INCOME TAX RETURN

1. Tax return season is approaching

Every year from February 16 to March 15 is the income tax return period. This is the tax return about income from January 1 to December 31 of last year. Lone owners need to file an income tax return every year during this period. Those who ask for a tax accountant entitled "Zeirishi", have no worries, but without Zeirishi, the procedures are not very easy. If the tax return is not made correctly, it may be that a penalty and additional tax will be imposed. From time to time there is news that celebrities are missing declarations of sale and additional tax will be imposed. For example, lately there was news that it was revealed that the Tokyo Regional Tax Office taxed an additional 40 million yen to a very famous talent company and its affiliated companies for registering as an expense the "New Year's gifts" to their talents. In addition, it is not only an additional tax sanction, but it may also be that a criminal sanction is imposed in the case where the amounts are very large or the case is very malicious. On the contrary, if the tax returns are not presented in a good manner, you would pay unnecessary tax and lose a lot of money. That's why learning the tax return will serve to save your income.

2. Who needs to file a tax return?

People who work for themselves, who are lonely owners "Kojin jigyo nushi" need to file a tax return. On the other hand, company employees do not need to make a normal tax return. When the company pays salaries to employees, the company has deducted taxes. And at the end of the year companies adjust the income tax, which is called "Nenmatsu chosei". This is the calculation and adjustment of employee taxes. That's why employees don't need to pay tax by themselves. However, if you earn 200,000 yen or more per year apart from the salary, if you work in more than 2 companies and the salary of the company that Nenmatsu Chosei does not make is more than 200,000 yen per year or if you earn 20 million yen or more per year as salary you need to file a tax return. People who have sold goods such as land, houses, shares, etc. last year and have won also need to file a tax return. These goods include those that are abroad. That is, if you live in Japan, you need to declare income tax on earnings abroad. However, when the purchase amount including purchase procedure expenses such as registration fee, lawyer fee, etc. is higher than the amount of the sale, in other words, you have not been able to earn due to the sale, you do not need to make a declaration. Income tax is tax for profit. Therefore, the solitary owners who have earned little, specifically 480,000 yen or less per year, do not need to make a declaration either. In addition to these people, there are many other types of people who need to file a tax return. For example, the person who has earned a certain amount due to horse racing needs to do so.

On the other hand, there are people who have benefits from filing a tax return, although they are not obliged to do so. Lonely owners who earn sales less than expenses have benefits from making a declaration because they could deduct this loss from the following year's profit. People who have paid 100,000 yen or more in total last year for medical expenses can file a tax return and may receive a tax refund. This expense includes medical expenses of spouse and children that are pending of the person. This expense includes medicines, transportation to the hospital. But, if you receive insurance on this expense, you need to deduct this amount. When you get a mortgage to buy your own house, you can receive mortgage deductions by filing a tax return. A mortgage deduction can save you a lot of money on your income tax. Although it is not possible to list everything, there are several types of people who benefit from filing a tax return.

3. How to calculate income

Income is sales minus expenses. The tax is put on this income. Therefore, the higher the amount of sales, the higher the tax, and the higher the amount of expenses, the lower the tax. And the higher the income, the higher the tax rate. That is, the higher the income, not only the higher the tax amount, but the higher the tax rate. They need to declare all sales, of course. If I didn't do that, it would be illegal. However, of course, not declaring all expenses would not be illegal and would only pay unnecessary tax. Therefore, it is important to declare all expenses without forgetting them so that you do not pay unnecessary tax. Expenses are not only clear expenses such as labor, raw material expenses, purchase expenses for sale, office rental. If you eat and drink for a work meeting, the cost of eating and drinking is also an expense. If you use your house as a place of work, it can be considered that some part of your house rent is an expense. But, this calculation needs to be done reasonably. For example, if you use about 20% of the size of the house as a place of your work, 20% of rent can be considered an expense. If you use your car from Monday to Friday for your work, you can calculate 5 of seventh of the price of buying a car would be an expense. Also 5 of seventh of the cost of gasoline would be expense. If you use your phone about half the time for your business, you can calculate 50% of the price of buying a phone and 50% of the monthly cost of the phone would be expenses. There is no fixed regulation on this calculation. It is important to be able to explain reasonably about your calculation. And it is also important to keep the receipts or other certificate of all expenses. However, you need to be aware that unfairly calculating expenses will be illegal. In addition, for foreign residents, the sufficient amount of income to live is a requirement for many visas. Therefore, if an unfair calculation is made and income is reduced a lot, it is not only illegal, but it is not better for visas. Also, if people who need to receive financing as a loan do not have enough income, it may be difficult to borrow. In conclusion, it is important to calculate fairly and reasonably and save your income.

4. How can you make a tax inquiry?

I have briefly explained about the tax return. However, they are very basic things and it is normal not to understand very well about your own tax return. If you have any concerns or doubts about tax, you can go to the consultation at the tax agency. But, basically it is explained in Japanese. And maybe it seems that they don't give advice to reduce taxes. If you have any questions only about tax processing, it is good to consult with Zeirishi. If you have any tax and legal questions, it is good to consult with a lawyer.