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How to Reduce Your Taxes


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As mandated by the law, an employed person is obliged to pay taxes accordingly. Whether you have a white or blue collar job, your regular salary is deducted for a certain percentage as computed based on your taxable income. However, there are certain instances when an employee is entitled to a reduced tax.

1. Making a donation – In Japan, earthquake is a common calamity. In the event that you have donated some money to a charitable institution or a rescue group that helps people devastated by any natural disaster, you are entitled for a tax reduction.

2. Medical expenses – If you have an accumulated medical expense of at least 100,000 yen or 5% of total income, you are entitled to a reduced tax provided that you meet these criteria : the maximum amount is at 2,000,000 yen and that the accumulated expenses was paid in cash. This tax deduction can be filed between January to March 15 of every year.

3. Made a loan – If you have purchased a new house, you can get a tax discount of 1% based on the remaining loan amount for a period of 10 years. Note that this is only applicable to residential houses and not to rental and vacation homes.

It is very important to noted that, to get any of these tax reductions, it should be filed appropriately by the person employed. In addition, it is expected that appropriate documents are submitted and the right forms be accomplished.

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