Tax Dodging -- Outwitting the Tax Nazis

The city that I live in has a fucked up tax collection system for Residency Tax. Luckily I do not live in Shinjyuku Ward, but I've had to do some funky tax dodging this winter holiday.

My company deducts all my taxes (income, resident, what-ever-else-unknown-tax) from my monthly wages, but they over charge me so I get back my returns at the end of the year. The amount is usually around 100,000yen (US$1000) so you want to get that back, right? I can go to Guam for a long weekend with that additional income.

My residency tax is based on my current "address", as far as my company is concerned, is my mother's "government" housing. She is on like ,well, low income (a widow with one lung? of course she lives in the projects. She's not even eligible for disability benefits!!). Her monthly rent amounts to a lot less than my monthly facial/spa/waxing/pampering at Boudouir.

So why am I living in the projects?

Well, in order to rent an apartment in Tokyo you need to pay 2 months' deposit, 2 months' "Key Money" (basically gratuity to the landlord that you will never see again), 1 month realestate agent fees, and 1 month rent upfront. Six months' rent before you move into an unfurnished apartment.

If I want to rent a reasonable place for 150,000yen/month in central Tokyo (this is what a one bedroom place would cost), I need to put up 900,000yen (US$9000) -- and that's excluding all my moval fees to have all my furniture, which is in storage, sent to my new abode.

OUCH!

I gave up my place before I moved to HK so I am a little bit homeless. All my expenses while I lived there I paid upfront, and my company reimburses me 1.5months later (lazy feckers!), by which time I am running expenses again, so I never really *see* my money. Japanese consulting companies do not give you a corporate card so my cashflow is always looking as sick as a ferral cat. If I was a company and went bust tomorrow, the only "liquid asset" I have would be my butt.

So I am saving up (kind of) till I get enuf money to get out of this place. (I often get strange looks by my neighbours in the morning, for I am wearing a suit -- in the projects? Unheard of!)

Right, back to tax evation.

My company does all the paperwork for my tax returns, and I realised that my income is *WAY* too much for someone living in the projects with whacko Cirque de Solaire, seputgenarian window climbing neighbours. I needed to move my "residence" to my brother's place - pronto - to make it look like only poor people live here. Otherwise my mother's rent shoots up the roof, and honestly? I would not pay any more in rent for this shite hole!

Issue: my brother (who works for a US company is technically an expat, even tho' a Japanese national, and hence has no declarable income in Japan coz he's paying US taxes, i.e. can be passed off as unemployed) physically lives somewhere else, but is registered as a resident of these projects just to make it *look* to the Tax Nazi's like we are a real social security case. Oh, and because unemployment benefits last for only 6months after you lose your job, my brother, who has *never* been employed in Japan, has never received a single dole cheque, but nor does he pay into the state pension scheme. His healthcare scheme? Well he's my mother's "dependant" so he's covered by her healthcare.

(We're good, aren't we?)

Solution: My brother hastily moved his residency to his actual *physical* home, I told my company that I moved from the projects to a different location (could they please file my tax return at my brother's place), registered as living at my brother's place with the authorities, while I *physically* reside with my mum. Because the various agencies never share information, and have everything still paper-based, my brother is a dependant of my mother, and me? I get my tax returns at the end of the day.

BRILLIANT!

Must admit the Housing Authority called up the house to confirm that my brother no longer lived there, but that's about it. Luckily the cats were sleeping so they weren't meowing in the background. (This place is a "No Pets" place -- you get kicked out for keeping animals, but many people own animals. The lady who lives upstairs has two ugly mutts that she walks everyday, and no one really gives a damn.) All is fine, and we managed to outwitt the Tax Nazis.

Next Steps: My mother retires this year. She will reside in her project, but will technically be my dependant, and so will my brother. Result? End of 2005, my taxable income decreases, and my returns will be higher. Perhaps I can go to Hawaii with my little bonus...

(Post script: I guess I should thank life in London for teaching me such wonderful skills to outwit the Tax Nazis. Although I would not recommend people to tax-dodge on a regular basis, we do it out of neccessity. In a country where the TNs are militant about collecting your money, while having little or no social security for people with disabilities, on low income, or even with longterm illnesses that require *a lot* of money for treatment, I think that I'm just a small time crook. Plus, at the end of the day, I *am* paying all my dues -- they get taken from me automatically anyway -- so I'm just a little minow in the world of tax dodgers)