Sugawara-kun Co., Ltd.
[Survey of salaried workers] Fixed amount tax reduction: Approximately 60% do not know about the implementation of fixed amount tax reduction. A professional explains the complex tax reform of income tax and resident tax in an easy-to-understand manner!
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Due to the fiscal year 2020 tax reform, a fixed amount tax reduction will be implemented from June. Therefore, Yuichi Sugawara, a tax accountant who runs the YouTube channel “Escape Tax Accountant Sugawara-kun” with over 550,000 subscribers, is offering a “fixed tax reduction” to 929 male and female office workers aged 25 to 60 nationwide. We conducted a questionnaire survey regarding the following.
[Image 1: https://prtimes.jp/i/134198/9/resize/d134198-9-f36613fd413149b447ac-0.jpg&s3=134198-9-7737efb89cde7ac66b3695501f53ac4b-960×720.jpg] Survey overview
Survey period: May 7th to 8th, 2024
Research method: Internet survey
Survey target: Male and female company employees (regular employees) aged 25 to 60 with an annual income of less than 20 million yen Number of valid respondents: 929 people (20s: 276 people, 30s: 365 people, 40s: 191 people, 50s: 97 people)
Research institution: Freeeasy
*When using the survey results in this release, please indicate “Research by Sugawara-kun, a retired tax accountant.”
Investigation result
First, when we asked “Do you have any dependents?” the answers were “Yes” (30.6%) and “No” (69.4%).
[Image 2: https://prtimes.jp/i/134198/9/resize/d134198-9-8023bdb5715c489239a1-1.png&s3=134198-9-841e44e04db71cafc8ffcff78727cfa0-752×452.png ]
Next, we asked those with or without dependents, “Are you aware that a fixed tax reduction” will be implemented from June of this year? (No: 34.4%), “I don’t know” (Statistics: 58.0%, Yes: 40.8%, No: 65.6%), indicating that about 60% do not know. Additionally, there was a difference of about 25 points in the level of awareness depending on whether the person had dependents or not.
[Image 3: https://prtimes.jp/i/134198/9/resize/d134198-9-d698450f95fe786fa6e1-2.png&s3=134198-9-e3b6c81a6b51f95a8dd49e23b9197d36-752×451.png ]
We asked each of the 390 people who answered that they were aware of the implementation of the fixed-amount tax cut (yes: 168 people, no: 222 people), “What do you know about the “fixed-amount tax cut”? Regardless of whether or not there are dependents, the most common answer is “The breakdown of taxes reduced by the fixed tax reduction (40,000 yen) is “income tax 30,000 yen” and “resident tax 10,000 yen” (statistics: 65.6%, yes: 63.7%, (No: 67.1%), followed by “The amount of fixed tax reduction changes depending on whether or not there are dependents” (Statistics: 33.1%, Yes: 42.3%, No: 26.1%). We also found that, overall, those with dependents were more detailed than those without.
[Image 4: https://prtimes.jp/i/134198/9/resize/d134198-9-5d7be061888167de5dcd-3.png&s3=134198-9-918ca5fb1953f50e9d1f04a77e6135d7-1212×677.png ]
Tax accountant Yuichi Sugawara provides an easy-to-understand explanation of “What is a fixed tax reduction of 40,000 yen?” The fixed tax reduction that will be implemented from June will reduce taxes by 40,000 yen per person. This fixed amount tax reduction has a very complicated mechanism, so many people say that it is “difficult and difficult to understand.” Therefore, this time, we will explain the mechanism of fixed amount tax reduction in a simple and
easy-to-understand way, including how the tax is reduced.
●Mechanism of fixed amount tax reduction
With the fixed amount tax reduction, income tax will be reduced by 30,000 yen and resident tax will be reduced by 10,000 yen per eligible person. Those eligible are spouses living in the same household or dependent relatives (hereinafter referred to as “dependents”). However, people whose salary exceeds 20 million yen are not eligible. To make it easier to understand, we will use the example of Mr. A, a single salary earner with a monthly salary of 300,000 yen, who has no dependents.
Mr. A, who has a monthly salary of 300,000 yen, has a monthly social insurance premium (health insurance premium, welfare pension insurance premium, employment insurance premium, etc.) of 44,250 yen, income tax of 5,950 yen, resident tax of 12,741 yen, and take-home pay of 237,059 yen. . The monthly salary after the fixed tax reduction is as shown in (Figure 1).
[Image 5: https://prtimes.jp/i/134198/9/resize/d134198-9-c0f0e55aff1989cfb334-4.jpg&s3=134198-9-e326b45dde5da7a042871053d46de880-1023×720.jpg] (Figure 1)
The take-home pay from July to October was lower than June, but it was higher than the basic salary. Since the income tax is 5,700 yen in November, you can see that the fixed income tax reduction ends in November. The year-end adjustment takes place in December, and the amount of income tax will vary depending on the person, so the amount you will receive will be unknown.
●Flow of fixed amount tax reduction
So, why does the flow like the one shown above (Figure 1) occur? The income tax of 30,000 yen will be reduced from the monthly withholding income tax of 5,950 yen. Tax was reduced by 29.750 yen for 5 months from June to October. Since 29.750 yen of the 30,000 yen was reduced in tax, there is still a 250 yen tax reduction. The income tax for November is originally 5.950 yen, but after subtracting the remaining tax reduction amount of 250 yen, it becomes 5,700 yen. Here, all 30,000 yen was reduced in tax. This was calculated using only the monthly salary without bonuses, but if there is a summer bonus, the income tax on the bonus can also be reduced, so the fixed tax reduction may end sooner.
Calculation of residence tax is different from income tax. The government has decided not to collect resident tax in June of this year due to the fixed tax reduction. (*1) Therefore, the residence tax from July onwards will be 12,990 yen based on the calculation shown in (Figure 1).
*1 Resident tax is generally collected from salaries for 12 months from June to May of the following year, but this year, due to the fixed tax reduction, it will be collected for 11 months from July to May of the following year.
All of these calculations are for single people with no dependents. On the other hand, if you have dependents, your income tax will be reduced by 30,000 yen for yourself and 30,000 yen for each dependent, and the resident tax will be reduced by 10,000 yen for you and 10,000 yen for each dependent. For example, a household with a full-time housewife and two children would receive a fixed tax reduction, but the income tax would be 120,000 yen (40,000 yen x 4 people), and the resident tax would be 40,000 yen (10,000 yen x 4 people), for a total of 160,000 yen. It will be a yen. In the case of income tax, you have to reduce your tax by 120,000 yen between June and December, but this is difficult considering that even a single person’s 30,000 yen tax is taxed until November. For those who are not expected to receive the full fixed tax reduction, the approximate difference will be paid in the form of an “adjustment benefit” by the city, ward, town or village that levies personal residence tax. Procedures vary depending on the city, ward, town or village where you live.
(*Information as of April 2024.)
Yuichi Sugawara Profile
[Image 6: https://prtimes.jp/i/134198/9/resize/d134198-9-ebc4004db2ab5ff7a810-5.jpg&s3=134198-9-d50773e121e6c86d7c7e0ba73d86bba7-807×1076.jpg] Born in Mie Prefecture in 1975. A tax-saving and cash flow expert who helps 85% of his clients turn a profit.
The YouTube channel “Escape from Tax Accountant Sugawara-kun”, which was launched in January 2023, has exceeded 510,000 subscribers. Blog “Get off! Tax accountant Sugawara’s management techniques to increase your money! ” was ranked number 1 in the national tax accountant blog ranking and was selected as an Ameblo [official] top blogger. He has given lectures over 1,000 times, including to listed companies such as Google and APA Hotels, as well as foreign companies, and has received numerous interviews from various media.
The books “Ultimate Financing” and “50 Super Rare Financing Techniques” (both published by Gentosha) became bestsellers with a cumulative total of 27,000 copies sold.
On February 22, 2024, we released “Where did the tapioca shop go? Business tricks to understand how to start a business and make money”.
Blog: https://ameblo.jp/sannet/
YouTube: https://www.youtube.com/@datu-sugawara
X: https://mobile.twitter.com/sugawara11
Instagram: https://www.instagram.com/sugawara.smg
Threads: https://threads.net/@sugawara.smg
TikTok: https://vt.tiktok.com/ZSexq2jCP/
Facebook: https://www.facebook.com/yuichi.sugawara.5
Company Profile
Trade name: Sugawara-kun Co., Ltd.
Head office location: Nagoya Mitsui Building Main Building 7F, 1-24-30 Meieki Minami, Nakamura-ku, Nagoya, Aichi Prefecture
Representative: Representative Director Yoshiki Horie
Date of establishment: November 8, 2023
Capital: 1,000,000 yen
Business content: Seminar management, YouTube, advertising, consulting URL: https://sugawarakun.com/
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