Foreign-Source Dividends & Interest and Japan Taxes

Hello r/JapanFinance,

I'm curious about Japanese taxes in my particular situation. I've done a lot of reading about non-permanent tax residency and remittances, and just want to try to better my knowledge. Here's my situation:

I am a US Taxpayer that is planning on spending just over a year in Japan. This will be using a standard "Temporary Visitor" visa for 3 months and a Designated Activities (Long Stay for sightseeing and recreation) visa for 12 months. (link)

I have the funds to support myself for the year without earning an income in Japan. However, my investments (stocks and bonds) in the US will be generating dividends and interest while I am in Japan. My understanding is that non-permanent tax residents of >= 1 year and <5 years are subject to taxes on the lesser between: remittances and dividends/interest. (i.e., if my dividends are $1,000 and I remitted $500, I would owe Japanese taxes on $500, or if my dividends are $500 and I remitted $1,000, I would again owe Japanese taxes on $500).

I would like to better understand when I would become a "non-resident taxpayer." Is it:

  1. The moment I step into Japan?
  2. The moment I switch to the Designated Activities visa?
  3. The moment I've been in Japan for over a year?

As an aside (but still related question): Are people visiting Japan on the "Temporary Visitor" visa and staying up to 3 months also subject to the same taxation rules? Why or why not?

Thanks for your help! I'm trying to figure out how best to plan for my time there with regards to my US assets.

by Left-Mixture-8390

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