How to Write a Statement of Reasons for Immigration Applications When You Have a Tax-Exempt Period#

In Japanese immigration procedures, particularly for Permanent Residence (PR) applications, the fulfillment of tax obligations is scrutinized with extreme strictness. Generally, PR applications require a review of the applicant’s Residence Tax (Juminzei) status for the past five years. It is not uncommon for applicants to have a “tax-exempt period” (Hikazei kikan)—a period where no Residence Tax was imposed due to low income—within this timeframe.

Having a tax-exempt period does not automatically lead to a rejection. However, if an applicant cannot rationally explain why their income was low or non-existent during that specific period, the Immigration Services Agency may determine that the applicant fails to meet the “Independent Livelihood Requirement” (Dokuritsu Seikei Yoken), which assesses whether one has sufficient assets or skills to earn an independent living.

This article provides an objective explanation of how to address tax-exempt periods in your application and how to structure the “Statement of Reasons” (Riyusho) effectively.

Understanding the Impact of Tax-Exempt Periods on Screening#

First, it is essential to understand why the Immigration Bureau focuses on tax history. To settle or obtain Permanent Residence in Japan, a foreign national must demonstrate a stable economic foundation that ensures they will not become a burden on the public (e.g., requiring welfare assistance).

Being “tax-exempt” for Residence Tax generally means that the previous year’s income was below a certain threshold (typically around 1 million yen for a single person, though this varies by municipality). If this status persists for a long time, it raises doubts about the applicant’s ability to live stably in Japan. Therefore, the Statement of Reasons must construct a narrative based on objective facts: “Although I was tax-exempt in the past due to temporary circumstances, my situation is now stable, and there will be no issues in the future.”

Specific Scenarios: What to Include in the Statement#

While the reasons for non-taxable status vary, the key points to emphasize differ depending on the scenario.

1. Transitioning from Student Status to a Work Visa#

When applying for Permanent Residence, if the earlier part of the five-year period was under a “Student” visa, it is natural that the applicant did not have full-time employment income and was thus tax-exempt.

In this case, the Statement of Reasons should clearly specify:

Duration: The specific dates from start to finish of the student period.
Situation: An explanation that the applicant was dedicated to their studies and income was limited to part-time work, resulting in tax-exempt status.
Current Status: A statement confirming that after graduation, the applicant was hired as a regular employee and is now earning sufficient income subject to taxation.

This is generally accepted as a valid reason. It is crucial to state the facts calmly while ensuring consistency with the resume (CV) submitted.

2. Gaps Due to Job Changes or Unemployment#

If an applicant resigned from a job and had a gap (several months to under a year) before finding the next position, their annual income for that year might have dropped, resulting in tax-exempt status.

Here, the focus should be on proving that the gap was a “temporary void due to career advancement or unavoidable circumstances” rather than “chronic instability.”

Reason for Leaving: Expiration of contract, company restructuring, or resignation for career advancement.
Job Hunting Activity: Evidence that the applicant was not idle but actively seeking employment.
Source of Living Expenses: Clarification that living expenses during the unemployed period were covered by savings and not by public welfare assistance.

3. Being a Dependent Spouse#

This applies if there was a period where the applicant limited their income or had no income because they were a dependent of their spouse (e.g., Category 3 Insured Person).

In this scenario, one must appeal to the economic stability of the “household unit” rather than the individual alone.

Fact of Dependency: The period during which the applicant was a dependent and the reason (e.g., child-rearing, shortly after arriving in Japan).
Household Income: Proof that the spouse had sufficient income during that period and the household was not in financial distress (attach the spouse’s Taxation/Tax Payment Certificates).
Current Status: If the applicant is now working and no longer a dependent, explain the transition and current stable income.

4. Maternity or Childcare Leave#

During maternity or childcare leave, salary payments often cease (replaced by benefits which are non-taxable income), leading to Residence Tax exemption.

As this is a legitimate exercise of rights under Japanese labor laws and consistent with policies to combat the declining birthrate, it should not be viewed negatively, but an explanation is mandatory.

Use of System: State that childcare leave was taken in accordance with company regulations.
Return to Work: Confirm that the applicant has returned to the workplace and is currently working and paying taxes as usual.
Supporting Documents: Attach copies of the “Notification of Childcare Leave Benefits” or a Certificate of Employment that notes the leave period.

Important Considerations When Drafting the Letter#

Consistency with Other Documents#

The most critical factor is consistency. If the resume states the applicant was “employed” during a specific year, but the tax certificate shows “non-taxable” status, immigration officials will suspect illegal employment, tax evasion (underreporting income), or falsified application documents. It is vital to check that dates and figures align perfectly across all submitted papers.

Objective Explanation Over Emotional Appeal#

While expressing a desire to live in Japan is important, the explanation of tax status requires logic, not emotion. The statement should concisely address three points: “When and why was the income low?”, “How were living expenses covered during that time?”, and “How has the situation been resolved now?”

Conclusion#

Having a tax-exempt period within the last five years does not mean one must give up on Permanent Residence or Naturalization. The key is to convince the examiner that the non-taxable period does not indicate a “lack of economic foundation” but was a “temporary state due to reasonable life stage circumstances.”

By honestly explaining the situation without concealment and presenting a set of documents proving current stability (current Certificate of Employment, pay slips, most recent Taxation Certificate), applicants can maintain a strong possibility of approval.