RetireJapan

According to information I found on the NTA website, it seems possible to claim a dependent deduction of ¥380,000 (per dependent), even if they live overseas: https://www.nta.go.jp/m/taxanswer/english/12016.htm

Does anyone know whether or not it's possible to use something like Transferwise for remittances in such a way that these would be recognised by the NTA? I'm not sure whether or not Transferwise would be acceptable after reading the footnote, "fund transfer businesses as defined under Article 2, paragraph 3 of the Payments Services Act.".

Any ideas?

No specialist knowledge but I can’t see why Transferwise wouldn’t qualify. I have a couple of Japanese friends who use it to receive payments for their business so it’s clearly well known here.

Some factors/details:

https://www.reddit.com/r/japanlife/comm ... _means_to/

Thanks for the responses.

captainspoke wrote: ↑Sun May 24, 2020 1:54 am Some factors/details:

https://www.reddit.com/r/japanlife/comm ... _means_to/

Just to be clear, the money I'm transferring overseas is for an actual dependent. I don't cheat on my taxes.

If, though, what you meant was that Transferwise requires My Number and therefore should be recognised by the NTA, then you might be right. I think I'll give the NTA a call to double-check because if, for whatever reason, Transferwise isn't acceptable in their eyes, then I would rather switch to making direct bank transfers and take the hit on FX/fees but gain by way of the tax deduction.

Transferwise can be safely used. I have been using it for transferring money to my dependents since last 2 yrs and have submitted same as proof for tax deductions. No issues from taxation purpose.
Make sure you directly deposit to dependent's account.

akizoid wrote: ↑Fri May 29, 2020 10:33 pm Transferwise can be safely used. I have been using it for transferring money to my dependents since last 2 yrs and have submitted same as proof for tax deductions. No issues from taxation purpose.
Make sure you directly deposit to dependent's account.

Great! Thank you very much for this, it's exactly what I wanted to know

lifesideways wrote: ↑Fri May 29, 2020 3:44 pm Thanks for the responses.

captainspoke wrote: ↑Sun May 24, 2020 1:54 am Some factors/details:

https://www.reddit.com/r/japanlife/comm ... _means_to/

Just to be clear, the money I'm transferring overseas is for an actual dependent. I don't cheat on my taxes.

If, though, what you meant was that Transferwise requires My Number and therefore should be recognised by the NTA, then you might be right. I think I'll give the NTA a call to double-check because if, for whatever reason, Transferwise isn't acceptable in their eyes, then I would rather switch to making direct bank transfers and take the hit on FX/fees but gain by way of the tax deduction.

No special meaning implied in my linking to that reddit post--it was there, recent, and a similar question.

*

You might explore if there are limits/suggestions on transfer amounts. Is it better somehow to make monthly, quarterly or semi-annual transfers? Or would a single, larger transfer per year be acceptable? If the latter, then I'd guess that a bank transfer would be cheaper (and better f/x) than transferwise.

captainspoke wrote: ↑Sun May 31, 2020 10:06 am You might explore if there are limits/suggestions on transfer amounts.

The limit is currently ¥1m per transfer, if using Transferwise, but not sure about other services and corresponding laws. If I were to make monthly transfers, then the amount per transfer would be much less than that.

captainspoke wrote: ↑Sun May 31, 2020 10:06 am Is it better somehow to make monthly, quarterly or semi-annual transfers? Or would a single, larger transfer per year be acceptable? If the latter, then I'd guess that a bank transfer would be cheaper (and better f/x) than transferwise.

This is also something I've thought about, but am wary of big banks charging outrageous hidden fees — if you (or any others here) have some insight into good options for large transfers, then I'd be grateful if you could share your knowledge, especially if you know whether or not quarterly or yearly transfers for the purpose of supporting dependents are seen as acceptable by the NTA

I have used (Transfer)Wise, WorldRemit and lately Revolut. All work, we’re accepted by NTA. All seem to have the ¥1M limit, but at least Revolut is free for 750k/month. Though read the Revolut conditions carefully and don’t load with a credit card but bank transfer.