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Be wary of your investments -- the TAXMAN is watching

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  • Originally posted by Super Grover View Post
    Keep in mind that if you move here as soon as you cross the 5-year threshold, stuff becomes taxable. AT FIRST, you will not be taxed on it, however, and if you declare nothing, even if they are aware of your failur to declare, they won't do a thing. THEN, some years later when they are able to apply maximum penalties, THEN they will audit you and hit you up for whatever they can. It is a deliberate plan to get as much money as possible. It is insidious. Once you pass 5 years, make sure to declare everything OR structure what you have so that it cannot be found/taken.

    Gifting -- be real careful about that, too.

    When in doubt, contact and pay for qualified, expert advice.

    While I agree with Super Grover that the tax office is coming down on people and that you should hire an expert, I can't buy in on the notion that they wait until 5 or 7 years in an insidious plan to exploit us. I've been here 30 years and was never audited until last year, when they could have done so much earlier and gotten more. They were kind in turning a blind eye to many earlier trespasses, even though they had the information.

    As for gifting, of course they are going to look at that very carefully. Gifting has been a kind of money laundering here for ages. Maybe the biggest reform in Japan after the war was to limit inherited (gifted) wealth and redistribute land as a means to get rid of the permanently rich aristocracy.

    Super Grover, I think your experience was different from mine. I get the impression that you feel they are tricky and immoral, rather than just trying to apply the law, albeit a poor one in some ways.

    Comment


    • Originally posted by ctskelly View Post
      While I agree with Super Grover that the tax office is coming down on people and that you should hire an expert, I can't buy in on the notion that they wait until 5 or 7 years in an insidious plan to exploit us. I've been here 30 years and was never audited until last year, when they could have done so much earlier and gotten more. They were kind in turning a blind eye to many earlier trespasses, even though they had the information.

      As for gifting, of course they are going to look at that very carefully. Gifting has been a kind of money laundering here for ages. Maybe the biggest reform in Japan after the war was to limit inherited (gifted) wealth and redistribute land as a means to get rid of the permanently rich aristocracy.

      Super Grover, I think your experience was different from mine. I get the impression that you feel they are tricky and immoral, rather than just trying to apply the law, albeit a poor one in some ways.
      The tax office is tricky and immoral and will try to catch you out however they can.

      In SG's case they very likely were aware within 2 years of his sending/investing money offshore and just let the ball ride until there were some sizeable fines and penalties built up. The objective in this case was to make an example.

      Comment


      • Hi Super Grover, i think the 5 year threshold might not even be true judging by the way NTA define Non-permanent Resident - ' 5 years or less". 'OR LESS'!! You could be living in Japan for a year or a month and be deemed a Nonpermanent resident if NTA thinks you have a domicile or residence. Am i reading it wrong? This is just getting more confusing for me.

        Non-permanent Resident - (A resident taxpayer of non Japanese nationality who has had domicile or residence in Japan for an aggregate period of five years or less within the last ten years.)


        Originally posted by Super Grover View Post
        Keep in mind that if you move here as soon as you cross the 5-year threshold, stuff becomes taxable. AT FIRST, you will not be taxed on it, however, and if you declare nothing, even if they are aware of your failur to declare, they won't do a thing. THEN, some years later when they are able to apply maximum penalties, THEN they will audit you and hit you up for whatever they can. It is a deliberate plan to get as much money as possible. It is insidious. Once you pass 5 years, make sure to declare everything OR structure what you have so that it cannot be found/taken.

        Gifting -- be real careful about that, too. They tried to get us on that one but their grounds were dodgy and they failed. The point is that they tried and had we not fought, they would have assessed us for more. I know I rant, but they are out to get money however they can.

        When in doubt, contact and pay for qualified, expert advice.

        Comment


        • Originally posted by mecafe1 View Post
          Hi Super Grover, i think the 5 year threshold might not even be true judging by the way NTA define Non-permanent Resident - ' 5 years or less". 'OR LESS'!! You could be living in Japan for a year or a month and be deemed a Nonpermanent resident if NTA thinks you have a domicile or residence. Am i reading it wrong? This is just getting more confusing for me.

          Non-permanent Resident - (A resident taxpayer of non Japanese nationality who has had domicile or residence in Japan for an aggregate period of five years or less within the last ten years.)
          You're understanding it wrong. What it says is:

          Among residents, any individual of non Japanese nationality having domicile or residence in Japan for an aggregate period

          of five years or less within the last ten years is classified as a
          non-permanent resident.
          Which makes perfect sense. A non-permanent resident is only taxed on Japan sourced income, remittances, etc. Not worldwide, non-Japan sourced income.
          Last edited by iago; 2011-05-23, 05:30 PM.

          Comment


          • This thread is scaring the crap out of me. Can anyone give me advice on my situation?:

            Before I came to Japan, I bought an apartment in the UK (80k pounds, 2008) on the advice of my folks. Came to Japan maybe 2 months after completion. Been here since. My folks, who have 'power of attorney', got a tenant to pay the mortgage and service charge. Basically it breaks even. Maybe ten pounds 'profit' a month.

            Since 2010, I have been sending in the region of 50,000yen a month, which basically pays my credit card bills and the internet at my folks house. The money I send back basically disappears.

            Otherwise, I have no investments, no shares or anything like that. But is the apartment going to affect me big time in the future? I plan on staying here for another 5 years or so (probably getting married etc). I appreciate any clarification guys. Thanks.

            Comment


            • you are fine as far as i can see until you sell the apt.

              Comment


              • So long as you take a loss on the sale - no problem. You will take a loss I presume. And to ensure that you do - maybe you should be keeping copies of funds transfers (which go for maintenance and management overhead), and any flights back (inspections), etc.

                Comment


                • SG, TJ random, thanks for the info.

                  I have no intention of selling it whilst in Japan. Mortgage still has a long way to go too, and I'll be back in England permanently before then, surprises witholding. Its just shocking to read some of the stories on the thread. Maybe it should be a sticky or something.

                  Thanks again.

                  Comment


                  • Originally posted by nanoripe View Post
                    This thread is scaring the crap out of me. Can anyone give me advice on my situation?:

                    Before I came to Japan, I bought an apartment in the UK (80k pounds, 2008) on the advice of my folks. Came to Japan maybe 2 months after completion. Been here since. My folks, who have 'power of attorney', got a tenant to pay the mortgage and service charge. Basically it breaks even. Maybe ten pounds 'profit' a month.

                    Since 2010, I have been sending in the region of 50,000yen a month, which basically pays my credit card bills and the internet at my folks house. The money I send back basically disappears.

                    Otherwise, I have no investments, no shares or anything like that. But is the apartment going to affect me big time in the future? I plan on staying here for another 5 years or so (probably getting married etc). I appreciate any clarification guys. Thanks.
                    I doubt the tax authorities will find out about your situation but if they did I suspect you'd be in a little bit more trouble than suggested.

                    It really depends on what "basically breaks even" means. If your rental income "breaks even" with your interest payments and other expenses then you'd be ok. If "break even" means repaying the principal also then you might be in for a shock.

                    Comment


                    • Originally posted by nanoripe View Post
                      This thread is scaring the crap out of me. Can anyone give me advice on my situation?:

                      Before I came to Japan, I bought an apartment in the UK (80k pounds, 2008) on the advice of my folks. Came to Japan maybe 2 months after completion. Been here since. My folks, who have 'power of attorney', got a tenant to pay the mortgage and service charge. Basically it breaks even. Maybe ten pounds 'profit' a month.

                      Since 2010, I have been sending in the region of 50,000yen a month, which basically pays my credit card bills and the internet at my folks house. The money I send back basically disappears.

                      Otherwise, I have no investments, no shares or anything like that. But is the apartment going to affect me big time in the future? I plan on staying here for another 5 years or so (probably getting married etc). I appreciate any clarification guys. Thanks.
                      __________________________________________________ ______________________________________________

                      If you are earning and income from any investment, they will tax the the income from the investment saving, or rental property. Having been investigated last year last year, over a 6 month period, with a regional tax hearing in November, I paid my last tax and punishments bills to the national tax, current city tax office , previous different city tax offices last month. My days of regular saving ended abruptly. The total cost of my overseas retirement plan cost me 2,000,000 yen

                      Who would have thought a property sold 15 years ago would bite me in the ar*e. My mistake was transferring over 1 million to pay for school fees. However, I donft live in Fukushima and I have a job and a roof over my head, so I should be thankful.

                      This week two Filipino males in Nagoya were caught operating a bank. The were receiving one million yen a day of cash from Filipino workers from all over Japan and remitting funds to the Philippines, on their behalf, taking a 3% commission.
                      They will get roasted. Fascinates me how somebody could set up a bank from home and handle such a huge sum of money. The great east Japan disaster weighing down the govt, we can expect a consumption tax increase soon.
                      When you consider we pay income tax, local tax, vehicle shaken rip-0ff tax, road tax/compulsory insurance
                      (now due), unemployment tax and the famous kousokudoru expressway extortion. The Japanese government should be rolling in revenue.

                      The aging society and care for the elderly is one of the growing national costs. I keep thinking where will Japan be in 5 years time. Its days as a manufacturing juggernaut are limited, with China and India steam-rolling ahead. I suspect we will see the growth of a foreign underclass worker, who receive lower pay to offset high manufacturing costs, or massive transfer overseas of manufacturing and high unemployment. Japan needs to invent a google, facebook, twitter type product that has global appeal. Solar energy is another untapped overpriced market, that could create jobs. Long term economic survival requires change.
                      Once on the radar, be transparent because they have access to all your details. Gambatte!

                      Comment


                      • on the radar

                        "Once on the radar, be transparent because they have access to all your details. "

                        I assume that *On the radar* refers to electronic transfer of funds between banks being visible to the authorities.

                        However, I believe that you will probably *not* have tax people arriving at your house with cardboard boxes to take away and examine documents and computers.

                        Could any of the folks who were audited confirm this?

                        Comment


                        • There is a semi-police tax section who will come to your home/business with search warrant and boxes and will look at your computers and cart everything away. This is for far, far, far (x100) more serious violations.

                          Comment


                          • O'Hanlon, were you here in Japan when you sold the property 15 years ago? I am just trying to understand why something 15 years ago would matter unless you were already in Japan, still i thought the tax law extends 5 years back at most.

                            Originally posted by O'Hanlon View Post
                            __________________________________________________ ______________________________________________

                            If you are earning and income from any investment, they will tax the the income from the investment saving, or rental property. Having been investigated last year last year, over a 6 month period, with a regional tax hearing in November, I paid my last tax and punishments bills to the national tax, current city tax office , previous different city tax offices last month. My days of regular saving ended abruptly. The total cost of my overseas retirement plan cost me 2,000,000 yen

                            Who would have thought a property sold 15 years ago would bite me in the ar*e. My mistake was transferring over 1 million to pay for school fees. However, I donft live in Fukushima and I have a job and a roof over my head, so I should be thankful.

                            This week two Filipino males in Nagoya were caught operating a bank. The were receiving one million yen a day of cash from Filipino workers from all over Japan and remitting funds to the Philippines, on their behalf, taking a 3% commission.
                            They will get roasted. Fascinates me how somebody could set up a bank from home and handle such a huge sum of money. The great east Japan disaster weighing down the govt, we can expect a consumption tax increase soon.
                            When you consider we pay income tax, local tax, vehicle shaken rip-0ff tax, road tax/compulsory insurance
                            (now due), unemployment tax and the famous kousokudoru expressway extortion. The Japanese government should be rolling in revenue.

                            The aging society and care for the elderly is one of the growing national costs. I keep thinking where will Japan be in 5 years time. Its days as a manufacturing juggernaut are limited, with China and India steam-rolling ahead. I suspect we will see the growth of a foreign underclass worker, who receive lower pay to offset high manufacturing costs, or massive transfer overseas of manufacturing and high unemployment. Japan needs to invent a google, facebook, twitter type product that has global appeal. Solar energy is another untapped overpriced market, that could create jobs. Long term economic survival requires change.
                            Once on the radar, be transparent because they have access to all your details. Gambatte!

                            Comment


                            • How would the J. tax man ever find out that nanoripe has a house in a foreign country?
                              How would they ever know he has tenant(s) in the house paying his mortgage?
                              How would they know he has mortgage?
                              If he makes less than 10,000,000 yen a year he doesn't have to declare his worldwide assets.
                              Nanoripe just came to this country, he's got no assets here.
                              The J. tax department knows very well that they can't get blood from a stone, if he's got nothing that they can take away from him in Japan, as in real estate, bank accounts, etc, they will do nothing.
                              I suspect that the people who got audited do have (sizeable)assets in Japan, well paying jobs and perhaps savings in banks that can be seized which is why they became targets.
                              Guys with lowly eikawa gigs have a lot less to worry about in my humble opinion.

                              Comment


                              • Yeah apart from the house, I have no assets in the uk or japan, no stocks, no nothing. And I'm an ALT monkey, so I'm clinging onto the belief that I will be fine in the long run.

                                I think I'm in SantaKraut's camp when he/she says that those who got audited have the sizeable assets, or would anyone care to share otherwise?

                                Once again, thanks for eveyones input, I feel a lot better and more at ease. I know anything can happen, so I'll just pay a bit more attention from now on.

                                Comment

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