Japan — Non-Permanent Resident (5 Years in 10)

Summary

Limit

5 years of domicile or residence

Window

The preceding 10 years

Tracked as

1,825 domicile days in the last 10 years (trips abroad included)

Status while under

Foreign-source income paid abroad taxed only on remittance

Status once over

Ordinary resident — worldwide income

Applies to

Non-Japanese nationals only

Basis

Income Tax Act; NTA Income Tax Guide §1-3

A non-permanent resident is a Japanese tax resident who is not a Japanese national and whose aggregate domicile or residence in Japan is 5 years or less within the preceding 10 years. While that holds, foreign-source income paid abroad is taxed only when remitted to Japan. Once five years have elapsed you become an ordinary resident, taxed on worldwide income. The crucial detail: the law counts periods of domicile or residence, not days you were physically present — so time abroad while your home stays in Japan still counts against you.

Who it applies to

This matters most if you are:

• A foreign national who moved to Japan and is approaching the fifth anniversary.
• Holding foreign investments, foreign rental income, or foreign employment income paid offshore.
• Planning a remittance to Japan — a property purchase, a school fee — from offshore funds.
• Returning to Japan after years away, wondering whether the old years still count.

It applies only to non-Japanese nationals. If you hold Japanese nationality you are an ordinary resident from the moment you are resident at all, and this article is not your rule — see Japan tax residency for the underlying domicile test.

The rule — and why it exists

Japan splits residents into two classes. The NTA guide defines a non-permanent resident as a resident who does not hold Japanese nationality and who has had a domicile or residence in Japan for an aggregate of 5 years or less within the preceding 10 years. The scope of taxation follows:

• Income other than foreign-source income — taxable in full, wherever it is paid.
• Foreign-source income paid in Japan — taxable in full. This is the limb people forget: being a non-permanent resident does not shelter foreign income that lands in a Japanese account.
• Foreign-source income paid abroad — taxable only to the extent it is remitted to Japan.

The flip is sharp: NTA Basic Circular 2-3(3) treats you as non-permanent up to the day the five years are reached, and as an ordinary resident from the following day. Bounded counts domicile days, not days present: every day since your domicile began, trips included, with 1,825 allowed in the last ten years — so it warns up to three days before the five years are reached.

Why it exists: Japan wants to attract foreign talent without immediately taxing the worldwide wealth people bring with them. Five years is the grace period; after that you are treated like any other resident.

Counting the time

Read this section carefully, because a simple count of days present and the statute measure different things.

1. 1The statute aggregates periods during which you had a domicile or a residence in Japan — calendar time, not presence.
2. 2Those periods are summed across the preceding 10 years, so time more than a decade old drops out of the window.
3. 3A period of domicile keeps running while you travel: business trips, holidays and even long postings do not subtract, as long as your home in Japan persists.
4. 4Bounded follows the statute here: it counts every day since your count-from date, which it needs before it shows a number, so trips abroad keep the clock running as they do in law.
5. 5Set the counter's count-from date to the day you moved to Japan — or, if you lived in Japan more than once in the last ten years, to your first move.

If you have lived in Japan continuously since the move, the honest answer is simple: your status flips on the fifth anniversary, and the counter warns up to three days before it. If you gave up your Japanese home, left and came back, the counter still counts the time away, so it warns early: add up the periods within the last ten years yourself for the true date.

Examples

Example 1 — the straightforward case

Elena moves to Tokyo in March 2022 and keeps an apartment there throughout. In March 2027 five years have elapsed: she becomes an ordinary resident, and her foreign dividend income becomes taxable in Japan whether or not she remits it. A count of days present would show only about 1,600 because of her frequent travel; Bounded counts domicile days, so it warns just before the March 2027 anniversary.

Example 2 — the remittance that was taxed anyway

Sam, a non-permanent resident, receives consulting fees from a Singapore client into his Japanese bank account. He assumes non-permanent status shelters it. It does not: foreign-source income paid in Japan is taxable in full for non-permanent residents.

Example 3 — the 10-year window resetting

Rahul lived in Japan from 2013 to 2016, left for Dubai, and returned in 2026. By 2026 the 2013–2016 period has largely dropped out of the preceding-10-years window, so his aggregate is small and his non-permanent clock effectively restarts from the return.

Exceptions & edge cases

• Japanese nationals are excluded. Non-permanent status is available only to non-Japanese nationals, however recently they arrived.
• Remittance is broader than a bank transfer. NTA Basic Circular 7-6 also counts bringing cash or cheques into Japan, carrying in precious metals or securities instead of a transfer, and borrowing or having costs paid in Japan that you then settle from accounts abroad. An ordering rule then deems each year's remittances to come first from non-foreign-source income paid abroad, and only the excess from foreign-source income paid abroad (Income Tax Act Enforcement Order art. 17(4)).
• Employment income split across countries. Where duties are performed partly outside Japan, apportionment rules decide what is foreign-source in the first place — the non-permanent shelter only operates after that question is answered.
• Interrupted residence. If you gave up your Japanese home entirely and lived abroad, that gap genuinely does not count. The counter cannot see when you gave up your home and keeps counting, so it warns early; for a broken history add the periods up yourself.
• How the NTA adds periods. Strictly, Basic Circular 2-4-3 counts each period by the calendar from the day after you arrive to the day you leave, and adds separate periods as years, months and days (30 days make a month, 12 months a year); the 10-year window runs from the same date ten years earlier to the day before the date being tested (Circular 2-4-2). Adding separate periods this way can differ from a plain day total by a few days either way — leave a margin.

Common misconceptions

• "Days outside Japan pause the five years." No. The law counts periods of domicile or residence, not physical presence. Travel does not buy you extra non-permanent years.
• "Non-permanent means no tax on foreign income." Only on foreign-source income paid abroad and not remitted. Paid in Japan, or remitted, and it is taxable.
• "It is 5 years of tax filings." It is five years of domicile or residence within the preceding ten — a rolling look-back, not a count of returns filed.
• "The counter is the answer." Only with a continuous home in Japan, where it warns up to three days before the fifth anniversary of the move. After a break in residence, check the aggregate yourself.
• "This is the same as the 183-day rule." Japan has no 183-day rule at all — see Japan tax residency.

Frequently asked questions

Sources

• National Tax Agency — Basic Income Tax Circular 2-3 (resident / non-permanent resident classification)
• National Tax Agency — Basic Income Tax Circular 7-6 (scope of remittance)
• National Tax Agency (NTA) — Income Tax Guide 2025, §1-3 (residents, non-permanent residents, scope of taxation)
• National Tax Agency — Income tax information for foreign residents