Tax and side job

Hello

I know there are a lot of similar questions to mine in the past forum questions, but there are some small things that I would like to confirm so I would like to post this question here.

I am a Master's Degree graduate from a university in Japan and will be getting my first job in Japan in a small IT/Application firm, working as a translator and later, customer support for Southeast Asia region (I am from Malaysia). My salary is set at 208,000 yen per month which includes 40 hours of overtime (so overtime is not paid). I felt this salary is a little low but I am unsure about the market price. Can anyone advise me about it? The salary review in this company is every quarter, so I would like to see if I can make a pitch for a higher salary.

My second question is about side-jobs. I have been teaching English part-time during my student years and really enjoyed it. I would like to continue doing it and recently a language school contacted me about a two-hour class every Saturday. My question is, how will this income be taxed? Will my company find out about it through the tax office? Should I tell my employer? Will the tax be done together with my main job, or I have to file tax separately? I am really a beginner about taxes in Japan as for now all my English classes are private and cash-based so I never have to declare anything. It is my first time to be employed by a proper school.

Would be glad if anybody can enlighten me about my situation.

If side earnings less than 200,000 per year, no need to declare.

Otherwise, just file it in a tax return so keep all the documents from the extra job. Will they be doing tax withholding? or is it cash in hand? If it is just cash in hand job, many people in this situation just keep it all and don't declare to the tax office.

Your employer won't find out via the tax office.
Your contract may require that you need permission for outside work. Whether or not you obey this is up to you.

The English school said it's not cash in hand. When you say 200,000, is it per year? If it's per year I think I might be over the limit.

When you say withholding tax, you mean my main company or the English company?

"My salary is set at 208,000 yen per month which includes 40 hours of overtime."
it seems to be illegal way of the salary determination.
salary should be decided without overtime working ( 40 hrs per week is maximal). if you work more than 40 hrs per week, the employer have to pay 25% increased salary for the overtime work.

according to the above point, your current employer is not a good company. you may consider to find another company.
(that the salary is high or low is not the point. the company, which do not follow the labor laws, will violate other laws possibly.)

how will this income be taxed?
the salary of your side job will be taxed 10% or about 3% by the eikaiwa school. ( if your work is a reward, then 10%. if your work is salary, then 3 %.)

If side earnings less than 200,000 per year, no need to declare.
that is not 100% correct. it is illegal, if eikaiwa school pay money without tax deduction. you will get a tax-deducted amount.

all employers have to report the paid salary to tax office and city office every year. therefore, both offices will know your income. I think, especially city office will tell you that you have to declare your combined income. (because you did not pay local tax of your side income.)
the employer will finally know you have a side income, if you file your total income either to tax office (national tax) or city office (local tax).

It depends on your age, work experience, qualification and where you live, but I think about 210,000 Yen include over time work is a bit low. But there is no an average salary rate in IT industry.

If you earn more than 200,000 Yen exclude expenses incurred, you need to fill a tax payment form of "Kakutei-shinkoku" between mid-Feb and mid-Mar. If your par-time employer already paid your income tax, you can be expected to return some of tax refund, or, you need to pay an extra income tax other than the salary from IT while the part-time employer didn't pay your income tax at all.
It's normally a part-time income is not taxable. so I recommend you to check the part-time employer or on your payment slip you get from part- time.

About the salary, I see. Can I know which part of the labor law that states that it is illegal? Is there some website I can check?

Yea I know it's not a very good company when I look at the compensation, but after a year of job hunting, it's the only offer I get so for now I guess I have to stick with it while keeping my options open.

About the tax, so I guess I will have to tell my main employer about my side job because they will find out anyway right?

If your full time work company has labor unions, ask them first for your work environment. But majority of IT companies don't have labor unions.
or, report to labor standards bureau(Roudou-kijunkyoku) for your work issue. They might investigate your work environment and report to the head officer to improve their work load.

You don't need to ask your full time company about the part-time job unless you get the job from full time work company.
Your earning from part-time jobs won't normally deducted income tax.

No there is no Union. It's just a small company with about 64 people in it working.

I think you better to find the other job in JP or back to your home country if you don't satisfy with your salary.

Hahaha that's not a very helpful and constructive advise

Hahaha that's not a very helpful and constructive advise

I don't know the IT industry, but consider that might actually be some really good advice to consider. Definitely be cautious of a job that may be underpaying and/or participating in sketchy business practices. At least you're trying to check it out and compare to other companies in the industry.

I ask important question. Which visa you are holding? If you hold visa for translation and interpretations then you are not supposed to do the outside activities. If you want to teach english as a part time on this visa, then take a permission from immigration.
But if yo are on spouse visa, there is no problem.

If you area teaching part time in your home, no problem.
If you are teaching through other school then check with the school.

As some other person mentioned, check the contract of your main work, does it allow you to do other activities?

If your part time earning is less than 60man or 100man yearly. Then you dont need to pay tax. Check earning limit in your situation.

I will be holding a Specialist in Humanities / International Services visa. Is that the same visa for English teachers in language schools?

Well I have not looked at the contract yet as I will only start working in June. I will check with my company. If they don't allow it of course I will quit the side job and only maintain my private one-to-one cash basis jobs only.

Yea I am looking around for other jobs. But since my main point is to remain in Japan and until now this job is the only job offer I manage to get, I will be here for at least half a year before I start looking around again. But since their salary revision is 4 times a year, I would just like to know how much I can pitch for a higher salary.

Thanks

Setting a salary including a limited number of overtime hours is legal as long as either the overtime pay amount in yen or the number of overtime hours is clearly indicated. So saying something like "base salary of 208,000 yen (including 40 hours overtime per month)" or "base salary of 208,000 yen (including 40,000 yen as assumed overtime pay)" is OK, as long as overtime work beyond that number of hours will be paid, and the per hour pay does not fall below the minimum wage.

If I take the minimum wage for Tokyo, which is 888 yen per hour,
For regular work hours, if I assume certain number of hours and days: 888 yen x 8 hours per day X 23 days in a month = 163,392 yen
Overtime pay included: 888 yen X 1.25 X 40 hours = 44,400
If you add them together: 207,792 yen.

So yes it seems to be legal. The number almost looks like the company knew what they were doing.


For your side job, first check if your contract with them allows a side job. As described earlier, if your annual income from the side job exceeds 200,000 yen, you will need to do your tax filing.

(7)　基本給に○○時間分の残業代を含むとした場合の有効性
　「基本給には，４５時間分の残業手当を含む。」といった規定の仕方も広く行われており，一応，通常の労働時間の賃金に当たる部分と残業代に当たる部分とを判別することができるといえなくもありませんが，「４５時間分の残業手当」が何円で，残業手当以外の金額が何円なのかが一見して分からず，方程式を解くようなやり方をしないと，通常の賃金に相当する金額と残業代に相当する金額を算定できなかったり，４５時間を超えて残業した場合にどのように計算して追加の残業代を計算すればいいのか分かりにくかったりすることがあるため，合意の効力が否定されるリスクが比較的高いと言わざるを得ません。

There will be some legal experts that might argue that way [that "the risk that the validity of such agreement (that is, the validity of an employment agreement that says the base salary includes overtime pay for XX hours) might be denied is relatively high"]; however, it has been a recent practice among some corporations to enter into agreements in this way, particularly among IT companies.

And I would imagine that this legal opinion was given in respect to a lawsuit - where the employee demanded payment for overtime BEYOND the included number of hours, and the company either refused, or said that it was impossible to calculate.

Still this type of agreement is not right out illegal nowadays, though unfortunate.

http://www.bengo4.com/topics/2666/

must separate between 基本給 and 固定残業代.
since the OP will start working in June, he/she does not have a chance to look at 労働条件通知書.
the company is a bad one, so called "ブラック企業" in Japanese. it is not a company where a normal person works.

to the OP,
do you want to work in minimal wage after you got the master's degree ?

Thank you for the advise. I will keep track of the hours I work and make sure I'd never go over 40 hours, and of course, working on a minimum salary after getting a Masters is not ideal, but I don't have a choice now. However, I did not plan to work here for long if they do not improve my salary during the revision. I will keep my options open.,.

I have looked at some sites regarding taxes and found that they calculate per year from Jan-Dec and then file it in March. Since I just started this side job, this year it will not go over 200,000 yen. So does it mean I don't have to file it for this year?
Maybe next year if I do it for a full year, then I will need to do tax filing...

You said it wasn't cash in hand. So if the are paying you properly they should be withholding taxes already. Filing would make more sense in that case.