The government has introduced a special income tax deduction for 2024 called the “Flat-Amount Cut.”
This section explains the new income tax deduction, specifically for those who need to file an income tax return that includes business income or other qualifying types of earnings.
1.Who is eligible for the Flat-Amount Cut?
Residents who are taxpayers in 2024 with a total net income of 18,050,000 yen or less (after deducting necessary expenses from each income source) are eligible for this deduction.
Note: The term “resident” refers to an individual who has a domicile in Japan or an individual who has maintained a residence in Japan for at least one consecutive year up to the present.
Non-residents, defined as individuals who do not meet the resident criteria, are not eligible for the Flat-Amount Cut.
2.How much is the deduction?
The amount of the special income tax deduction is the total of the following amounts.
If this total exceeds the taxpayer’s income tax liability, the deduction will be limited to the total amount of income tax owed.
- Taxpayer: 30,000 yen
- Spouse and dependent relatives in the same household with a total net income of 480,000 yen or less (all must be residents): 30,000 yen per person
Please note:
- Dependents under 15 years old who do not qualify for the dependent exemption are still eligible for this deduction.
- However, a spouse or dependent who is employed in a family business by a taxpayer filing a blue or white return is not considered a qualifying spouse or dependent relative for this purpose.
Eligibility for spouse or dependent status is determined based on the individual’s status as of December 31 of the relevant year. However, if an individual changes from resident to non-resident without appointing a tax agent, their eligibility depends on their status at the time of departure from Japan.
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