RetireJapan

Basically, when submitting my JP tax papers early next year am I able to include my UK National Insurance contributions paid this year in my deductions section, alongside my JP pension and Ideco contributions?

Since being accepted as being able to backpay class 2 NICs in March this year I have made payments totalling close to £1600 (so close to 31万円) to completely pay all I was entitled to backpay.

If relevant all of this £1600 was paid from my own funds already held in the UK, no JPY-GBP transfer was made. Also I'm a permanent resident for tax purposes, and currently receive my income from within Japan only.

My gut tells me I will probably be unlikely to be able to claim this on my Japanese Tax return, but due to the shared tax agreement between JP-UK perhaps there may be a possibility...

You can claim all payments in 2024 as a tax deduction. You have to convert the GBP value to Yen on the day(s) you made the payment(s).

They will then be deducted from your Taxable Income, so that money will be Tax Free.

If you have had tax withheld on income through the year, then you will get a Refund at your Marginal Tax Rate of the tax you paid through the year on your income.

So, if you paid GBP 1,600 at say Y200 to the GBP = 320,000, then you could expect a Tax Refund

Tax Refund = 320,000 / Marginal Rate of Income Tax and Reconstruction Surtax - 320,000

Marginal Rates of Income Tax and Reconstruction Surtax, depending on your total taxable income level
5.105%
10.21%
20.42%
23.483%
33.693%
40.84%
45.945%

Exchange Rates here:
https://www.murc-kawasesouba.jp/fx/past_3month.php

Tkydon wrote: ↑Sat Nov 30, 2024 1:30 pm You can claim all payments in 2024 as a tax deduction.

Are you sure about that? It's a voluntary insurance payment, not a foreign tax payment, right?

The NTA’s criteria for social insurance deductions is published here:

https://www.nta.go.jp/taxes/shiraberu/t ... u/1130.htm

#14 is limited to compulsory social insurance contributions paid to a foreign country under the conditions of a tax treaty. Voluntary UK NICs fall outside of this. So my understanding is that no deduction is applicable.

An interesting one, but I would go for a 'No' but maybe worth further investigation. I am going ask my accountant about this.

I presume there’s also no deduction possible for U.K. student loan repayments?

kuma wrote: ↑Sat Nov 30, 2024 11:46 pm So my understanding is that no deduction is applicable.

I came to the same conclusion when I checked it. Not 100% sure but I don't think we can claim deductions for voluntary NI payments.

Gareth wrote: ↑Sun Dec 01, 2024 3:38 am I presume there’s aerelso no deduction possible for U.K. student loan repayments?

Again an interesting one.... Maybe the interest you pay....

Thanks all for the replies. I'll do more searching myself, but as initially felt it seems a "no" is more likely.

However,

Wales4rugbyWC23 wrote: ↑Sun Dec 01, 2024 12:28 am I am going ask my accountant about this.

I'm sure we'd all be very interested to hear what you acccountant's opinion is in due course...

Wales4rugbyWC23 wrote: ↑Sun Dec 01, 2024 8:43 am

Gareth wrote: ↑Sun Dec 01, 2024 3:38 am I presume there’s aerelso no deduction possible for U.K. student loan repayments?

Again an interesting one.... Maybe the interest you pay....

Over COVID my wife did a correspondence Masters in TESOL from a Polish University. My accountant said it was acceptable for the tuition fees to be a business expense, because we run a school.