Japan

Individual - Foreign tax relief and tax treaties

Last reviewed - 27 December 2019

Foreign tax relief

Resident taxpayers can credit foreign income taxes against their Japanese national tax and local inhabitant’s tax liabilities (with certain limitations), where non-Japan-source income is taxed in Japan. Non-resident taxpayers are not entitled to take foreign tax credits on their Japan income tax returns unless one has a PE in Japan.

Tax treaties

As of 20 September 2019, Japan has tax treaties with the following countries:

Australia Hungary Philippines
Austria Iceland Poland
Bahamas India Portuguese Republic
Bangladesh Indonesia Qatar
Belgium Ireland, Republic of Russia
Bermuda Isle of Man Romania
Brazil Israel Samoa
British Virgin Islands Italy Saudi Arabia
Brunei Jersey Singapore
Bulgaria Kazakhstan Slovenia
Canada Korea, Republic of South Africa
Cayman Islands Kuwait Spain
Chile Latvia Sri Lanka
China Liechtenstein Sweden
Croatia Lithuania Switzerland
Czechoslovakia (1) Luxembourg Taiwan
Denmark Macao Thailand
Egypt Malaysia Turkey
Estonia Mexico USSR (2)
Fiji Netherlands United Arab Emirates
Finland New Zealand United Kingdom
France Norway United States
Germany Oman Vietnam
Guernsey Pakistan Zambia
Hong Kong Panama

Notes

  1. The treaty with the former Czechoslovakia is applied to the Czech Republic and the Slovak Republic.
  2. The treaty with the former USSR is applied to Armenia, Azerbaijan, Belarus, Georgia, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, Ukraine, and Uzbekistan.

Mutual Administrative Assistance

Japan has signed a Convention on Mutual Administrative Assistance in Tax Matters and it is effective.

Base Erosion and Profit Shifting (BEPS) Agreement

On 7 June 2017, Japan signed a Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS, which will not be effective until the instrument of ratification is submitted. As of 30 September 2019, it is effective with Australia, Austria, Belgium, Canada, Denmark, Finland, France, Georgia, Guernsey, Iceland, India, Ireland, Isle of Man, Israel, Jersey, Lithuania, Luxembourg, Malta, Monaco, Netherlands, New Zealand, Norway, Poland, Russia, Serbia, Singapore, Slovakia, Slovenia, Sweden, Switzerland, Ukraine, United Arab Emirates, and the United Kingdom.

Totalisation agreements

Designed to avoid overlaps in social security enrolment, Japan has entered into social security agreements with several countries. As of 1 October 2019, the agreements currently in effect are with Australia, Belgium, Brazil, Canada, China, the Czech Republic, France, Germany, Hungary, India, Ireland, Korea, Luxembourg, the Netherlands, Philippines, Slovak Republic, Spain, Switzerland, the United Kingdom, and the United States. Agreements with Finland, Italy, and Sweden have been signed and are in the process of implementation.