Individual Residential Tax in Japan

1. What Is the Individual Residential Tax

There would not be a residential tax in the US and the UK. Since the Council tax in the UK imposes a citizen based on the residence, the council tax is similar to Japanese real estate tax translated into fixed asset tax in official documents issued by local governments.

Residential tax is sometimes called residence tax and translated into inhabitant tax officially in Japan. Here I use residential tax to explain it.

2. Calculation of the Individual Residential Tax

Japanese individual residential tax consists of two components. One is calculated by individual taxable income, and the other one is a fixed amount of capita basis that is JPY 5,500 in 2017 Tokyo. The income basis part of the individual residential tax is calculated by the taxable income and the tax rate. The tax rate for individual tax rate is 10.0% in Tokyo.

3. Key You Have to Notice

The tax rate of income tax for individuals is below, that depends on the taxable income level. If you roughly calculate and figure out your income tax impact, you have to add 10.0% of the residential tax rate for income basis to the income tax rate of national tax.

As of 2017
Taxable Income (JPY) The tax Rate Amount Deducted from Taxable Income
Equal to/Less than 1,950,000 5% 0
More than 1,950,000 Equal to/Less than 3,300,000 10% 97,500
More than 3,300,000 Equal to/Less than 6,950,000 20% 427,500
More than 6,950,000 Equal to/Less than 9,000,000 2% 636,000
More than 9,000,000 Equal to/Less than 18,000,000 33% 1,536,000
More than 18,000,000 Equal to/Less than 40,000,000 40% 2,796,000
More than 40,000,000 50% 4,796,000