Throwaway account for obvious reasons.
I just got the notification about my residence tax, and the furusato nozei refund amount doesn’t add up. It looks to me that I’m getting back about 30,000 yen less than the donated amount.
My income from salary/bonus was 22,221,800 yen. Using 22m, I checked the maximum furusato nozei amount with various calculators and got around 630,000 yen from multiple sources:
- https://www.furusato-tax.jp/about/simulation 637,622 yen
- https://furunavi.jp/deduction.aspx 631,000 yen
- https://furusato-nouzei.event.rakuten.co.jp/mypage/deductions/ 630,631 yen
- https://www.furusato-tax.jp/about/easy_simulation 608,300 yen (it gave 553,000yen for 20million, so I added 10% more)
To be on the safe side, I ended up doing 536,000 yen of furusato nozei. Since I have to file tax anyway, I didn’t do the one-stop exemption and used the xml file from the donation site (furusato-tax.jp) to add it to e-Tax.
Situation
- Been in Japan for more than 3 years
- Working for a Japanese company as a regular employee (会社員)
- No RSUs, all compensation is from salary and cash bonus
- Married and living with a dependent spouse (less than 1 million yen income). No kids.
- Not a US taxpayer
Income
- 22,221,800 yen from salary/bonus
- 279,289 yen dividends from US stocks/ETFs with Interactive Brokers (so no Japanese tax was withheld)
- 2,853 yen of interest from the cash in Interactive Brokers (I probably filed it at the wrong category as it should be misc income and not interest income, but it’s a small amount, so shouldn’t matter. Also both of those get taxed at the marginal rate anyway iirc.)
Deductions
- 534,000 yen furusato nozei (donated amount minus 2,000 yen)
- 44,750 yen medical deductions (had 144,750 yen medical expenses in the year)
- 27,929 yen foreign tax credit (the US withholds 10% tax on the dividends)
After adding all of the income to e-Tax, I went to the last page and checked the balance: I was to pay 108,800 yen. Then I added the furusato nozei and checked again: I was to receive a 80,385 yen refund. So the furusato nozei meant a 189,185 yen deduction from my income tax.
(Then I went on to add the foreign tax credit and medical deductions bringing the final refund to 123,476 yen.)
The 189,185 yen was already weird: the 22m yen salary puts me in the marginal tax rate of 40%, so I expected it to be 40% of the furusato nozei amount: 0.4*534,000=213,600 yen. What am I missing here?
Then this month I received the notice from the city hall about my residence tax and it has this line: 寄附金控除(市 189,549円、都126,366円)
This means that from the residence tax I got a deduction of 189,549 + 126,366 = 315,915 yen. Adding this to the earlier 189,185 yen, I’m only getting 505,100 yen which is 28,900 yen short of the refund I expected (furusato nozei amount minus 2,000 yen).
What am I missing here?
[edit] here is the full tax return I filed:
by Unique_Sandwich9137
