Tax Troubles

So far, I have been able to live on non taxable income (scholarships, fellowships, etc). So I never had to learn much about how taxation works. But now that I am working “for real” (not that I dont consider PhD to be real work), I had to learn how the income tax (among others) work in my case.

As a Brazilian working in Japan as a professor, I actually have to option to pay either the brazilian or the Japanese income tax for two years. If I keep working in Japan for more than two years, then I have to pay Japanese I.T. anyway. It seems that this time limit varies with your job and nationality (probably based on international agreements).

So I since I have a choice, I had to research a bit. As for the tax amount, it is basically the same in both cases (around 20% of my salary). If I choose to pay taxes in Brazil, I need to send a notice to the japanese tax office about my decision, and pay my brazilian taxes directy to the brazilian government, yearly. On the other hand, if I decide to pay Japanese Income taxes, they will be deduced automagically from my salary, and I need to submit a form to the brazilian embassy stating that I have moved out of the country (along with a bunch of other info).

Since the values are about the same, I decided that it made more sense for me to pay the Japanese Income tax, since I should be staying here for the medium term. It was also generally less hassle. I was quite surprised about how much information about this is readily available online, though.

2 thoughts on “Tax Troubles

  1. Without taxes governments would be powerless and probably we’ll live in a jungle, but I still don’t like them!

    Inform yourself well about this issue. For example if you go back to Brazil in 5 or 8 years, does it count for retirement in Brazil the years of discounts in Japan. I know that if you leave Japan, you can get back the money relative to the discounts of two years (or at least the major part). All the best and happy discounting! It’s part of life.

  2. Hey Antonio, thanks!

    Actually, a new law was just passed this year that iallows Japanese contributions to nenkin to be counted against the brazillian retirement program. I still need to know what kind of forms I need to fill, but it seems to be a pretty straightforward process.

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