Tax Atlas

Japan: tax residency, rates & nomad visa

Last verified September 26, 2026 by Henning Stanger, Authorized Accountant (Autorisert regnskapsfører) · 16 verified facts · 18 sources

TL;DR

  • 55.945% (as of 2015)Ministry of Finance Japan (Learning More About Taxes, June 2024)“For income from 2015, a new tax rate of 45% was created for taxable income exceeding 40 million yen to revive income redistribution function of the tax system.”View source · accessed 2026-09-26 — The top combined marginal rate on ordinary income is 55.945%: 45% national income tax on taxable income above JPY 40 million, plus the 2.1% reconstruction surtax on that tax (45% x 1.021 = 45.945%), plus the flat 10% local inhabitant tax.
  • Designated Activities (Digital Nomad) (as of 2024)Immigration Services Agency of Japan“Annual income of an applicant must be at least 10 million yen at the time of application.”View source · accessed 2026-09-26 — Japan's digital nomad status (Designated Activities) allows remote work for foreign employers or clients for up to six months with no extension, for nationals of listed visa-exempt treaty countries earning at least JPY 10 million a year and holding private medical insurance covering at least JPY 10 million.

Tax residency rules in Japan

A resident who is not a Japanese national and has lived in Japan for five years or less in the preceding ten years is a non-permanent resident, taxed on Japan-source income and on foreign-source income only to the extent it is paid in or remitted to Japan. Salary for work performed in Japan stays Japan-source even when it is paid abroad. [source]PwC Worldwide Tax Summaries“A resident taxpayer who is not a Japanese national and whose aggregate stay in Japan is five years or less within the preceding ten years”View source · accessed 2026-09-26

Temporary absence rule
A person who owns a residence in Japan and leaves only temporarily, intending to come back, is treated as still residing in Japan during the absence. The intent to return is presumed when family remain in the Japanese household, a residence is kept for after the return, or daily-use belongings stay in Japan. [source]National Tax Agency Japan (2025 Income Tax Guide)“If a person who owns a residence in Japan leaves Japan with the intent to be absent temporarily and later reenter Japan, the person shall be treated as having been residing in Japan during the period of absence.”View source · accessed 2026-09-26
Tax year period
1 January to 31 December (as of 2026)PwC Worldwide Tax Summaries“The Japanese individual income tax year runs from 1 January to 31 December.”View source · accessed 2026-09-26 — The individual income tax year is the calendar year, and the national return is due by 15 March of the following year. Returns are filed individually, as joint returns are not permitted.
Residency test
Japanese tax residence depends on having a domicile (jusho) in Japan or a residence (kyosho) held continuously for one year or more, not on counting days, so there is no 183-day residence threshold. Someone who arrives to take up an occupation that normally requires living in Japan for a year or more is presumed to have a domicile from arrival. [source]National Tax Agency Japan (2025 Income Tax Guide)“Any individual who has a “JUSHO (domicile)” or owns a “KYOSHO (residence)” continuously for one year or more is classified as a resident.”View source · accessed 2026-09-26

Income tax rates in Japan

As of 2015, the headline personal income tax rate in Japan is 55.945%Ministry of Finance Japan (Learning More About Taxes, June 2024)“For income from 2015, a new tax rate of 45% was created for taxable income exceeding 40 million yen to revive income redistribution function of the tax system.”View source · accessed 2026-09-26. The top combined marginal rate on ordinary income is 55.945%: 45% national income tax on taxable income above JPY 40 million, plus the 2.1% reconstruction surtax on that tax (45% x 1.021 = 45.945%), plus the flat 10% local inhabitant tax. From 2027 the surtax is split into 1.1% reconstruction and a new 1% defense surtax, which leaves the combined rate unchanged.

Pit income brackets
5–45% (as of 2015)PwC Worldwide Tax Summaries“The tax liability is determined by multiplying the excess taxable income for each bracket by the percentage above and adding the cumulative tax figure”View source · accessed 2026-09-26 — National income tax is charged in seven progressive bands from 5% to 45% of taxable income. The 2.1% reconstruction surtax is added to the national tax amount, and the flat 10% local inhabitant tax is charged on top based on the prior year's income.
Local inhabitant tax
10% (as of 2026)PwC Worldwide Tax Summaries“Japanese local governments (prefectural and municipal governments) levy local inhabitant’s tax on a taxpayer’s prior year income.”View source · accessed 2026-09-26 — Prefectural (4%) and municipal (6%) inhabitant taxes add a flat 10% on the prior year's income and are imposed on people with a domicile in Japan on 1 January, so the tax runs one year behind the income. Small fixed per-capita amounts and a JPY 1,000 forest environment tax are also charged.
Capital gains and dividends
20.315% (as of 2026)PwC Worldwide Tax Summaries“Capital gains from sales of certain securities (including shares and equity interest in corporations, warrant bonds, etc.) are taxed separately from other sources of income at a flat rate of 20.315% (15.315% national tax + 5% local inhabitant’s tax).”View source · accessed 2026-09-26 — Gains on shares and similar securities are taxed separately at a flat 20.315% (15.315% national tax including surtax plus 5% local inhabitant tax), and dividends from listed companies can opt into the same flat rate. Real estate gains are taxed at 20.315% when held over five years and 39.63% otherwise.
Social security employee
14.69% (as of 2026)PwC Worldwide Tax Summaries“An employee whose salary or bonus, including fringe benefits, is paid in Japan by a local employer (including a Japanese branch of a foreign corporation) is generally liable to pay a share of social insurance premiums.”View source · accessed 2026-09-26 — Employees paid in Japan by a local employer contribute about 14.69% of salary (Tokyo health insurance 4.925%, child and childcare support 0.115%, welfare pension 9.15% and unemployment insurance 0.5%), subject to monthly wage caps. Employees aged 40 to 64 also pay 0.81% for long-term care insurance, and the contributions are deductible for income tax.
Consumption tax
10% (as of 2019)Ministry of Finance Japan“Standard tax rate: 10% (7.8% in national tax and 2.2% in local tax)”View source · accessed 2026-09-26 — Japan's consumption tax (its VAT) has a standard rate of 10% (7.8% national plus 2.2% local) and a reduced 8% rate for food, non-alcoholic beverages and newspaper subscriptions. A Cabinet-approved outline from September 2026 plans a temporary cut in the rate on food and beverages from 1 April 2027 to 31 March 2029, which does not affect the 10% standard rate.
Non resident employment income rate
20.42% (as of 2026)PwC Worldwide Tax Summaries“A non-resident taxpayer’s Japan-source employment income is subject to a flat 20.42% national income tax on gross compensation, with no deductions available.”View source · accessed 2026-09-26 — Non-residents are taxed only on Japan-source income, and their Japan-source employment income is taxed at a flat 20.42% (20% plus the 2.1% surtax) on the gross amount with no deductions, subject to any treaty relief. Where the salary is not withheld in Japan, the non-resident must file a return and pay the 20.42% tax.
Crypto asset gains
Crypto-asset gains are currently miscellaneous income taxed at progressive rates of up to about 55%. The 2026 tax reform proposes a separate flat rate of 20.315% with a three-year loss carryforward for specified crypto-assets traded through registered exchanges, but PwC reports it is not yet enacted. [source]PwC Worldwide Tax Summaries“Gains derived from crypto-asset transactions are currently taxable to individuals as miscellaneous income at graduated rates up to 55%.”View source · accessed 2026-09-26
Inheritance and gift tax
Inheritance and gift tax is charged to recipients at 10% to 55%, with an inheritance exemption of JPY 30 million plus JPY 6 million per statutory heir and an annual gift exemption of JPY 1.1 million per recipient. Assets located in Japan are always taxable, while foreigners on work-type (Table 1) statuses who have been domiciled in Japan for 10 years or less of the last 15 are generally taxed only on Japanese assets. [source]PwC Worldwide Tax Summaries“The basic exemption is JPY 30 million plus JPY 6 million per statutory heir.”View source · accessed 2026-09-26

Special tax regimes in Japan

15.315% (as of 2015)KPMG Japan Tax Newsletter (20 April 2015)“Under the 2015 tax reform, special measures to impose income tax on unrealized capital gains on financial assets held by an individual at the time of departure from Japan (exit tax regime) were introduced.”View source · accessed 2026-09-26 — Individuals leaving Japan with securities and similar financial assets worth JPY 100 million or more who have lived in Japan for more than 5 of the last 10 years are taxed at 15.315% on unrealised gains as if the assets were sold on departure. Time spent on Table 1 work-type statuses of residence does not count toward the 5 years, so foreign employees on working visas are generally outside the regime.

Minimum tax high income
22.5% (as of 2025)PwC Worldwide Tax Summaries“For tax years 2025 and 2026, where the individual’s aggregate income amount exceeds JPY 330 million of the threshold, the minimum tax is computed as 22.5% of the excess over JPY 330 million.”View source · accessed 2026-09-26 — From tax year 2025 a minimum tax of 22.5% of income above JPY 330 million applies when it exceeds the regular income tax, which mainly affects very large separately taxed capital gains. From tax year 2027 the rate rises to 30% and the threshold falls to JPY 165 million.

Digital nomad visa in Japan

Designated Activities (Digital Nomad) (as of 2024)Immigration Services Agency of Japan“Annual income of an applicant must be at least 10 million yen at the time of application.”View source · accessed 2026-09-26 — Japan's digital nomad status (Designated Activities) allows remote work for foreign employers or clients for up to six months with no extension, for nationals of listed visa-exempt treaty countries earning at least JPY 10 million a year and holding private medical insurance covering at least JPY 10 million. The MOFA visa page for the status is dated 31 March 2024.

Frequently asked questions

What is the top personal income tax rate in Japan?

55.945% (as of 2015)Ministry of Finance Japan (Learning More About Taxes, June 2024)“For income from 2015, a new tax rate of 45% was created for taxable income exceeding 40 million yen to revive income redistribution function of the tax system.”View source · accessed 2026-09-26 — The top combined marginal rate on ordinary income is 55.945%: 45% national income tax on taxable income above JPY 40 million, plus the 2.1% reconstruction surtax on that tax (45% x 1.021 = 45.945%), plus the flat 10% local inhabitant tax. From 2027 the surtax is split into 1.1% reconstruction and a new 1% defense surtax, which leaves the combined rate unchanged.

Does Japan have a digital nomad visa?

Designated Activities (Digital Nomad) (as of 2024)Immigration Services Agency of Japan“Annual income of an applicant must be at least 10 million yen at the time of application.”View source · accessed 2026-09-26 — Japan's digital nomad status (Designated Activities) allows remote work for foreign employers or clients for up to six months with no extension, for nationals of listed visa-exempt treaty countries earning at least JPY 10 million a year and holding private medical insurance covering at least JPY 10 million. The MOFA visa page for the status is dated 31 March 2024.

Sources

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When to talk to an advisor

This page maps Japan’s general rules — it cannot weigh your treaty position, your family and asset ties, or the timing of a move. If meaningful money depends on the answer, have a qualified advisor in Japan (and in your home country) review your situation before you act.