I am in the process of switching to a new job. I have 2 other opportunities to do some consulting/ branding type work under a 業務委託 contract. So in the end I would have one full time job (semi-remote, go to office 3 times a week) and 2 業務委託 positions (fully remote) that would require about 3 hours of work per day in total. AS a working situation, is this legal? If so, should I start my own "consulting firm" shell company to receive payments for the 2 業務委託 positions? How would I file taxes/ do the year end adjustments in such a situation? Are there any best practices I should consider?
Edit: I have a Japanese wife so my visa and ability to work is ok / unrestricted
by CruisinExotica
2 comments
Whether it’s legal or not depends on the terms of your visa and if you have permission to engage in work outside of your visa.
It’s usually best to do 業務委託 as an individual, so you don’t really need to set up a company unless the amount of profit you’re making is substantial. You don’t do an end of year adjustment on side income as an individual. You file taxes at the start of the following year.
> I have 2 other opportunities to do some consulting/ branding type work under a 業務委託 contract. So in the end I would have one full time job (semi-remote, go to office 3 times a week) and 2 業務委託 positions (fully remote) that would require about 3 hours of work per day in total. AS a working situation, is this legal?
It’s legal (given that your visa permits the work). Your full time job might have work rules that purport to forbid it, but those are only legal to the extent that your side jobs are interfering with your job with them, so you should probably ignore any rules that go beyond that scope. Of course, you should ensure that your side jobs do not actually interfere with your main job, and obey any legitimate restrictions in your work rules such as not working for direct competitors of your main employer.
> If so, should I start my own “consulting firm” shell company to receive payments for the 2 業務委託 positions?
It’s an option but probably not worth the hassle IMO compared to doing this work as an individual (“個人事業”). The tax treatment is different and can be better or worse, but generally not by a huge amount either way.
> How would I file taxes/ do the year end adjustments in such a situation?
You do your year end tax adjustment as normal at your main job, then you file a full tax return (確定申告) that includes both the information from your year end tax adjustment and your side income.
> Are there any best practices I should consider?
Business income generally gets better tax treatment, so you probably want to do this work in such a way that it constitutes business income (there’s a big post about business vs miscellaneous income somewhere on this sub) and register to receive business income and do blue-form tax filing at your local tax office. And there are various things you can sometimes claim as business expenses or otherwise get a tax deduction on (e.g. small business mutual aid).
If you want to hide your side work from your main employer, make sure to opt out of special collection of residence tax on your tax return.