Crypto Asset (Virtual Currency) Tax Guide for Foreigners in Japan【2026 · Tax Filing · Calculation】
📋 Contents
Foreigners living in Japan who profit from crypto asset (virtual currency) trading are in principle required to file a Japanese tax return. Profits are classified as "miscellaneous income" (雑所得), combined with salary and other income, and taxed at progressive rates up to approximately 55%. This guide covers when you are taxed, how to calculate gains, key differences from stocks, and special considerations for foreign residents. For final tax decisions, please consult a tax accountant or your local tax office.
① When is profit taxed? (Taxable events)
Tax liability arises when you actually sell, exchange, or use crypto assets. Simply holding crypto (unrealized gains) is generally not a taxable event for individuals.
- Selling crypto for yen or foreign currency (e.g., BTC→JPY)
- Trading one crypto for another (e.g., BTC→ETH — treated as disposing of the original asset)
- Paying for goods or services with crypto
- Receiving mining, staking, or lending rewards (market value at time of receipt is income)
② Income classification: miscellaneous income & tax rates
Individual crypto profits are generally classified as miscellaneous income subject to comprehensive taxation, combined with salary and other income. Progressive tax rates apply.
| Taxable income (total) | Income tax | Resident tax | Effective rate incl. surtax (approx.) |
|---|---|---|---|
| Up to ¥1.95M | 5% | ~10% | ~15.1% |
| ¥1.95M – ¥3.3M | 10% | ~10% | ~20.2% |
| ¥3.3M – ¥6.95M | 20% | ~10% | ~30.4% |
| ¥6.95M – ¥9M | 23% | ~10% | ~33.5% |
| ¥9M – ¥18M | 33% | ~10% | ~43.7% |
| ¥18M – ¥40M | 40% | ~10% | ~50,8% |
| Over ¥40M | 45% | ~10% | ~55.9% |
※Reconstruction surtax = income tax × 2.1%. Rates and deductions are subject to change.
③ The ¥200,000 rule for company employees
Company employees receiving salary from one employer with year-end tax adjustment completed: if total non-salary income (including crypto gains) is ¥200,000 or less per year, an income tax return is generally not required (Income Tax Act Art. 121).
· The ¥200,000 rule does NOT apply to resident tax — a separate municipal declaration may still be required.
· If you file for medical expense deductions or furusato nozei, all income must be reported.
· If gains exceed ¥200,000, a tax return is mandatory (filing period: Feb 16 – Mar 15 of the following year).
④ Calculating your gain (cost basis methods)
Gain = sale price − cost basis. Two methods for calculating cost basis: Total average method (default, no filing required) and Moving average method (requires prior notification to your tax office). The NTA provides free Excel calculation templates for both methods (NTA website ↗).
Most domestic exchanges (Coincheck, GMO Coin, bitFlyer, etc.) issue annual transaction reports. Third-party calculation tools (e.g., Gtax, Cryptact) can aggregate data from multiple exchanges.
⑤ Key difference from stocks: no loss offsetting or carryforward
· You cannot offset crypto losses against income from other categories (offsetting is only permitted within miscellaneous income — e.g., loss on crypto A can offset gain on crypto B, but not stock gains).
· Loss carryforward to future years is not permitted.
· Stocks and investment trusts benefit from separate 20.315% tax and 3-year loss carryforward — crypto currently does not.
⑥ Foreign resident considerations
Tax residents (having a domicile in Japan or residing continuously for 1+ year) owe Japanese tax on worldwide income. Profits from foreign exchanges (Binance, Kraken, etc.) must still be reported. Non-residents are taxed only on Japan-source income — but genuine relocation (removing residence registration, actually living abroad 183+ days, etc.) is required to qualify.
Crypto assets held as physical assets are currently not subject to Japan's exit tax (国外転出時課税) as of June 2026. However, if you have large unrealized gains and are planning to leave Japan, consult a tax professional in advance.
⑦ Tax reform outlook (expected 2028)
The FY2026 Tax Reform Outline (announced Dec 19, 2025) proposes major changes: separate taxation at ~20.315% and 3-year loss carryforward for "designated crypto assets" sold via registered domestic dealers. The expected effective date is the January 1 following the year the amended Financial Instruments and Exchange Act comes into force — earliest January 1, 2028. Transactions in 2026 and 2027 remain under the current comprehensive taxation system. Details will be finalized when legislation passes. Rules are subject to change.
⑧ FAQ
* Tax decisions should be confirmed with a tax accountant or tax office. Rates and rules are subject to change. Affiliate links may be used; rankings are independently chosen.