Tax Audits in Japan


Foreign residents in Japan are subject to the same tax filing and payment requirements as Japanese citizens. This means that your tax returns may be subject to audit by the Japanese tax authorities.

Generally, the audit period covers the past three years, but if there are suspected irregularities in your tax returns, you may be audited retroactively for seven years. During an audit, you will be required to provide evidence that your tax returns are accurate.

If you are a foreign national living in Japan and are audited by the Japanese tax authorities, you may be dissatisfied with the results of the audit due to Japan’s complex tax laws and business practices.

In many cases, even Japanese citizens have difficulty understanding how Japanese tax laws apply.

Some foreigners who are not satisfied with the tax authorities’ disposition may file a lawsuit.

Since the reasons for dissatisfaction among foreigners living in Japan may stem from a lack of mutual understanding, it is wise to consider hiring a Japanese tax accountant to negotiate with you if you are troubled by a tax audit, rather than dealing with the situation on your own.