RetireJapan

Hi everyone, I'd like to ask about transferring large sums from my UK bank to my bank in Japan. I'm getting ready for a house purchase here, and I'll need to transfer around £120,000. I'm concerned about being hit for tax here in Japan. Also, I don't want to have trouble with my Japanese bank when such a large sum appears in my account. Any advice or experiences would be very welcome. Has anyone on this forum done this? I wonder if breaking the total sum up into smaller amounts would be better. If so, does anyone have any advice about how much I could transfer at one time without getting a phone call from my bank here or an enquiry from the tax office? Any help gratefully received!

Breaking transfers into smaller amounts in order to avoid scrutiny is illegal in many countries and likely to attract attention

The tax office may ask you to prove where the money is from and whether you owe tax on it. Assuming you don't, there isn't much to worry about there.

Same with your bank in Japan. 'I'm transferring my savings to buy a property' is quite a common reason and shouldn't cause you much trouble.

Thanks very much for this sound advice. If I do transfer one lump sum and give the property purchase as the reason, does the tax office in Japan contact me directly on its own initiative? Thanks again.

novalis wrote: ↑Fri Mar 18, 2022 9:30 am Thanks very much for this sound advice. If I do transfer one lump sum and give the property purchase as the reason, does the tax office in Japan contact me directly on its own initiative? Thanks again.

They may, they may not. The bank will, in my experience, certainly contact you. Are you worried about anything specific tax wise?

Beaglehound wrote: ↑Fri Mar 18, 2022 9:34 am

novalis wrote: ↑Fri Mar 18, 2022 9:30 am Thanks very much for this sound advice. If I do transfer one lump sum and give the property purchase as the reason, does the tax office in Japan contact me directly on its own initiative? Thanks again.

They may, they may not. The bank will, in my experience, certainly contact you. Are you worried about anything specific tax wise?

I transferred about half that about 13 years ago in about four instalments for exactly the same reason and I got a letter from the tax office. I told them what it was for and didn't hear anything more from them.

Every time you cross the border, you will notice on the Customs Declaration Form when entering the country (many countries, I think), that you have to declare if you are carrying financial instruments in excess of; US - US$ 10,000, Japan - JPY 1,000,000, GBP 10,000, etc..

Transfers in excess of these values will definitely be flagged.

However, transfer of Funds does not necessarily constitute an Income Event and therefore a Taxable Event, if there was not an Income Event in the Tax Year.

If there is an Income Event in the Tax Year, only the amount of the Income or Capital Gain in the Tax Year is taxable and not the full amount.