Most "leaving Japan" tax worries are small. This one isn't — it can be a seven-figure yen bill on money you never actually received, because you never sold anything. But it's also narrow: it only bites a specific profile. Mio doesn't do fear; Mio checks the two gates and tells you plainly whether you're inside the box or not.
Introduced in the 2015 tax reform and applying to departures on or after 1 July 2015, Japan's exit tax (formally the "special provision for capital gains etc. when leaving Japan," kokugai tenshutsu o suru baai no jōto shotoku-tō no tokurei) treats certain residents as if they sold their covered financial assets at market value on the departure date. The resulting unrealized gain is then subject to income tax + special reconstruction income tax — a combined rate that is commonly around 20.315% for listed securities (15% national + 5% local + 0.315% reconstruction surtax; your exact rate depends on the asset and your situation, so confirm with a tax professional).
The point of the rule is to stop people with very large gains from moving to a low- or no-tax country and selling there tax-free. It is not a general "leaving fee" and has nothing to do with the ¥1,000 tourist departure tax at the airport.
You're only in scope if, at departure, your covered assets total ¥100,000,000 (¥100M) or more. Covered assets per the NTA include:
• Securities — shares, investment trust (fund) units, bonds, etc.
• Interests in a tokumei kumiai (silent-partnership / anonymous-association) contract.
• Unsettled margin transactions and unsettled derivative transactions — futures, options, and similar open positions.
The scope is financial assets. Things like Japanese real estate are generally outside this list — but categories and edge cases matter, so verify your specific holdings with a professional.
The second gate is the one foreigners most often get wrong in their favour. You're only caught if, in the 10 years immediately before departure, your total period of having an address (jūsho) or abode (kyosho) in Japan exceeds 5 years.
The crucial carve-out: time spent under a residence status listed in Appendix Table 1 of the Immigration Act generally does NOT count toward that 5-year total. Table 1 covers most work and study statuses — for example Engineer/Specialist in Humanities/International Services, Business Manager, Highly Skilled Professional, Intra-company Transferee, Student, and so on. By contrast, Table 2 statuses — Permanent Resident, Spouse or Child of a Japanese National, Spouse of a Permanent Resident, Long-Term Resident — do count.
In plain terms: a decade of working here on an engineer or business-manager visa can still leave you outside Gate 2 — while switching to permanent residency or marrying a Japanese national starts the clock that eventually pulls you in. This is a nuanced legal test with its own conditions and exceptions, so confirm your exact status history with a tax professional before relying on it.
| Your situation | Assets ≥¥100M? | 5-of-10-yr test (counting years) | Exit tax? |
|---|---|---|---|
| Work-visa (Table 1) engineer, 8 yrs, ¥150M portfolio | Yes | Table 1 years usually don't count → likely not met | Likely NO* |
| Student → work visa, ¥40M portfolio | No (under ¥100M) | — | NO |
| Permanent Resident, 7 yrs on PR, ¥300M portfolio | Yes | Table 2 years count → likely met | Likely YES |
| Spouse of Japanese national, 6+ yrs, ¥120M portfolio | Yes | Table 2 years count → likely met | Likely YES |
| Any profile, mostly real estate, few securities | Often No | — | Often NO |
*Illustrative scoring, not a ruling. The residence test has its own rules and exceptions and interacts with your full status history and asset mix. Treat this table as "which gate am I near," then confirm the actual outcome with a tax professional.
If both gates are open, you don't necessarily have to pay the cash on the way out. Japan lets you defer (postpone) the exit tax, provided you do the paperwork correctly. Per the NTA, to get the deferral you must:
• File the departure/final return reporting the deemed gain; and
• Appoint a tax representative (nōzei kanrinin) — a person or company resident in Japan who handles your tax matters — and file that appointment before you leave Japan; and
• Provide collateral (security) by the filing deadline to cover the deferred tax.
Do that and the tax is deferred for 5 years from the departure date, extendable by a further filing to a maximum of 10 years. The payment due date then falls 4 months after the deferral period ends.
The exit tax anticipates that some people leave temporarily. If you return to Japan within the deferral period (within 5 years, or within 10 if extended) and still hold the same covered assets, the exit-tax charge on those still-held assets can be cancelled — but you must file the correcting claim (a request for correction, or an amended return) within the required window (generally within 4 months). There are also downward-adjustment reliefs if the assets fall in value while abroad. These reliefs are procedural and time-limited, so a professional should manage the filings.
Check the gates early. Well before you set a departure date, total your covered assets and map your status history year by year (Table 1 vs Table 2). If either gate is clearly closed, you can relax. If both are open, model the bill at ~20.315% of the unrealized gain, then decide between paying, deferring (line up a nōzei kanrinin and collateral before you go), or restructuring holdings — with a tax professional, not a forum post. Never book the flight first: the tax-representative appointment must be filed before departure, and that deadline is unforgiving.
Related reading: Japan's resident-tax timing trap → and the leaving-Japan pension refund →.
Mio