2 Comments

• 

  starkimpossibility

  November 19, 2023 at 6:48 am Reply

  > How should he declare his earnings from from the US company (about USD 10,000 working for over 6 months)?

  In the context of the new employer’s request, there is no way for your friend to declare his overseas income to his new employer. There would also be no purpose for doing so.

  The new employer just wants the withholding summary from any previous Japanese employers so that the new employer can take income paid by previous employers into account when they do a year-end adjustment at the end of the year. However, they can’t take non-employment income into account, nor can they take overseas income into account, so there would be no point telling the new employer about the overseas income.

  If your friend wants to receive a refund of excess withheld tax a little earlier (i.e., at the time of the year-end adjustment instead of the time of filing a tax return), they can provide the withholding summary from their previous Japanese employer to their new employer. If they prefer to keep their previous salary private from their new employer, that is also an option. Either way, your friend’s new employer has no interest whatsoever in your friend’s previous non-employment/overseas income.

  To pay the tax due on your friend’s overseas income, your friend will need to file an income tax return (þó║Õ«Üþö│Õæè) between January 1 and March 15. They will need the annual withholding summaries from all Japanese employers they had during 2023, as well as an accounting of their income and expenses relating to the overseas work.

  Note that amounts in foreign currency will need to be converted to JPY for tax purposes, at the rate applicable to the date on which the foreign currency was received/paid. (There may also be foreign exchange gains to account for, if money was held in foreign currency and later spent or converted to JPY.)

  If your friend needs assistance to file an income tax return, the NTA publishes an English-language guide to filing an income tax return in January each year, plus this subreddit has a tax return questions thread active through February-March. The simplest way to file an income tax return is [online](https://www.keisan.nta.go.jp/kyoutu/ky/sm/top#bsctrl).

  > Will declaring this income cause immigration issues?

  It could, but without knowing anything else about your friend, the risk is very low. As u/kansaikinki said, the NTA doesn’t care about visa restrictions, and there is no automatic information exchange about this kind of thing between the NTA and the ISA.

  The ISA may have questions about the income when it comes time for your friend to renew their visa (assuming it’s evident from the tax certificate your friend provides as part of the renewal), but the “penalty”, if any, is likely to be little more than a request for a written explanation/apology. The ISA doesn’t generally impose strict penalties on people who do a bit of side work, providing that they are still engaging in the activities covered by their visa (work for a Japanese employer).

  The ISA’s primary concern, when it comes to work-visa-holders, is the interests of the Japanese employer. So unless the Japanese employer complains about the side work, the ISA is unlikely to be too concerned.

• 

  kansaikinki

  November 19, 2023 at 6:48 am Reply

  Correct, your friend does not have permission to work for non-Japanese companies on his work visa. He would need PR, a spouse visa, LTR visa, dependent visa, that sort of thing, to be able to work for an non-Japanese company.

  Generally speaking the tax office just wants your taxes to be paid and is not interested in your immigration status. He should declare his income properly and pay the Japanese taxes he owes on work he performed in Japan.

  It is unlikely that immigration will immediately or automatically discover his transgression. Someone who doesn’t like him could report him to immigration (so he should keep his trap shut), or at some future point a more automated reporting system could, in theory, be put in place between the tax office and immigration.