Filing a tax return by the deadline is an annual bane, but for many foreigners residing in Japan, it is even more headache inducing because of the language barrier.

Foreign nationals living and working in Japan are required to pay taxes in Japan. However, the tax return forms are only available in Japanese.

This year's income tax returns are due by March 15.

Some experts are concerned that the language barrier may even discourage some foreigners from paying their taxes.

On the morning of Feb. 16, the first day of the income tax filing period, taxpayers flocked to the tax filing area set up at the National Tax Agency’s Tokyo Regional Taxation Bureau in the capital’s Chuo Ward.

There were taxpayers who appeared to be foreign nationals, glancing around anxiously and consulting with the staff.

All the information boards were written only in Japanese.

Arbenita Sopaj, 30, was one of the foreigners looking to file her taxes.

Sopaj came to Japan from Kosovo in Eastern Europe about five years ago and is working as a university assistant.

She said the filing was “little bit difficult,” but the Japanese staff there who helped her “was very polite and made sure that I don’t have any difficulties.”

She is studying Japanese and understands some Japanese.

“So I think that was a very smooth process,” she said. 

Still, she added, “I think it would have been difficult” without the support from the staff.

Foreigners are subject to taxation if they earn income in Japan, and in some cases, they are required to file income tax returns.

According to the Justice Ministry, the number of foreign residents in Japan exceeded 3.22 million as of the end of June 2023, about 1.6 times the number of 10 years ago and a new record high.

However, the tax return forms and “e-Tax” electronic tax filing and payment system are available only in Japanese.

The National Tax Agency said it is “due to budget constraints that (the agency) has not yet been able to support other languages.”

Regarding tax forms, there are some barriers such as the optical character reader, which automatically reads handwritten text, is not designed for foreign languages, the agency said.

The agency has prepared manuals in five languages, including English and Chinese, that are available on its website’s tax return preparation sections.

The agency said it is working to create an environment that makes it easier for foreigners to file tax returns. But at this point, the agency is not considering making the tax return forms and e-Tax itself multilingual.

According to Toshio Nagashima, a licensed tax accountant at Sonderhoff & Einsel Law and Patent Office in Tokyo, who has long been involved in international taxation, many foreign residents in Japan used to work for Japanese companies or Japanese branches of foreign-affiliated companies.

That allowed them to entrust their tax affairs to major tax firms under contract with their employers.

“There may have been no need for tax return forms in other languages in the first place,” Nagashima said.

However, just as with the Japanese, the working styles of foreign residents in Japan are diversifying.

Unlike company employees, those who contract with a service operator as a sole proprietor, such as a delivery person for a food and beverage delivery service, must file their own tax returns.

Kazuko Sato, a licensed tax accountant who has an office in Tokyo’s Minato Ward, said, “I have sensed a latent need among foreigners who want to file tax returns.”

She saw a sudden increase in foreign clients last year after her firm was introduced on a website for foreigners as a “foreigner-friendly tax accounting firm.”

Julian Wick, a client of Sato, is a permanent resident of Japan and has lived in the country for more than 50 years.

Wick is required to file a tax return reporting his pension and dividends from stocks he holds in a U.S. brokerage firm.

He understands the meaning of the Japanese words on the tax return forms, but he said he can’t file the return himself because of his superficial knowledge of the language.

He said he is fortunate to have found Sato.

Specialized tax knowledge is required for foreigners to avoid double taxation with their country of origin, and also because the scope of taxable status changes depending on the period of residence in Japan.

“Taxation is difficult even for Japanese people,” Sato said. “It is important to be able to connect any foreigner to an appropriate contact point, including tax accountants.”

Sato added, “Some foreigners may lose their motivation when tax return forms are only available in Japanese. Multilingualization is the first step to encourage them to pay their taxes.”