Your First Tax Return as a Foreign Freelancer in Japan

First, check whether you must file

You generally must file if tax remains after you subtract your deductions from your income. This guide is for residents of Japan. See your tax status in Japan if you are unsure.

For tax year 2026, the basic deduction for residents is up to ¥1,040,000, depending on your income. Japanese health insurance and pension premiums you paid are also deductible.

If tax withheld from your fees covers all your tax, you need not file, but you can file to get the overpaid tax back. If you also have a salary, see who must file.

If freelancing is your main work and you keep records, your income is often business income (jigyo shotoku). Small side work may be miscellaneous income (zatsu shotoku), which cannot use a blue return.

Blue or white: a blue return rewards better books

A blue return gives a larger deduction, but it needs approval and better books. Without approval, you file a white return, which still requires records.

The deduction changes from tax year 2027. A paper return will get at most ¥100,000. Double-entry books with on-time e-Tax filing will get up to ¥650,000, or ¥750,000 with qualifying electronic records.

Send two forms early

Of the two tax office forms, the blue return application has the stricter deadline, so check it first. You send it only if you want a blue return. Both forms go to the tax office (zeimusho) for your address, by e-Tax (online), in person or by mail.

Your prefecture may also ask for its own business start form. In Tokyo, it is due within 15 days of starting.

For example, if you started on October 1, 2026, your application is due by December 1, 2026. If your two months have passed, file a white return for 2026 and apply by March 15, 2027 for 2027.

How to work out your income

Your business income is your sales minus your expenses, all in yen. Check these four points.

• Sales. Count the full fee before any withheld tax, generally in the year you finish and deliver the work, not the year you are paid.
• Foreign currency. Convert each amount into yen. The basic rule is your main bank's mid rate (TTM) on the transaction date. The National Tax Agency (NTA) allows some other methods if you use them every year.
• Expenses. Deduct the costs of earning the income. For rent, power or internet shared with home life, deduct only the business part your records can show. Equipment of ¥100,000 or more is generally deducted over several years.
• Withheld tax. Japanese businesses generally must withhold 10.21% from fees for certain work, such as writing, design, translation and lectures. On any part of a payment over ¥1 million, the rate is 20.42%. You subtract it from the tax on your return. It is not an expense.

Overseas clients paying from abroad generally withhold no Japanese tax, so set money aside for March.

Example: Maria's first return

In this example, Maria pays ¥54,600 for tax year 2026. She is a freelance designer in Tokyo and a resident all year. She started in January 2026 and applied for a blue return on time.

Her sales are ¥6,000,000. Japanese clients paid ¥1,000,000 of that, in payments of ¥1 million or less, with 10.21% withheld. She keeps double-entry books and files by e-Tax on time.

On a white return, Maria's income would be ¥650,000 higher, and she would pay ¥120,900.

Common mistakes

• Using bank deposits as sales. Deposits leave out withheld tax and can miss December work paid in January. Start from your invoices.
• Filing late because a refund is due. You can file a refund return for five years from the next January 1. However, the ¥650,000 and ¥550,000 deductions need a return filed by March 15.
• Treating overseas clients as foreign income. Residents generally report worldwide income. A non-permanent resident (a tax status, not a visa) has a narrower rule, but fees for work done in Japan are generally not foreign income. Royalties can differ.
• Forgetting next year's bills. A resident tax bill usually arrives around June. If the tax due on your return is ¥150,000 or more, you may also prepay income tax in July and November.

What you can do yourself, and where you need help

You can send the two forms and organize your records yourself.

• Save every invoice, receipt and payment record.
• List sales and expenses by month, in the original currency and in yen.
• Collect your insurance and pension records, and your withholding slip (gensen choshuhyo) if you had a job.

You need help when the answer depends on your facts. That includes your income type, the year a long or monthly contract counts in, and the business share of home costs. You may also want help with double-entry books.

What changes when a tax accountant handles it

A tax accountant turns your records into a filed return. Komatsu CPA & Tax Accounting Office helps individuals only, with Japanese tax only, and offers no calls. Our service runs by email in written English. Once you engage us, we do this work:

• Confirm your tax status and income type in writing.
• Convert foreign amounts into yen and check the year of each sale.
• Match the tax withheld to your invoices.
• Prepare your books from receipts and bank records, if you add bookkeeping.
• Prepare the Japanese return and send an English summary for your approval.
• Sign and file the return, then send you the filed copy.

With our English-language service, Maria's fee would be ¥48,000 base + ¥79,500 business income + ¥9,000 standard deductions = ¥136,500 (¥150,150 including tax). Bookkeeping is extra. This is only an estimate, based on the assumptions shown. Our minimum fee is ¥97,500 (¥107,250 including tax).

Frequently asked questions

This article is general information based on rules in force as of November 7, 2026. It is not advice for your situation.