16% tax because I’m a foreigner?

Hi all, so when hiring me my company told me there would be an added 16% on my salary because I’m a foreign worker. This is supposedly a tax because I’m a foreign worker in Japan. However, looking at my payslip, nothing of the like is deducted and I earn 16% more than what I should be getting.

Anyone know what this is about?

12 comments
  1. I’ve never heard of this. Is the company providing housing, Visa, additional insurance, or other services?

    Sounds illegal. I mean we joke on here all the time about a gaijin tax when confronting awful businesses, but I don’t think that’s actually a real thing

  2. What’s your status ?

    There is a flat rate income tax for non-residents, but it’s 20.42%, not 16%. It’s the closest thing to a “foreigner tax” that would come to mind (but it’s not linked to your citizenship, rather on your residence, but your company may be mixing both). Never heard of 16%…

  3. Is your company a Japanese company, or are you working for a foreign company through a Professional Employment Organization (PEO)? If through a PEO, then the extra may be due to the PEO’s fee to hire/support you.

  4. Is it because it’s your first year in Japan, and you therefore don’t pay residence tax yet?

    You should really ask your employer to explain what they meant though.

  5. If you earn 16% more it may means that you dont pay some taxes because you are a foreigner

  6. Maybe you are not paying the pension (年金). Ask to your company what is the difference from you to other Japanese employees.

  7. It sounds like they’re not making deductions for something (probably pension) and just leaving to you to sort out. Clarify this with them asap

  8. Are you paying social insurance? The employee portion for that is about 14.5%.
    Either they weren’t going to register you for social insurance or they were trying to pass the employer portion of social insurance on to you. The employer portion is about 16%.

  9. … wait so why would it be a tax if you are getting the money?

    Did you misunderstand and you’re getting 16% more for housing costs?

  10. I felt like this is what your HR said or meant:

    “We don’t auto deduct (health insurance/pension/social security/resident tax etc) from your paycheck, but you need to pay them on your own when its due because you are a foreign worker. That’s why you are getting 16% more.”

    Best to do is either look into your paycheck details to see if you are paying any of the above, or just ask your HR again for details.

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