Side Income in Japan: Freelance, Stocks, Crypto

Last updated: 17 October 2026 · the National Tax Agency’s guidance as of April 2026 · the 2026 tax year

Money you make on top of a salary is not all taxed the same way. Freelance fees are business or miscellaneous income, added to your salary; shares and funds are taxed separately at a flat rate, often by the broker before you see the money; NISA is not taxed at all; and crypto is, for now, miscellaneous income added to your salary. Which kind you have decides whether it belongs in a tax return and whether it counts towards the ¥200,000 side-income rule, the line above which an employee has to file. This page goes through them one by one.

This is a general explanation for somebody resident in Japan with a salary from one employer, and the figures are for the 2026 tax year. A 税理士 (licensed tax accountant) or the tax office is the person to ask about your own income.

Freelance work: business or miscellaneous income

Fees for work you do on your own account — translation, design, teaching, writing — are either business income (事業所得) or miscellaneous income (雑所得). Either way it is the fees minus the expenses of earning them, added to your salary and taxed at your ordinary rates. The difference is whether the work is done on a scale society would call a business. The National Tax Agency’s guideline adds a practical test: if you keep no books, it is treated as miscellaneous income, unless the takings are over ¥3,000,000 and other facts show it is a business.

For most side jobs the answer is miscellaneous income, and two things follow from it:

• A loss cannot be set against your salary. Losses from business income can reduce the rest of your income; losses from miscellaneous income cannot.
• No blue-return deduction. The blue-return special deduction (青色申告特別控除) of up to ¥650,000 is only for business and property income. It is ¥550,000 for double-entry books with a balance sheet and a return filed on time, ¥650,000 if on top of that you file through e-Tax or keep books that meet the stricter electronic-records standard (優良な電子帳簿) and notify the tax office, and ¥100,000 with simpler books. Ordinary accounting software on its own is not enough for the top tier. All three tiers need approval to file a blue return in the first place: you apply to the tax office (青色申告承認申請書) by 15 March of the first year you want it, or within two months of starting if the business starts on or after 16 January. The tax return itself is not the application, and the application is separate from the electronic-books notification.

Miscellaneous or business, freelance income counts towards the ¥200,000.

Shares and funds: usually done for you

Gains from selling listed shares and funds are taxed separately from your salary, at a flat 20.315%: 15.315% income tax, including the reconstruction surcharge, and 5% resident tax. How much you have to do depends on the account:

• A specified account with tax withheld (特定口座・源泉徴収あり) at a Japanese broker: the broker takes the tax when you sell. You can leave it out of your tax return, and if you do, it does not count towards the ¥200,000. You might still report it to use a loss in another account.
• A general account, a specified account without withholding, or a broker abroad: nobody has taken the tax. The gains count towards the ¥200,000, and go in your tax return whenever you file one; below the line they still have to be declared for resident tax.

Dividends from listed shares, paid by a Japanese company or through a Japanese broker, have the same 20.315% taken at source (on foreign shares, after any foreign tax), but they come with a choice: you can usually leave them out of your return, or report them, either separately at the flat rate or added to your salary. Added to salary, dividends from Japanese companies usually bring a dividend credit (配当控除), which can suit a lower income; dividends from foreign companies and REIT distributions do not get it. If you hold a large stake in the company — 3% or more, counting companies you control — the dividends have to go in with your salary. Dividends paid to you through a broker abroad are different: no Japanese tax has been taken, the choice to leave them out does not apply, and, like the gains, they count towards the ¥200,000 and go in your return whenever you file one.

What this page says about a broker abroad assumes you are taxed in Japan on income from everywhere, as most residents are. A non-permanent resident (非永住者) is taxed on dividends from abroad only if they are paid in Japan or brought in, and on gains from shares sold abroad depending on when the shares were bought; the guide to tax residency sets out who that is and how it works.

NISA: not taxed

Gains and dividends inside a NISA account are not taxed, so there is nothing to report and nothing to count. One setting matters: dividends on listed shares are tax-free only if they are paid through your broker (株式数比例配分方式). If they are paid to you directly by the company — by bank transfer or a dividend slip — tax is taken as usual. The catch is the other way round: a loss inside NISA is treated as if it did not happen, and cannot be set against gains in another account.

Crypto: miscellaneous income, for now

The National Tax Agency’s position is that a profit from selling or using crypto is, in principle, miscellaneous income. That means it is added to your salary and taxed at your ordinary income tax rate, plus about 10% resident tax, and it counts towards the ¥200,000. A profit is made not only when you sell for yen, but also when you swap one coin for another or spend it. A loss cannot be set against your salary.

This is set to change. The 2026 tax reform outline taxes gains on crypto sold through registered exchange operators separately, at 20%, but only from 1 January of the year after a related securities law amendment takes effect. That cannot be earlier than 2027, so for the 2026 tax year the ordinary rule applies.

Resident tax is a separate step

Whatever the ¥200,000 rule says about the income tax return, resident tax has no such threshold: side income below the line still has to be declared to your city, and a tax return does that for you. The side-income rule guide explains the rule, what it costs on a real salary, and the second-job test. To see what your salary itself takes home, use the take-home calculator.

Questions people ask

Do I have to file a tax return for my NISA account?

No. Gains and dividends inside a NISA account are not taxed, so there is nothing to report and they do not count towards any filing threshold. For dividends on listed shares that holds only if they are paid through your broker (株式数比例配分方式); dividends collected directly from the company are taxed. A loss inside NISA cannot be set against gains elsewhere, either.

I sold shares through a Japanese broker. Do they count towards the ¥200,000?

Not if they were in a specified account with tax withheld (源泉徴収あり) and you choose not to report them: the broker has already taken the tax, and those gains are left out of the count. Gains in a general account, or at a broker abroad, do count, and go in your return whenever you file one — unless you are a non-permanent resident and Japan does not tax that gain (see the guide to tax residency).

Is crypto taxed at a flat 20% in Japan?

Not for 2026. Crypto gains are miscellaneous income, added to your salary and taxed at your income tax rate plus resident tax. A flat rate for crypto traded through registered exchanges is planned, but only from the year after a related securities law change takes effect.

See your salary’s take-home

Sources

• National Tax Agency — No.1900 給与所得者で確定申告が必要な人 (the ¥200,000 test; share gains in a withholding account and dividends you choose not to report are left out). Japanese, as of 1 April 2026.
• National Tax Agency — 所得税基本通達 35-2 (business or miscellaneous income; without books, miscellaneous unless the takings are over ¥3,000,000 and there are facts showing a business) and No.1500 雑所得. Japanese.
• National Tax Agency — No.2250 損益通算 (business losses can be set against other income; miscellaneous losses cannot) and No.2072 青色申告特別控除 (¥550,000 with double-entry books, a balance sheet and a return on time; ¥650,000 with e-Tax or qualifying electronic books and the notification on top; ¥100,000 otherwise; business and property income) and No.2070 青色申告制度 (the application for approval: by 15 March of the year, or within two months of starting a business on or after 16 January). Japanese, as of 1 April 2026.
• National Tax Agency — No.1463 株式等を譲渡したときの課税 (listed shares: 20%, 15% income tax and 5% resident tax, with the 2.1% reconstruction surcharge on the income tax). Japanese, as of 1 April 2026.
• National Tax Agency — No.1331 株式等の配当等の課税 (listed-share dividends: 15.315% income tax and 5% resident tax at source; report them with other income or separately, or not at all; a shareholder with 3% or more must report them with other income; the dividend credit is not given on foreign companies’ dividends or REIT distributions). Japanese, as of 1 April 2026.
• Act on Special Measures Concerning Taxation (租税特別措置法) 第8条の5・第9条の2 — e-Gov (dividends on foreign shares are taxed at source, and can be left out of a return, only when a payment handler in Japan passes them on; paid abroad, neither applies). Opened 19 October 2026.
• Financial Services Agency — NISAを知る (gains and dividends in NISA are not taxed) and National Tax Agency — No.1535 NISA (listed-share dividends only when paid through the broker, 株式数比例配分方式). Japanese, as of 1 April 2026.
• National Tax Agency — 暗号資産等に関する税務上の取扱い及び計算書について（令和7年12月） (a profit from selling or using crypto is, in principle, miscellaneous income). Japanese, opened 17 October 2026.
• Ministry of Finance — 令和8年度税制改正の大綱 (crypto through registered operators taxed separately at 20%, from 1 January of the year after the securities law amendment takes effect). Japanese, opened 17 October 2026.