Job Discussion Forums

[GK]

I am going to Japan next month and my school suggests me to apply for non-residency status to avoid paying tax home. I called Revenue Canada but the first question they asked was "Are you going to teach abroad?" Then that lady told me to read this & that to make sure I am qualify to apply. It seems like they know I try to escape from paying them in the future.

I wonder how many Canadian teachers did apply for this status? What are the procedures? What if I don't apply for non-res? Do I actually have to file tax return to Canada in Japan? I'm planning to stay in Japan for no more than 2 yrs so should I just forget about this?

Another question is about bringing money to Japan. I was told only to bring ALL my money in cash/traveller's cheques, and credit cards & ATM cards won't work?? I mean I just can't believe when I use the same cards in Hong Kong, UK, Switzerland etc and they tell me it won't work in Japan...

[migo]

I'd be surprised if they don't work either. Travellers cheques are always a good idea though. Cash is always a bad idea, especially for somewhere like Japan where travellers cheques should work most places.

[moshimoshi]

I think that your foreign ATM card will work at the post office ATMs in Japan. My husband and I usually bring very little cash and just withdraw money from the ATM in whichever country we are visiting. It was quite a surprise when I first arrived, alone, with only $10 in cash and couldn't find an ATM that worked here. Finally found a CITIBANK ATM and then a post office ATM, so I was a-okay.

[Mike L.]

[Gordon]

Yes, your ATM will work in post offices as others have said.

Yes, apply for non-residency. You should be out of the country for at least 2 years and a day. This is not official, but nothing is in regards to non-residency. This is done so they can change their mind about your application at any time.
It is not easy to give up your residency, it is about how many ties you have to Canada. Ties are things such as bank accounts, a car, land, furniture, storage, RRSPs, driver's license and yes, a passport. Don't get me started on that last one. You can have some of these ties, just not many of them: 6 I believe is the magic number. But again nothing is official. You can apply before you leave and they will get back to you within 3-6 months time what your status is.

[Willy_In_Japan]

As mentioned, Canadian ATM cards are said to work in Post office ATMs, but I havent tried it. The only place I was able to get money out with my Royal Bank card was the Citi bank in Tokyo.

As for money, too much hassle and charges with Travellers cheques. I know some people dont want to do it, but this is what I did and it worked well. Bring 100,000 Yen in CASH and put it in a money belt and carry it with you at all times. Criminals know that Gaijin have trouble with banking and that many of them stash cash at home, so they have been known to be broken into. Few people get robbed at gunpoint here, and even if you do, you have 20,000 or so yen in your wallet and wont lose everything.

As far as non residency goes, it is definitely worth your while to stay out of the country for at LEAST two years and make sure that you dont come back before then or you WILL be considered a resident for tax purposes. I know of someone who spent a year in Japan and ended up with a nice 5000 dollar tax bill upon coming home. That is almost 50,000 a month, and just a little less than what most people manage to save on a monthly basis here.

I left for Japan at the end of October of 2002. I worked essentially two months in Japan, and had done approximately 8 months of McJob in Canada and earned a whopping 6,000 dollars. I earned another approximately 6,000 dollars in Japan but since I was in Canada for MOST of 2002, I was deemed a resident for that tax year even though I intend to stay out of the country for more than 2 years. I was NOT allowed to claim the GST credit because I was not a resident of Canada even though I had to pay taxes that year, and was NOT allowed to claim a rental tax credit for my apartment in Japan because it was not in Canada. So, I had to pay Canadian taxes, despite not getting any benefit of being a Canadian. I got hit with a nice 1000 dollar tax bill, which was based largely on my Japanese income because I was under the personal exemption before I went to Japan.

You earn approximately 35,000 dollars a year in Japan, and if you have to pay Canadian level taxes on that income, I dont think it is worthwhile especially if you have to pay for your healthcare here and have to deal with high food costs too. Working and living in Japan is ok if you get the benefit of low taxes.

You can apply for non residency, but when I put in my last tax return, i noted that i was living outside of Canada. I think it is worthwhile filling in the form, but not 100 percent necessary. Of course, I have to argue with people who tell me maintaining my drivers license is a smart thing to do so I dont have to take my test again, but I dont want that costing me upwards of 10,000 dollars because I was deemed a resident for tax purposes. As soon as I pay off my credit cards and credit line, they will be closed too. Im determined not to get screwed by Revenue Canada if Im not a resident of Canada.

Willy

[Gordon]

[GK]

Thanks everyone.
I was talking with one friend about my concern the other day and he actually suggested me to put some $$ into my visa card so I would have a credit balance. Then when I arrive Japan I can take $$ out from the visa card at any ATM. That's sounds a bit odd but has anyone done it this way before?

In regards to the non-residency status, something happened and I guess I'll only stay for my one year contract. Anyhow I will just go declare it first... I have no ties except a bank acc't, credit cards & passport. I can't cancel the first two no problem...

[Celeste]

Using your credit card as a debit card is a very sensible way to go. I have had friends do this in the past and they found it to be very convenient and safer than cash.