After it took the Japanese government a while to kick off financial support for residents that are struggling in the current economic climate during the COVID-19 crisis, several relief options are now available. You can read our article on how to receive your 100,000 yen check available to every resident in Japan; however, this article explains how to receive up to 1 million yen for those who are self-employed in Japan.
Who is eligible?
You have to fulfill two conditions to receive the subsidies. The first is that you must be self-employed. This means that you are either a freelancer or employed by one or more companies as a contractor, called gyomu itaku in Japanese. If you aren’t sure, ask the company you are working for, but it is usually the case if your company doesn’t pay social insurance for you.
The second condition is that your sales/income must have decreased by 50% or more in at least one month in 2019 compared to 2020. This is automatically calculated on the online application form, but the formula to work it out yourself is the following:
Take all your freelancer/contractor income of 2019 and divide it by 12 months. Then compare this amount to the month in 2020 when your income was less than half.
For example, if you earned 2.4 million yen as a contractor in 2019, the average monthly amount would be 200,000 yen. If your sales/income in March 2020 was only 50,000 yen because, for example, you lost a lot of private English teaching students or the company you regularly freelanced for let you go, you are eligible to apply.
Finally, both citizens and foreign residents qualify!
How to apply
Surprisingly and thankfully, you can apply online. The application is straightforward and can be completed via the above link in about 20 minutes if you have all the documents you need handy.
Can I apply in English?
Unfortunately not. The online form is only available in Japanese and the supporting documentation must be uploaded in Japanese too. However, you can enlist Google Translate to help you; and no lengthy explanations are needed for the application. Also, this kind soul made a basic but helpful YouTube video explaining the application process in English. It is more geared toward the application process for small business owners but gives a good overview.
Documents needed for the application process
You will need:
- last year’s tax return
- your bank book
- a form of valid Japanese ID
- an overview of this year’s income
For the tax return, attach scans of the stamped copy of your 2019 tax return. If you do not have these because you submitted your tax return by mail, you will have to visit your local tax office. Ask them to show you the form you submitted and copy all information onto a blank form and ask them to give you a 納税証明書 (nozei shomeisho, tax certificate) as proof that this matches your submitted information.
Then, attach a scan or photo of your bank book front and inside cover and the front and back of your residence card, driver’s license or just the front if you are using your “My Number” card (if you have the proper one with a photo of you on it).
Finally, submit an overview of last year’s and this year’s business income by month. If you are a contractor, you can ask the companies you work(ed) for to provide you with documentation, but a spreadsheet breakdown by month is also enough.
How much money will I get?
This depends on how big the difference is compared to last year’s income. You will need to supply three amounts (which should match what you declared on your tax return):
- last year’s total income
- the income amount of the month this year you want to use as a reference value for your losses
- the income amount of the same month last year
If the total losses extrapolated for the whole year are 1 million yen or more, you will receive 1 million yen. If they are less, you will receive that amount, rounded down to an even number.
How long does it take to get my money?
While this might depend on each case and how clear and complete your paperwork is, it usually takes around 2–3 weeks if it is approved. They won’t send you a notice, so just keep an eye on your bank account. If you get rejected but make the cut for the 50% or more loss, you might want to consider enlisting an accountant to help you with your application.
Disclaimer: This article was written to our best knowledge and only as a basic guide for this process. This information may change in the future and we cannot guarantee its accuracy. Consult your local tax office or a reputable professional accountant for full guidelines and information.