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[stumptowny]

[quote="kzjohn"][quote="stumptowny"]teacheratlarge,

brokerage firms outside japan won't send tax docs (1099's) to the japanese government. they will only send documents to the IRS.... in any case, its not taxable for japan. tell your friends asap[/quote]

But won't the IRS send your 1040/2555, where you've declared those US assets, along to Japan's tax people?[/quote]

tax sharing agreements: its for uncle sam to know what you're doing outside the USA, not the other way around. primarily so they can double check your income for the 2555. if you're over 95k a year (or less if you weren't out of the USA for all of the 365 days for the year), bam!

japan doesn't have any need or desire for a 1040 (they already know what you make here). what you make elsewhere is not their concern. would be pathetic to see the japanese fumble with a 1040, 1099/5498's. they would implode "does not compute" and meltdown... but the IRS is not sharing that..

[Vince]

[teacheratlarge]

[stumptowny]

[quote="teacheratlarge"][quote="stumptowny"][quote="kzjohn"][quote="stumptowny"]teacheratlarge,

brokerage firms outside japan won't send tax docs (1099's) to the japanese government. they will only send documents to the IRS.... in any case, its not taxable for japan. tell your friends asap[/quote]

But won't the IRS send your 1040/2555, where you've declared those US assets, along to Japan's tax people?[/quote]

tax sharing agreements: its for uncle sam to know what you're doing outside the USA, not the other way around. primarily so they can double check your income for the 2555. if you're over 95k a year (or less if you weren't out of the USA for all of the 365 days for the year), bam!

japan doesn't have any need or desire for a 1040 (they already know what you make here). what you make elsewhere is not their concern. would be pathetic to see the japanese fumble with a 1040, 1099/5498's. they would implode "does not compute" and meltdown... but the IRS is not sharing that..[/quote]

Unforunately for you, to quote a Dylan song, 'the times they are a changing'
or in this case have already changed. It's probably only a matter of time before you are found. Rental income, off shore bank account interest, brokerage account income; doesn't matter, if you're generating enough income you're supposed to be reporting it.

Don't be a droog, time to wake up and smell the coffee. Here in Japan, bleating
" I didn't know " will not get you much sympathy. How much time you have will depend on who is monitoring your tax returns in your neck of the woods. Sometimes believe it or not, the foreign party will report it, if they are aware that they are supposed to (assuming they know you reside in Japan).[/quote]

what forms do I file with japan for my house and brokerage accounts back home? where do I send these forms in japan? lastly, why would I do that?

I am taxed already for these assets back home and you are saying japan can tax these assets also. it's odd because when I get my tax payments here, they never ask me or any of us if we have any assets outside of japan. they add our income in japan and that's it.. your claims are quite sketchy.... so, tell us all what is required.. thanks

[marley'sghost]

Wow. I've never declared any of my foriegn income on my Japanese income tax. But then it's so meager, that it does not get taxed back home anyways. Sort of depressing.
Be more than a little more depressed to learn that this pittance, while it does not get taxed back home, would get taxed here!
Looks like there are all sorts of credits and deductions and Japan and other countries have all sorts of treaties and things, but it quickly went way over my head. No way I could wade through all that.

[kzjohn]

Japan taxes worldwide income, dividends, capital gains, including property gains, rental income, royalties, etc. Anything that generates money for you.

It does not matter that it is also taxed abroad, no matter how unfair you think that is.

The exchange of tax info between the IRS and Japan is not a one-way street from Japan to the US. It is two-way, and you might even call it an expressway. No warrant or proof of wrong-doing is required--it's just one tax authority to another (an extra-judicial thing).

I go direct to my local tax office and file my "shinkoku" in person with the help of the workers there, and I now know one or two people to ask for who are familiar with brokerage accounts overseas. I also have an excel sheet that I update yearly (besides 1099, etc) that I leave with them that details each and every sale--you need to account for the purchase and sale dates for share sold during the tax year, exchange rates for those dates, value of purchase/sale in yen, and so on. They like to see everything in detail, but on the tax return itself (shinkoku) all trades for a year are totalled (money in vs money out) and your gain/loss is derived from those totals.

The other option is to use a 国税士. They are something like a CPA that is licensed by the gov't. If you have rental property overseas where you'd be declaring expenses vs income, this is probably a "must".

***

Separate from your tax return, but still filed with your Japan tax office, if the value of your accounts plus any other property abroad exceeds 50,000,000 yen (even if there is no income/gains from it), you must declare that to the tax authorities here in Japan--on a yearly basis.

[stumptowny]

I am a resident so I need to report, as you stated, or risk having my wages garnished for non-compliance...

why have i not been found out yet? I am guessing because the new tax sharing pact is just getting started so japan has had no way to see my brokerage account assets until now.

kzjohn.. did they find you? how did you even learn about this?

is the tax rate the same (based from our salary) for taxing foreign income/assets? do you know how the tax rates for the foreign income is calculated? thanks

amazing, no one I know has mentioned or knows this so there are going to be people leaving japan once their wages get garnished if it comes to that...

I imagine japan tax goons will go after the big asset holders first... the low lying, juicy fruit... then us less ripe, small timers...

it is such a sham... and has changed to one of the reasons I may be leaving japan, not staying

[kzjohn]

My info/education on this tax thing mostly came from an extended thread on another forum--the former GaijinPot forum (now closed down).

But that thread--which went to many, many pages (700+ posts)--has been archived here. There are some true horror stories in that thread.

I would urge anyone who thinks they may be able to slink and slide around one or another tax authority to spend the time it will take to read thru all those posts. There is also a followup to that thread on the regular forum over there.

***

One thing that clearly triggers the tax people giving you a look are money transfers. I'm unclear on the amounts, but if you are transferring money from here to there, or there to here, that seems to be one of the signals they're looking for--you are either creating overseas assets that may be throwing off income, or you're repatriating (undeclared) gains from overseas. And please, people, banks are pre-wired to report such transfers to the tax guys--please assume that any transfer you make will be recorded by the tax authorities.

If you happen to be a "quiet" person in terms of money transfers, I suppose you might stay under their radar for a while...?

[stumptowny]

thanks again kz,

so you read the posts in the thread and voluntarily found tax pros to give your money to? or did they find you some how?

also, is the tax rate the same (based from our salary) for taxing foreign income/assets? do you know how the tax rates for the foreign income is calculated?

please pm me if you don't want to share. I'd appreciate it. but i'll be reading lots tonight...

bank transfers.... it really depends on the kind of transfer... and your financial behavior here that cumulatively create a picture. first, its already taxed before entering your account... so there's that. if you had a randomly astronomical amount or suddenly had many large multiple transfers without your income changing (like extremely large), that may raise some red flags. but people saving 3 ,4 , 5, 8 paychecks worth and transferring them together is normal.. this would not be enough to alert anyone because they know people transfer according to exchange rates and.... well, whenever they please. that's life and all legal. if your taxes are paid, they're not going to care much. business is in order.

[rxk22]

Wow! I am potentially inheriting a good deal of money in the future. No way am I paying 20% on top of the US taxes. I also think instead of sending money to myself via bank transfers. I will just hand carry cash, and deposit it when I go home. Just to stay off the radar.

I wonder if trusts are taxable? As technically they aren't income for me.

This is a stupid law. As it totally discourages anyone with any amount of wealth from staying retiring here. Which loses them money in the long run.

[stumptowny]

Imagine... a number of situations you encountered before you ever came to Japan:

- you receive back pay from a grievance

- a settlement from a pending lawsuit (wrongful death, pain and suffering from an accident in which you were partially paralyzed, any financial monies owed you from anything)

- inheritances

- life insurance

- spousal support

- property

on and on...

all taxable by japan even though it has ZERO to do with Japan?!

It's robbery. what's more... we are NOT double taxed on income. But somehow we are taxed on something that has NOTHING to do with Japan????????

on its face, it is so wrong. at least our income is earned here. matters at home HAVE ZERO TO DO WITH JAPAN!

from reading the links provided, it seems the NTA (japanese National Tax Association) is targeting professors and private business owners for audit and subsequent penalty. Not sure about regular low pad minions? NTA is waiting till the 5 year mark in japan to enforce it, then going back retroactively to assess maximum interest and late penalties.

Not sure if the audits are brought on by suspicion of tax evasion (income is not of a common source / money transfers are HUGE) or to anyone unlucky enough to be contacted after reaching the 5 year mark? The tax sharing pact passed last year allows full disclosure of your assets to the NTA from YOUR GOVERNMENT. because of the newness of this accessibility, the implementation is unclear but everything is possible now.

Your choice to bail on Japan if you are audited and it may be the better option...

[kpjf]

It seems to be pretty much the case that people think: Japan is good for a few years, but not a career and the reason several are staying is due to a Japanese partner/wife. But, where in Asia is it good for a career!?

People say Taiwan sucks for teaching English, Thailand has a kind of a reputation for party animals who aren't so serious about teaching (but of course I could be totally wrong on this one), China's the wild wild west. I don't know which country seems to be "good" for a TEFL career

[marley'sghost]

[quote="kzjohn"]
But that thread--which went to many, many pages (700+ posts)--has been archived here. There are some true horror stories in that thread./quote]

Thanks for the link. Some truly informative and terrifying reading there.
I think I'm in the clear...... will do a bit more research though.

[kzjohn]

[Pitarou]