The Freelancer’s Guide to Reporting Secondary Income in Japan

Aki Japan Tax Services | Your Income and Corporate Tax Specialists | The Freelancer's Guide to Reporting Secondary Income in Japan

Author Aki Kojima

Certified Public Tax Accountant with an MBA, member of the Association of Micro M&A Professionals, and licensed real estate agent. I provide tax advisory services, asset management consulting, and support for business owners, freelancers, and sole proprietors. I have extensive experience in international sales, accounting, labor relations, recruiting, and IT management. In addition to my professional work, I write articles and books on taxation and financial education. I enjoy swimming, reading, photography, and spending time in nature with my two children.

July 12, 2023

July 12, 2023

Hello, dear readers! If you’re a freelancer in Japan, today’s topic is especially for you. We’re diving into the often misunderstood realm of reporting secondary income for tax purposes. Let’s get started!

The Common Misconception

You might have stumbled upon articles or forums online suggesting that if you’re an employee of a single company, incomes equal to or under 200,000 yen don’t need to be declared. This might sound like a relief, but hold on a minute!

Freelancers, You’re Different!

Unlike regular employees who receive their salary from just one source, freelancers often have multiple income streams. This means that even if you earn a small amount, say 5,000 yen for an interview, it’s essential to declare it. This rule applies even if this income isn’t from your primary freelancing job.

Why the Difference?

The reason behind this distinction is simple. Regular employees don’t need to declare secondary incomes because their primary salary comes from a single source, and their other payments (if any) total up to 200,000 yen or less. However, with their varied income sources, freelancers don’t fall into this category.

A Note on Resident Tax

It’s crucial to remember that the non-declaration rule for regular employees is strictly for income tax. This rule doesn’t extend to resident tax. So, even if you’ve heard otherwise, always declare all your incomes correctly to avoid potential pitfalls.

Conclusion

For freelancers, the bottom line is clear: Declare every income, no matter how small! Staying informed and diligent about your tax obligations will ensure you’re on the right side of the law and can continue your freelancing journey without any hitches.

Remember, always consult with a tax professional or refer to official guidelines when in doubt. Stay informed, stay compliant, and be happy freelancing!

*Note: A YouTube short script inspires this blog post. You can check out our YouTube channel for a visual representation of this topic.*

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