Resident Tax
住民税 (Jūmin-zei)
Resident tax is a local tax paid to your city and prefecture. Unlike income tax which goes to the national government, this funds local services: schools, roads, garbage collection, and public health. It is calculated on last year's income and billed the following year.
"Resident tax is like the 'membership fee' you pay your city. The city ran its services last year — now it's sending you the bill based on how much you earned."
Because it's based on last year's income, there's always a one-year delay. Move to Japan in January 2025? You owe nothing in 2025. But in June 2026, the bill for your 2025 earnings arrives — this surprises many new residents who weren't saving for it.
Resident tax is assessed on income earned in the previous calendar year for anyone who was a resident on January 1st of the assessment year.
If you arrived in Japan any time during 2025 and were not a resident on January 1st 2025, you will receive zero resident tax bill in 2025. Your first bill arrives in June 2026 — covering your 2025 earnings.
Practical tip: Save roughly 8–10% of your net income in year 1, because the June 2026 bill will be larger than expected — it covers a full year of 2025 earnings in one shock.
Your employer deducts resident tax from your monthly income in 12 instalments, June through May. This is the default for company employees — you'll see it on your pay stub.
The city sends you 4 payment slips (June, August, October, January). Used for freelancers, part-timers below the employer threshold, or when you leave a company mid-year. Pay at a convenience store, bank, or via direct debit.
If you leave Japan permanently, you must either pay all outstanding resident tax before departure or appoint a tax agent (納税管理人) who will receive and pay the bills on your behalf. Unpaid tax follows you.
If your total income was below roughly ¥350,000–¥450,000 (varies by municipality + number of dependents), you may be fully exempt from resident tax for that year. Check with your city office.
| Feature | Income Tax (所得税) | Resident Tax (住民税) |
|---|---|---|
| Who collects it | National government (NTA) | Your city & prefecture |
| Rate structure | Progressive (5%–45%) | Flat 10% + ¥5,000 |
| When paid | Current year (withheld monthly) | Following year (June–May) |
| Basic exemption | ¥480,000 | ¥430,000 |
| First year in Japan | Owed from arrival | Waived — first bill next June |
| Blue Return bonus | ¥650,000 deduction | ¥650,000 deduction (same) |
Donations to rural municipalities come back almost entirely as a resident tax credit. A ¥50,000 donation costs you only ¥2,000 out-of-pocket. Use the One-Stop system to avoid filing a return.
If your income tax is too low to absorb the full housing deduction, the remainder spills over and reduces your resident tax bill (capped at 5% of previous year's income or ¥97,500).
Claim medical expenses over ¥100,000 in your tax return. This reduces both income tax and the next year's resident tax base.
iDeCo contributions are fully deducted from income, reducing both income tax and the resident tax base calculated from that income.