippanjoho/pamph/gensen/zeigakuhyo2012/data/01_1.pdf
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hagiwaramai



Joined: 24 May 2010
Posts: 119
Location: Marines Stadium

PostPosted: Wed Jan 16, 2013 1:53 pm    Post subject: Reply with quote

I was interested how much I pay in tax after reading this and checked my pay slip from last month. From my main job I got 300,000 and paid tax of 5000, only 1.66%. BUT, I paid another 45,000 in Kosei Nenkin and Kenko Hoken, bringing it up to about 50,000, and 16.6%. At my last job in England before I came to Japan I was getting 1550 a month and paying 200 in tax and 100 in NI(health and pension), 19.4% overall, so 2.8% more than Japan, which is not that great a difference. The weighting is interesting though, in the UK 2/3 was officially income tax and 1/3 health and pension, and in Japan 1/10 was officially income tax and 9/10 was health and pension. I'm not sure why there should be such a difference.
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