Hi guys! This is very specific, but it turns out the apartment I'm living in has been scheduled to be demolished, so I'm going to be receiving a rather large sum (Probably a bit more than ¥1,500,000) to move into a new apartment/as a hassle payment. I am currently a 個人事業 (sole proprietor) so I file the blue 確定申告 every year, and I wanted to know if anybody knows for certain how the taxes work on this sort of thing.
Looking up online, it seemed like it would be treated as income… which seemed crazy to me since the up front moving costs were only going to be in and out of my account as soon as I move (although I would understand the taxation of the ¥250,000 迷惑料). So I just called my local tax office, but the guy didn't really have the time of day for me when I tried asking.
Despite most of the online articles (in Japanese) looking like it's treated as 収入 (income), he seemed to think that it would be treated as 一時所得 and that I wouldn't be taxed on it. I tried to question further, but he seemed sort of done with the situation.
Doing a bit more research, I discovered this article that seems to think that ¥500,000 of can be left untaxed, but the remaining would be taxed. I don't know the exact numbers, but I'm assuming that means next year I would be facing perhaps another ¥200,000 or so in income taxes/raised health insurance fees, totally eating away at any 迷惑料 I was going to receive (and yes, it's a huge 迷惑 to move… I would totally choose to stay if I could.)
Although we are already in negotiations for the fees, if it's true that I'm going to get a huge jump in taxes next year, I think I need to propose a higher 迷惑料. But I want to make sure that I'm not jumping the gun due to a misunderstanding.
by kailenedanae