Working from Japan as a United States resident

At a glance

Rule coverage

What the rules say about Japan

The rules below are the ones most likely to shape a stay in Japan, in plain words and with the source behind each one. Your own report tells you which of them apply to you.

1. Significant issueImmigration and visa

   Past 180 days, no ordinary visitor or nomad route covers you

   The visa-free ceiling tops out at 90 days and the Digital Nomad visa is capped at 6 months with no extension, so a stay beyond 180 days needs a genuine work or residence status instead. Overstaying is a deportable offense under the Immigration Control Act, typically carrying a multi-year re-entry ban, though exact fine amounts were not confirmed in this research pass.

2. Significant issueResidency routes

   Japan has no passive-income, retirement or golden visa route

   There is no status that converts savings, a pension or a property purchase into Japanese residence. Every residency route requires employment, business activity, a points-based skills test, or a family relationship to a Japanese national or resident.

3. Significant issueRight to work

   Working for a Japan-based employer or entity without a permit is prohibited

   Any status short of a full work permit explicitly excludes employment activities with a Japanese organization or individual under an employment contract or contractor agreement. Visiting customers or signing contracts crosses this line when your employer is itself based in Japan, or has a registered entity there that you are effectively working for or paid through, regardless of which visitor or nomad status you hold. Business liaison for a genuinely foreign employer is a separate, lower-risk case covered elsewhere.

4. Significant issueLeaving home: exit tax and ties

   Taking Permanent Residency switches on a JPY 100,000,000 exit tax

   Years spent on a Table 1 work status (Highly Skilled Professional, Business Manager, Engineer/Specialist, Intra-company Transferee) do not count toward the exit tax's 5-of-10-years residence test. The moment you hold Permanent Residency or a Table 2 status instead, those years start counting, and departing Japan later with JPY 100,000,000 or more in securities and similar assets triggers tax on their deemed gain.

5. Significant issueMoving your company

   Japan is a hard no for offshore holding company structures

   Japan's controlled foreign company rules attribute a foreign related company's income to Japanese resident individuals once ownership passes 50 percent in aggregate, or 10 percent for an individual in some circumstances, where the foreign entity's effective tax rate falls below 20 percent for entities failing the economic activity tests, or below 27 percent for paper companies, cash boxes and blacklisted entities. The 27 percent trigger replaced a 30 percent threshold for fiscal years beginning on or after 1 April 2024. A low-tax offshore holding company in the UAE, BVI, Singapore or Cyprus will very likely have its income taxed in Japan at rates up to 55.945 percent anyway.

6. Significant issueCrypto tax and legal status

   Once taxed, crypto gains are miscellaneous income at up to 55.945 percent

   Current Japanese law treats crypto gains as miscellaneous income, aggregated with salary and other income at progressive rates up to 55.945 percent combined. This applies to selling for fiat, spending crypto, and crypto-to-crypto swaps, and pushes your whole income into higher brackets rather than being taxed separately.

What tends to surprise people here

• Invoicing a Japanese client voids Digital Nomad status entirely
• Taking Permanent Residency switches on a JPY 100 million exit tax and worldwide inheritance tax
• Naturalizing means giving up your existing citizenship, dual nationality is not allowed

Tax treaty between United States and Japan