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Hello everyone!

Continuing from last week, I will explain what happens to your property tax and tax returns once you are assigned overseas.


3. the procedure for appointing a tax manager
Now that we have clarified who can be a tax manager, we will now explain the procedures for appointing a tax manager.

Please note that the address for income tax (tax office) and property tax (tax department of the local government) is different.

Declaration and Application for Approval

There are two types of documents to be submitted when appointing a tax manager.

Tax Payment Manager Declaration Form (if you reside in the municipality)

Application for Tax Manager Approval (if you reside in a different municipality)

The difference between the two is very simple. If the candidate for tax manager resides in the municipality where the tax is paid, he/she submits the form with the “tax declaration” form. If the candidate resides in a different municipality, an “Application for Approval” is submitted.

Many municipalities use a common form for both the Declaration Form and the Application for Approval.

Both the declaration form and the application for approval form are printed on the same form, and the appropriate one is circled to distinguish between the two.

To avoid any confusion when submitting the form, it is advisable to look at the actual form once and check the contents to be described.

Preparation of documents and where to submit them

As mentioned earlier, to officially determine the tax manager, you must submit either a declaration or an application for approval to the local government.

In this chapter, we will summarize how to obtain the necessary documents, where to submit them, and the deadlines.

How to obtain the documents: Download from the website of the local government

Submission destination: Tax division of the local government

Submission deadline: within 10 days from the date when the need to appoint a tax manager arises.

〇Required documents: Copies of identification documents of the taxpayer and tax manager (driver's license, etc.)

First of all, the declaration form and the application form for approval can be downloaded in PDF format from the website of the relevant local government.

Next, the documents should be submitted to the municipality where the taxpayer (the person who pays taxes) last resided.

Make no mistake, this is not the place where the fixed assets are located, but only the municipality where you reside.

As for the deadline, every municipality has a deadline of “within 10 days from the date when the need to appoint a tax payment administrator arises”.

This is a very confusing expression, but basically it is safe to think of it as “before leaving Japan. (Procedures after departure will be discussed later.)

In addition, when a tax manager is changed or abolished, notification must be made in writing.

All documents related to the application for a tax manager can be easily downloaded from the website of the local government, so it will be easier to get an idea of what you need to do if you actually check the documents first. 

4. if you have real estate income, you must file a tax return
If you will be posted overseas for an extended period of time, many people may wish to rent out their homes to generate income. Normally, those who work overseas for more than one year are recognized as non-residents.

Of course, even if you are a non-resident, if you earn income from assets in Japan (in this case, real estate income), you will be taxed according to Japanese tax law.

If you have real estate income in addition to employment income, you are required to file a self-assessment tax return with the tax office, documenting how much income you earned.

You must calculate your income from January 1 to December 31 every year and complete your tax return by March 15 of the following year.

However, as long as you live abroad, it may be difficult to file your own tax return.

In such cases, a tax agent is appointed for income tax as well as property tax. Please make sure to submit the documents to the tax office, not to the local government, so please make sure that there is no mistake.

Administrator

When a tax payment manager is appointed

The tax manager will handle all tax-related procedures on your behalf. With the exception of filing tax returns, paying taxes, and receiving tax-related notices, you can basically assume that the contents are almost the same as those of a tax payment administrator for property tax.

However, as mentioned above, the preparation of tax return documents on behalf of a tax accountant is the exclusive responsibility of the tax accountant.

If you have real estate income, be sure to ask a licensed tax accountant, not a friend or relative.

If you leave your tax return undeclared, you will later be penalized with a “delinquent tax” or “additional tax for not filing”.

If you report the delay yourself, a delinquent tax will be applied, with a tax rate ranging from 7.3% to 14.6%. On the other hand, the additional tax for nonreporting, which is determined by an investigation by the tax office, can be up to 20% of the total tax due.

Since there is no escape when it comes to the collection of delinquent taxes, please make sure to properly request a tax accountant to avoid such penalties.

Failure to Appoint a Tax Collector by the Time of Departure

If you are required to file a tax return but do not appoint a tax agent before leaving Japan, you will incur huge delinquent taxes.

Of course, it is possible to temporarily return to Japan and file the tax return on your own before the deadline. However, it is not always possible to return to Japan at that time.

If you fail to return to your home country, there is a high possibility that your company in Japan will receive a tax notice or investigation at some point. If this happens, your social credibility will be greatly reduced.

However, since January 1, 2022, the tax office has been able to designate a spouse or relative of the taxpayer as a tax agent.

If this designation is accepted, the recipient becomes a “specified tax manager” and must file future tax returns, etc., on behalf of the taxpayer.

If the matter becomes complicated to this point, it will cause a great deal of inconvenience to family members and relatives.

In order to avoid such a situation, please make sure to notify the tax agent before leaving Japan.

Conclusion
Property taxes are still due even if you are posted abroad. The same is true if you file a tax return for real estate income. Failure to pay property taxes or file a tax return will result in huge delinquent taxes.

If you are unable to return to your country temporarily to complete the procedures yourself, please be sure to appoint a tax agent before you leave.


This was a difficult topic, as in the previous week.

However, it is worth knowing once! That is the Japanese Yamato spirit, you might say.

Please continue to refer to this page if you have any problems with fixed assets or tax returns.


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