What is JUMIN ZEI?
Have you received your resident tax notice with your June pay stub? If so, read on.
WHAT IS JUMIN ZEI?
Jumin zei 住民税 is resident tax, inhabitant tax, or local income tax in Japan. Resident tax is levied on Japan residents who earn more than 1,000,000 JPY per calendar year. This tax covers the cost of public services such as education, infrastructure, police departments, fire stations, and welfare for senior citizens, etc.
HOW IS IT CALCULATED?
Your ward office, kuyakusho or shiyakusho, receives a copy of your wage and tax statement from your employer in January every year. If you file a personal income tax return in March, your tax office forwards your tax return to your ward office. You have income in Japan in 2021 and have a registered address in Japan as of 1 January 2022, then you will be obligated to pay this tax.
You will receive R4 (2022) resident tax notice from your employer or payroll provider. Please see the example below:
HOW DO I READ IT? Your Resident Tax notice above shows:
Adjusted Income is the adjusted total of all your earnings from the previous year, 2021.
Total Deductions: Most salaried employees have social insurance deductions which show the total contributions you made through monthly withholding of your health and pension in addition to a standard deduction of 330,000 JPY. If you have any dependents, private insurance, or a housing loan, you may qualify for additional deductions.
Taxable Income = Adjusted Income – Total Deductions It is rounded down to the nearest 1000 JPY.
Resident Tax Due: This equates to approximately 10% of your taxable income. Some cities have additional taxes. For example, Yokohama Ward charges a “green tax” on their residents to plant more trees and to cover the cost of landscape maintenance.
WHEN DO I PAY IT?
If your pay day is on the 25th, your employer will withhold 32,300 yen from your 2022 June 25th paycheck. From 2022 July 25th through 2023 May 25th, 31,400 yen will be withheld from your paycheck each month. Even if you leave Japan before 2023 May 25th, you still have to pay for the remaining balance.
Please note for those who are planning to leave Japan that your final official day of residence in Japan can have a major effect on your resident tax obligations. Don’t forget to inform your Ward Office about your departure.
If you have a registered address in Japan as of 2023 January 1st, you will be obligated to pay the resident tax based on your 2022 income.
If you de-register your address on or before 2022 December 31, you will not be obligated to pay residence tax based on your 2022 income.
If you are not sure about your particular situation, please contact us.