PwC International Assignment Services Alert

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2015 Tax Reform Proposal and impact on individual taxpayers in Japan [PDF 74KB]
The 2015 tax reform proposal, known as Taiko (“Tax Reform Proposal”), was approved by the ruling parties on December 30, 2014. The proposed tax law changes will be submitted to the Diet during January, 2015 for consideration and are expected to pass without significant changes in March, 2015. This IAS alert focuses on the 2015 proposed tax reforms impacting individual taxpayers in Japan.
Ruling coalition parties proposing the ‘exit tax’ to target wealthy Japanese residents moving abroad [PDF 52KB]
On December 30, 2014, the ruling Liberal Democratic Party and its coalition partner, New Komei Party, agreed on the 2015 Tax Reform Proposal, which includes the introduction of 'exit tax' for certain residents in Japan moving abroad. Such a rule would prevent wealthy individuals moving to a location where taxes are low (or no tax in some situations), where they could sell their financial assets with little or no taxes.
The ‘exit tax’, if passed by the Diet, would become effective from July 1, 2015.
While the new law is aiming to target the wealthy Japanese individuals, the impact on foreign expatriates in Japan will be limited, since residents with the most common types of visas are excluded from the scope of the ‘exit tax’.


Japan Gift and Inheritance Taxation Highlights for Expatriates on Assignment in Japan [PDF 64KB]
It has been more than a year since the 2013 Tax Reform broadened the scope of who would be subject to Japan gift and inheritance taxes. In addition, future changes are fast approaching (effective from January 1, 2015) which will increase the gift/inheritance tax rates and lower the exemption deductions.
These changes have generated much discussion and concern amongst the expatriate community in Japan and has prompted Global Mobility professionals to consider the affects on their expatriates in Japan; particularly the company’s Tax Equalization Policy.
This newsletter provides a high-level overview of the Japanese Gift & Inheritance Tax system, recent tax law changes, and some issues to consider for Global Mobility personnel in regards to their expatriates and global mobility programs in Japan.
2014 tax reform may increase tax burden on company employees [PDF 136KB]
The 2014 tax reform proposal was released by the ruling parties on December 12, 2013. The proposed tax law changes will be discussed at the Cabinet and submitted to the Diet early next year for consideration.


Net Investment Income Tax [PDF 136KB]
The Net Investment Income Tax (NIIT) went into effect on January 1, 2013 as part of the Health Care and Education Reconciliation Act of 2010. The NIIT will impose a 3.8% tax on various types of investment income to individuals, trusts, and estates in excess of certain thresholds. The new tax is also part of the tax payment requirements for 2013 (i.e., estimated tax payments).
Certain residents must start to report overseas assets held at year-end [PDF 213KB]
On March 30, 2012, the Diet approved the 2012 Tax Reform Bill, which included a new annual reporting requirement for tax residents in Japan with overseas assets of more than JPY 50 million in aggregate value. This reporting will start with 2013 year-end assets, and the first report will be due March 17, 2014.
2013 Tax Reform Proposal and impact on individual taxpayers in Japan [PDF 165KB]
The focus of this alert is on the 2013 proposed income tax reforms and their impact on individual taxpayers in Japan.


Latest updates on the Japanese Immigration law [PDF 137KB]
This alert provides a summary of the latest updates on the Japanese Immigration law such as New Points-Based Preferential System and New Residency Management System.
2012 Japan Tax Reform Bill [PDF 131KB]
On March 30, 2012 the Japan Diet approved the 2012 Tax Reform Bill. High-earners can expect to pay more taxes and permanent resident taxpayers with significant offshore assets will be subjected to new disclosure requirements. This disclosure is similar to recent US initiatives, including noncompliance penalties, and will likely impact a number of long-term expatriate residents in Japan.
2011 & 2012 Tax Reforms and Impact on Individual Taxpayers in Japan [PDF 148KB]
On November 30, 2011, the Japan Diet approved the “Amendment to the 2011 Tax Reform Bill” and the “Special Measures to Secure the Financial Resources to Implement the Restoration from the Tohoku Earthquake Bill”. Furthermore, on December 10, 2011, the Japan Tax Commission released their 2012 proposed tax reforms. The focus of this alert is on the aforementioned bills which have been signed into law, and on the 2012 proposed income tax reforms and their impact on individual taxpayers in Japan.


Immigration Newsletter - Flexibility in Visa Application to Ease Foreigners Affected by Recent Disaster
Japan provides further flexibility in accepting visa applications to ease the foreigners affected by the recent Great East Japan Earthquake.
Japanese Tax Rules regarding Charitable Donations
Typically, for individuals to claim a tax deduction for charitable donations on their Japan income tax returns, they would need to attach a qualified certificate from the registered Japan charity. But the good news for employees who participate in their company donation initiatives is that a tax deduction may be obtained even without the issued certificate from the Japan charity if the company obtains authorization from the tax office.


Proposed 2011 Tax Reforms
On December 16, 2010 the Japan Tax Commission released their proposed 2011 tax reforms. The focus of this Alert is on the proposed income tax reforms and other tax issues that affect individual taxpayers in Japan.
Employee Reporting of Foreign Parent Company Equity Awards
In recent weeks, a number of accounts regarding the underreporting of equity income by senior executives at foreign-based companies in Japan have been published in the Japanese press. This newsletter will address the company’s responsibilities in these situations, including how companies may take action to protect their reputations and any potential damage to their global brands.


Japan Announces Revised Immigration Laws, Including Additional Penalties
Revised immigration laws were enacted as of July 15, 2009 with corresponding procedural changes expected within three years by cabinet order. There are benefits introduced in the revised laws but also strict penalties for offenders (including imprisonment and/or deportation for certain offences).