I will show the third example which is the case of employee.
I am from Indonesia and have Indonesian nationality. I live in Japan and work in a Japanese company as an IT engineer. My wife is a Japanese and she is also an employee. I just moved to Japan on January 20, 2018 after I got married. I am renting an apartment with my wife. Although I am an employee and get salary from a Japanese company, I also receive monetary rewards as an individual interpreter in 2018. I did not earn any money in 2018 before I came to Japan.
I received 3,000,000 JPY as a salary in 2018. My employer calculates my tax amount based on the materials which I submit to my employer. Since I also work as an interpreter, I received 800,000 JPY in total as monetary rewards from several Japanese clients in 2018. The expenses to earn the rewards was 300,000 JPY.
Note : These incomes were from January 1, 2018 to December 31, 2018.
The income tax which my employer withheld was 56,100 JPY.
Do I need to submit my final income tax return including the rewards as a individual interpreter?
How can I calculate my taxable income and my tax payment in 2018?
You are a Non-permanent resident. Your taxable income is the amount with respect to their (a) income other than foreign source income, (b) foreign source income paid in Japan and (c) foreign source income paid abroad and remitted to Japan from abroad after you moved to Japan.
As an employee, the taxable income is based on the calendar period. Therefore, your taxable income would be the salary and the monetary rewards as a individual interpreter from January 1, 2018 to December 31, 2018. The both income were (a) income other than foreign source income.
Tax base amount is the total amount from your monetary rewards minus expenses and employment income minus deduction for employment income.
Your taxable income consists of the business income and the employment income. The taxable income for your business is 500,000 JPY (800,000 - 300,000). The taxable income for your salary is 1,920,000 JPY (3,000,000 - 1,080,000).
Note : The taxable income for your salary is automatically calculated as shown in the below table.
Since your salary (Employment income) is 3,000,000 JPY and your deduction for employment income is 1,080,000 JPY, your taxable income for your salary is 1,920,000 JPY (3,000,000 - 1,080,000).
Calculation in your case
Taxable income : 2,420,000 JPY (1,920,000 JPY plus 500,000 JPY)
Note : 500,000 JPY is monetary rewards minus expenses.
Deduction for social insurance premiums : 440,000 JPY
Basic exemption : 380,000 JPY
Tax base amount to multiply by income tax rate : 1,600,000 JPY (2,420,000-440,000-380,000)
Income tax rate in this case : 5%
Tax imposed on the taxable income : 80,000 JPY
Special income tax for reconstruction : 1,680 JPY (80,000 × 0.021)
Note : Amount of the special income tax for reconstruction is 2.1% of tax imposed on the taxable table.
Amount of the income tax and special income tax for reconstruction : 81,680 JPY
Deduction for the withholding income tax and special income tax for reconstruction : 56,100 JPY
Balance of the income tax and special income tax for reconstruction amount : 25,500 JPY (rounding down the fractions less than 100 JPY)
Your tax payment is 25,500 JPY.
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