Japanese Taxation. How Foreign Nationals and Foreign Corporations Pay Taxes from Abroad

Introduction

This section describes specific methods for foreigners and foreign corporations without accounts at Japanese domestic banks to pay Japanese corporate and consumption taxes.

If you have an account at a Japanese bank, you can pay your taxes through the bank’s Internet banking system.

For details, please refer to the National Tax Agency’s page below.

National Tax Agency: Payment Procedures Available from Outside Japan

Payment on behalf of a third party, such as a tax agent

A tax agent is required for foreign nationals and foreign companies that do not have an office in Japan. A tax agent is a person who performs the following tasks for an overseas non-resident.

• Preparing and submitting tax documents
• Payment of taxes and receipt of refunds
• Receipt of documents from the tax office

The easiest way for a foreigner or foreign company to make tax payments would be to use the tax administrator’s bank account to make payments on their behalf.

The tax agents may only be willing to make payments on your behalf if the relationship is close.

Anyone can pay a taxpayer’s taxes on behalf of the taxpayer, even if they are not a tax agent. There is no particular procedure for making a payment on behalf of a taxpayer.

Credit card payment

Credit card payment is recommended if you do not have an account at a financial institution in Japan. The disadvantage is that there is a handling fee. The fee depends on the payment amount, which can be checked from the link below.

National Tax Credit Card Payment Site

Credit card payments can be made in the company’s name, the representative’s name, or anyone else’s credit card.

The advantages are that the procedure is easy and quick, and English is supported.

The disadvantage is that some terms, such as tax type, taxable period, and declaration category, may be difficult to understand for those with no knowledge of taxation.

Credit card payment charge

The following is an example of a credit card payment site.

Remittance

Payment can also be made by remittance from an out-of-country bank to the tax office’s bank account.

This method’s disadvantage is that it is complicated and requires communication in Japanese via telephone and e-mail with the National Tax Agency staff.

The bank that remits the funds will charge a fee, and the Japanese bank that receives the funds will charge a fee. The Japanese bank’s fee is estimated to be about 3,000 yen.

Suppose you transfer funds to the tax office’s bank account using a fund settlement service such as Wise, WorldFirst, or PayForex. In that case, the tax office will refuse to accept the funds. Moreover, even if you try to get a refund of the rejected funds, both the tax office and the fund settlement service refuse to cooperate, which can lead to trouble in some cases. The tax office’s website does not mention such an explanation, which is problematic.

Summary

It is easiest for foreign nationals and companies if a third party, such as a tax agent, can pay on their behalf.

In practice, credit card payment is recommended.