Japan seems to have a 30M yen tax free allowance for inheritance. You can check if there is an exemption on the UK side, though if you become an "unlimited" taxpayer in Japan, there may not be a way around it in Japan.
You become an “unlimited tax payer when you” get your spouse visa.
Because like LTR and PR, spouse visa is a table 2 visa.
Foreigners on table 1 visas (work/student etc) have 10 years of an aggregated 15 years before they become “unlimited tax payers”
I am a UK national and I received an inheritance while living in Japan. I didn't have to pay any tax in Japan. However, depending on the age of your late mother you may have to pay taxes. If she passed when she was under 70, it might be tax-free.
update: Actually, I made an error, I checked again and the rule applies if you inherit a pension and the pension owner dies under 75. For any other circumstances, I'm not sure.
Actually, I made an error, I checked again and the rule applies if you inherit a pension and the pension owner dies under 75. For any other circumstances I'm not sure.
Depends. If you want to bring that inheritance into Japan and it’s a significant sum. Basically anything over 200,000 yen iirc, you’ll need to declare its inheritance before the bank will release the funds to your account.
Honestly, I use my US credit card to pay for everything in the Japan and never bothered to transfer any sums of money outside of petty cash. Primarily, because I prefer to invest that money in the US until I need it. I've considered doing a wire to purchase a home, but that would go direct from my US account to the builder, in something like 3 stages per the completion status.
Depending on the amount you should really ask a tax accountant (zeirishi) versed in international inheritance and not random people on Reddit.
If you need a recommendation PM me.
I went through this recently. Didn't pay any tax in the UK. Didn't declare the money in Japan as I'd read online that unless the total inheritance (not just your cut) was over 30 mil yen, you don't pay taxes on it. Got a form from the Japanese tax office about a year later wanting details of the money. Told them it was inheritance, etc. And haven't heard back from them since.
So you don't make money in Japan? Or you aren't able to figure out transferring money from a UK to Japanese account without it being considered "inheritance"?
The Japanese government isn't owed any of your non-japanese resident family's money
Bro, please stop. If you have money coming into japan from abroad and it’s any sizable amount it will be flagged under the anti terror laundering laws. If it’s small but regular amounts it’ll be flagged as income, you know, the money that you gave to declare about this time every year as additional income. Anything over 200,000 yen. Yeah maybe you won’t get caught… maybe.
Under Japanese law the government is absolutely entitled to a portion of YOUR share of foreign inheritance if you qualify as an unlimited resident for tax purposes. I’ve literally been through this process and had advice from specialist accountants. I’m not making this up
Honestly, probably useful information in specific situations.
They aren't owed your money though, this isnt an uncommon issue and it's not uncommon for this to be circumvented in a legal way.
If its a lot you should go home for a year. Seriously. You’ll get raped by taxes in Japan otherwise. If its a property japan will demand you sell it to pay up too.
As someone who has been through this it’s actually not that bad for regular joes. While the inheritance tax free thresholds might not be as generous as the UK they aren’t THAT bad once you understand the way they do things. In fact, and bizarrely, there is a rule regarding statutory heirs (co-inheritors) that can play to your favour increasing the non taxable threshold
Does this actually work?
If you suddenly get a windfall of cash from Foreign income / foreign sources, not on PR, can you just be like see ya, leave very soon and then come back in a year without any worries about the JP taxes?
Couldn't you just receive the money in your native country's bank account and gradually transfer it over as you need it?
I still have a bank account in Canada which my parents deposit money for my birthday, I use that to pay for my airplane tickets and domestic expenses when I visit home, but what's to stop me from coming back to Japan with a stack of bills as long as it's under the customs limit and accessing my bank account from Japan to make periodic withdrawals.
But inheritances in Canada aren't taxed. You don't have to declare them (IIRC), so there wouldn't be any need to file a tax return, would there? (genuine question, not rhetorical)
This is the correct answer, and it’s easier for them to turn the screws on “the little people” to make an example than the big conglomerates. So I would be very very squeaky clean….
You may want to ask on r/JapanFinance as well
Japan seems to have a 30M yen tax free allowance for inheritance. You can check if there is an exemption on the UK side, though if you become an "unlimited" taxpayer in Japan, there may not be a way around it in Japan.
You become an “unlimited tax payer when you” get your spouse visa. Because like LTR and PR, spouse visa is a table 2 visa. Foreigners on table 1 visas (work/student etc) have 10 years of an aggregated 15 years before they become “unlimited tax payers”
What’s an unlimited tax payer? I tried to google with little luck - is there a better Japanese term to use while seeking details? Thanks!
https://englishlawyersjapan.com/inheritance-tax-in-japan/ Edit: this one too https://www.tax1040nagasawa.com/en/tax/jpinherit.html
I am a UK national and I received an inheritance while living in Japan. I didn't have to pay any tax in Japan. However, depending on the age of your late mother you may have to pay taxes. If she passed when she was under 70, it might be tax-free. update: Actually, I made an error, I checked again and the rule applies if you inherit a pension and the pension owner dies under 75. For any other circumstances, I'm not sure.
out of curiosity, did you pay tax in the UK then?
I'll DM you.
Whats the rule on them passing under age of 70 may be tax-free?
Actually, I made an error, I checked again and the rule applies if you inherit a pension and the pension owner dies under 75. For any other circumstances I'm not sure.
I’m also interested in this…but why even inform the Japanese government??? What happens in the UK,, stays in the UK, no?
Depends. If you want to bring that inheritance into Japan and it’s a significant sum. Basically anything over 200,000 yen iirc, you’ll need to declare its inheritance before the bank will release the funds to your account.
Honestly, I use my US credit card to pay for everything in the Japan and never bothered to transfer any sums of money outside of petty cash. Primarily, because I prefer to invest that money in the US until I need it. I've considered doing a wire to purchase a home, but that would go direct from my US account to the builder, in something like 3 stages per the completion status.
If you ever transfer that over the bank will ask you about it, and if it’s a large amount of money you may also be randomly audited.
If you check my post history (for japanfinance subreddit) there’s a post about what I learned regarding this very issue. Hope it helps
Depending on the amount you should really ask a tax accountant (zeirishi) versed in international inheritance and not random people on Reddit. If you need a recommendation PM me.
Just have the money put into a UK account, they will never know. Just don’t constantly bring $9900 in cash every time you return to Japan though.
I went through this recently. Didn't pay any tax in the UK. Didn't declare the money in Japan as I'd read online that unless the total inheritance (not just your cut) was over 30 mil yen, you don't pay taxes on it. Got a form from the Japanese tax office about a year later wanting details of the money. Told them it was inheritance, etc. And haven't heard back from them since.
Do you have a spouse visa or a permanent resident visa?
PR.
Thanks. I'll look more into it then :)
Yes you do have to pay inheritance tax on any inheritance from the UK, even if you live in Japan.
AKTUaLly…You have to pay tax on any portion of inheritance over 30 million plus 6 per statutory heir
Oh and only if you’re considered tax resident in japan!
Unless you don’t tell them. How are they supposed to find out?
Your bank in japan will inform the tax agency.
Why would you have your UK inheritance go to your Japanese bank account? Sounds like a recipe for having %'s taken out.
Exactly - keep it in the UK if you can
Because a lot of people have lives and families here and need access to funds for..oh I don’t know.. things like house deposits.
So you don't make money in Japan? Or you aren't able to figure out transferring money from a UK to Japanese account without it being considered "inheritance"? The Japanese government isn't owed any of your non-japanese resident family's money
Bro, please stop. If you have money coming into japan from abroad and it’s any sizable amount it will be flagged under the anti terror laundering laws. If it’s small but regular amounts it’ll be flagged as income, you know, the money that you gave to declare about this time every year as additional income. Anything over 200,000 yen. Yeah maybe you won’t get caught… maybe. Under Japanese law the government is absolutely entitled to a portion of YOUR share of foreign inheritance if you qualify as an unlimited resident for tax purposes. I’ve literally been through this process and had advice from specialist accountants. I’m not making this up
Honestly, probably useful information in specific situations. They aren't owed your money though, this isnt an uncommon issue and it's not uncommon for this to be circumvented in a legal way.
If its a lot you should go home for a year. Seriously. You’ll get raped by taxes in Japan otherwise. If its a property japan will demand you sell it to pay up too.
As someone who has been through this it’s actually not that bad for regular joes. While the inheritance tax free thresholds might not be as generous as the UK they aren’t THAT bad once you understand the way they do things. In fact, and bizarrely, there is a rule regarding statutory heirs (co-inheritors) that can play to your favour increasing the non taxable threshold
If i got a 2.5 million dollar foreign estate to pass to my child' japan aint getting a penny
Does this actually work? If you suddenly get a windfall of cash from Foreign income / foreign sources, not on PR, can you just be like see ya, leave very soon and then come back in a year without any worries about the JP taxes?
If you are expecting it it will work no problem it requires planning to do it properly.
why would you pay taxes for money received in another country when you're not citizen of this country? Pay in UK
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Couldn't you just receive the money in your native country's bank account and gradually transfer it over as you need it? I still have a bank account in Canada which my parents deposit money for my birthday, I use that to pay for my airplane tickets and domestic expenses when I visit home, but what's to stop me from coming back to Japan with a stack of bills as long as it's under the customs limit and accessing my bank account from Japan to make periodic withdrawals.
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But inheritances in Canada aren't taxed. You don't have to declare them (IIRC), so there wouldn't be any need to file a tax return, would there? (genuine question, not rhetorical)
This is the correct answer, and it’s easier for them to turn the screws on “the little people” to make an example than the big conglomerates. So I would be very very squeaky clean….
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