my 5 years is coming up and i wonder if a PR is worth it because it would mean:
– need to declare and pay taxes on overseas income
– income tax rate is at the highest bracket compared to what I save by having residency to a low tax country
The current business I run is a branch of my overseas company, mostly offering support to local customers but if becoming a PR means I am going to owe Japan a lot more money, is it realistic to continue as a non-resident (even when I stay in Japan throughout the year)?
Really sucks how ridiculous taxation is in Japan and its not even a socialist country like Canada (which I also do not like its high taxes)
1 comment
What do you mean with “it would mean need to declare and pay taxes on overseas income”? Tax residency and Immigration law SOR are completely independent. You need to pay taxes for worldwide income after your 5 years with address in japan, it does not matter if you are special activities, student, business, dependent, spouse, work visa, or PR.
Same with tax rate. Once resident, the brackets are the same for everyone, natives and foreigners with any SOR. It only depends on your aggregated income.
You said “continue as a non-resident”, so you have less than 1 year in japan? If so, you dont qualify to PR anyways.
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AFAIK You tax situation in japan wont change. The decision to get PR or not depends on other factors, not tax residency.