East Asia
Japan: tax at a glance
A high-tax jurisdiction. The top combined income tax rate is near 56%, and the country has the world's highest inheritance tax, reaching 55%, which applies to the worldwide estates of long-term foreign residents.
Ways to relocate to Japan
The residency and citizenship routes that lead here, weighed against the tax picture above.
The taxes
- Personal income (top)
- 45% national rate (about 55.9% combined with the 10% local inhabitant tax).The national tax is progressive, running 5–45%, with the top bracket applying above JPY 40M. On top of that sits a flat 10% local inhabitant tax and a 2.1% reconstruction surtax on the national tax.
- Corporate income
- About 29.7% effective (national rate of 23.2% plus local taxes).
- Capital gains
- 20.315% flat on listed securities (15.315% national plus 5% local).
- VAT / Consumption Tax (消費税)
- 10%
- Dividends (WHT)
- 20.42% for non-residents, or 15.315% on listed shares.
- Interest (WHT)
- 15.315%, rising to 20.42% on certain payments to non-residents.
- Royalties (WHT)
- 20.42%
- Social security (employee)
- About 15% (pension at 9.15%, health at about 5%, plus care insurance).
- Social security (employer)
- ~15%+ (pension 9.15% + health + labour insurance)
- Wealth tax
- None
- Inheritance / estate
- 10–55% progressive, the world's highest top rate. This applies as a worldwide estate tax for long-term or Table-2-visa residents.
- Property tax
- A fixed asset tax of 1.4% of assessed value, plus a city planning tax.
- Other
- A reconstruction surtax of 2.1% on income tax, plus a 10% local inhabitant tax.
How the system works
- Tax system
- Worldwide (residence-based)
- Foreign income
- Taxed (worldwide)
- Taxes by citizenship
- No
- Exit tax
- Yes, leaving has a cost
- CFC rules
- Yes
- CRS
- Participating
A special regime for new arrivals
Non-permanent residents, meaning non-Japanese nationals resident 5 years or less in the preceding 10, are taxed on Japan-source income plus foreign-source income remitted to Japan. This is a genuine remittance basis, but it expires, and it does NOT protect against inheritance tax.
The rates below are indicative headline figures (top marginal, standard, and headline rates), reviewed 2026-07. Brackets, surcharges, and state, provincial or cantonal taxes vary. Treat this as a reference map, not advice.
Sources (3)
Secondary references