Submit a Kakutei Shinkoku to get your final tax return in Japan

Submit a Kakutei Shinkoku to get your final tax return in Japan

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If you live and work in Japan as a registered self-employed operator, or a freelancer, you will need to submit Kakutei Shinkoku (確定申告) to report the amount of income tax of the net income you earned between January 1 and December 31 each year to the Japanese National Tax Agency. You need to submit the forms sometime between February 16 and March 15 of the following year, and if you pass the due date, you’d likely get a penalty for missing it.

 

Wage earners who have part-time jobs or side incomes will need to submit Kakutei Shinkoku to report the final amount of income tax for the year, and depending on the amount of the extra income, wage earners might have to pay extra money for owing taxes to the government.

 

To help you with this, we’ve compiled a guide on what you need to know about the final tax return process in this feature.

 

What is Kakutei Shinkoku?

 

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Kakutei Shinkoku is a final tax adjustments need to be done by a registered self-employed operator, freelancer, and a wage earner with side incomes to get the final tax return if you overpaid your tax, or the final tax payment need to be done if you underpaid your tax. If you work as a registered self-employed operator or a freelancer, your client will usually deduct Gensen-choshu (源泉徴収), a withholding tax, from your payment, and the rate is 10.21%. The process of Kakutei Shinkoku is a little bit difficult if you’re not familiar with tax reporting, and we strongly suggest hiring a tax accountant who can help you through the whole process.

 

Who is required to do Kakutei Shinkoku?

 

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Not everyone is required to do Kakutei Shinkoku, but if you fall under the following conditions, you must submit Kakutei Shinkoku before March 15 of the following year:

- Those who have not complete the year-end tax adjustment (Nenmatsu-chosei)

- Those who have completed the year-end tax adjustment, but have another source of income other than the salary

- Those who have no income on last year

 

Things you need to prepare when filing Kakutei Shinkoku

 

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These are things you need to prepare when filing Kakutei Shinkoku:

-  Record of withholding income tax (Gensen-choshu Hyo, 源泉徴収票) or salary details from your employer and clients

- Receipts of medical expenses uncovered by the insurance, social insurance premium, life insurance premium, etc.

- Copy of the front page of bank book, or copy of the ATM card (for receiving tax refund, if any)

- Copy of Individual number card, or My Number Notification Card with a Photo I.D. (Residence Card)*

 

*The rule for application with My Number Notification Card might change as the government abolished it earlier this year in May.

 

The two-types of Kakutei Shinkoku

 

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In Japan, there are two filing types for Kakutei Shinkoku: Aoiro-shinkoku (青色申告); the blue tax return, and Shiroiro-shinkoku (白色申告); the white tax return. If you registered your self-employed business as a company, you are obligated to submit your files using Aoiro-shinkoku (blue tax return) if you want special tax deduction, and if you didn’t register your self-employed business as a company, meaning that you work as a freelancer, you are obligated to submit your files using Shiroiro-shinkoku (white tax return). The differences between these filing types are the documents you need to submit together with the forms.

 

Documents you need to submit when filing your tax

 

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These are the documents you need to submit when filing the Aoiro-shinkoku (blue tax return):

- Aoiro-shinkoku form (青色申告決算書)

- Kakutei Shinkoku form B (確定申告書B)

- Balance Sheet and Income Statement

-  Record of withholding income tax (Gensen-choshu Hyo, 源泉徴収票) or salary details from your employer and clients

- Receipts of medical expenses uncovered by the insurance, social insurance premium, life insurance premium, etc.

- Copy of the front page of bank book, or copy of the ATM card (for receiving tax refund, if any)

- Copy of Individual number card, or My Number Notification Card with a Photo I.D. (Residence Card)*

 

*The rule for application with My Number Notification Card might change as the government abolished it earlier this year in May.

 

For Shiroiro-shinkoku (white tax return), you need to submit the following documents:

 

- Kakutei Shinkoku form A or B (確定申告書A or 確定申告書B)

-  Record of withholding income tax (Gensen-choshu Hyo, 源泉徴収票) or salary details from your employer and clients

- Receipts of medical expenses uncovered by the insurance, social insurance premium, life insurance premium, etc.

- Copy of the front page of bank book, or copy of the ATM card (for receiving tax refund, if any)

- Copy of Individual number card, or My Number Notification Card with a Photo I.D. (Residence Card)*

 

*The rule for application with My Number Notification Card might change as the government abolished it earlier this year in May.

 

The differences between Kakutei Shinkoku Form A and B are the amount of items to fill in. Kakutei Shinkoku Form A is much simpler than Kakutei Shinkoku Form B, so we recommend submitting the Kakutei Shinkoku Form A for Shiroiro-shinkoku to ease your burden.

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