Taxes when a permanent resident lives abroad

[dreadpierat]

Hello,

I'm a US citizen pursuing permanent residency in Japan.

Simple question: Let's say I obtain permanent residency, but then move back to the US, and work exclusively in the US, and don't send any of my money back to Japan. During the years that I'm living and working exclusively in the US, am I required to continue paying any Japanese taxes? (The idea is that I will eventually return to Japan again after living in the US.)

I've read that permanent residents are required to pay taxes on overseas earnings. But in the situation I'm describing, I would possess a permanent residency visa, but would not be actually residing in Japan or sending money there.

Thanks!

[adamu]

I obtain permanent residency, but then move back to the US, and work exclusively in the US, and don't send any of my money back to Japan. During the years that I'm living and working exclusively in the US, am I required to continue paying any Japanese taxes? (The idea is that I will eventually return to Japan again after living in the US.)

Good question. There is an article on the wiki about this that might be a good start. https://retirewiki.jp/wiki/Residency_for_tax_purposes

You will also need to get a re-entry permit before you leave Japan if you stay out for for more than 1 year, otherwise you will lose the PR status. Info about that here: https://retirewiki.jp/wiki/Permanent_re ... iderations

[RetireJapan]

You probably won't owe Japanese taxes if you are not resident, but it then becomes a question of whether you are entitled to permanent resident if you are not residing in Japan (this is very unclear from what I have read).

[Tkydon]

I reiterate Adam's point about the Re-Entry Visa.

Many people with PR left Japan before Covid, thinking they would come back within 12 months, so did not get the Re-Entry Permit from Immigration, but just used the Special Re-Entry Permit Checkbox on the Embarkation Card at the Airport.
They then could not get back within the 12 month validity of the Special Re-Entry Permit due to Covid Lockdown and now have problems to apply for a new Visa, and hopefully reactivate their PR.

Get the Re-Entry Permit from Immigration. It will be valuable for 5 Years, or until your Zairyu Card expires. You will have to come back from time to time to renew them.

Permanent Residence for Immigration Purposes (Visa) is not the same as Permanent Residence for Tax Purposes (5 Years in Japan in the Last 10 Years), but maintaining your Permanent Resident Visa does indicate your desire to maintain your Tax Domicile in Japan.
You should do some websearches on Tax Domicile and Dual Domicile.

It depends on how the Tax Office decides to interpret your situation, whether they consider you Off-Shore and not taxable in Japan for the period of your absence or still tax your Global Income, especially if you or your family maintain a home for your use here (Rented out is not available for your use...). You probably need to consult with a Tax Professional with experience in this area.

Even while you are away, you will still be liable to pay your Residents' Taxes for the period before you left, which are paid in arrears (Residents' Taxes for 2022 will be payable between June 2023 and May 2024).
You will need to appoint a Tax Representative to handle your taxes while you are out of the country.

[captainspoke]

Hello,

I'm a US citizen pursuing permanent residency in Japan.

Simple question: Let's say I obtain permanent residency, but then move back to the US, and work exclusively in the US, and don't send any of my money back to Japan. During the years that I'm living and working exclusively in the US, am I required to continue paying any Japanese taxes? (The idea is that I will eventually return to Japan again after living in the US.)

I've read that permanent residents are required to pay taxes on overseas earnings. But in the situation I'm describing, I would possess a permanent residency visa, but would not be actually residing in Japan or sending money there.

Thanks!

There's a somewhat similar question with a response here. Scroll down to the final three posts--the question and then the reply.

From that, it seems that if you leave with the intention to stay gone for at least a year, your tax residency ends pretty much immediately. Here's the 'meat' of the reply there:

Normally, leaving for at least one year would mean you lose tax residency immediately (the day after departure), meaning that your kid would (should?) have had a year-end adjustment done for them by their employer in mid-Feb 2022 and would not have any further Japanese tax obligations until they start living in Japan again. If they didn't have a year-end adjustment done by their employer then they would need to file a Japanese tax return for 2022, but only covering the income they earned prior to departure.

The person saying that, whose posting name is starkimpossibility, is really good/reliable.