RetireJapan

Charitable contributions

Charitable contributions designated by the Ministry of Finance in Japan are tax deductible, with certain limitations. Qualified contributions or donations that total, in aggregate, over JPY 2,000 are deductible in computing the national tax. The total deduction is limited to 40% of income, less JPY 2,000. The definition of a qualified contribution is extremely restrictive.

You may deduct from your income a certain amount when you made donations to national government, social welfare juridical person, certified NPOs (*1)(excluding the ones related to admission to schools), made hometowntax(donations to prefectures or municipalities)(*2),expended to acquire stocks issued by special new small and medium enterprises, certain political donations, and to trust for certain specified charitable trusts.

*1When filing a final return, you must include the amount of hometown tax payment in the deduction for donation, even if you have submitted an application for "Hometown Tax Payment One-Stop Special Procedure System."(refer to page 17)

*2 Certified NPOs, etc. indicate non-profit organizations certified by competent authorities (a prefectural governor or the head of a designated city) (including NPOs with special certification (provisional certification)) or former certified NPOs that were certified by the NTA Commissioner.A list of certified NPOs,etc. is available on the website of the Cabinet Office (https://www.npo-homepage.go.jp/).

*3If you have made certain contributions to a political party or political organization, donation to a certified NPOs or public interest incorporated association, etc., you may choose from special credit for contributions to political parties, special credit for donation to certified NPOs, special credit for donation to public interest incorporated association, etc. respectively or deduction for donations, whichever is most beneficial.Which of these choices will be most beneficial depends on the amount of your income, political contributions, donation and other factors. So, please prepare and confirm your "detailed statement and calculation form for special credit for political contributions," "detailed statement and calculation form for special credit for donation to certified NPOs," or "detailed statement and calculation form for special credit for donation to public interest incorporated association, etc...)