Notice of Revision of Resident Tax System for FY2017

Contents of tax system revision of personal municipal tax, prefectural tax carried out from 2017 are as follows.

Revision of employment income deduction
About extension of special tax credits such as housing loans
Total profit and loss on transfer losses on shares, etc. and deductions carried forward
Regarding mandatory attachment of documents such as dependent deductions for relatives residing outside Japan
Establishment of switch OTC drug deduction (exception of medical expenses deduction) to promote self-medication (self-medication)

The salary income to which the upper limit of employment income deduction is applied has been reduced from 15 million yen to 12 million yen, and the upper limit of employment income deduction when the salary income exceeds 12 million yen has been changed to 2.3 million yen. .

Regarding the application of the mortgage deduction for personal municipal tax and prefectural tax, the date of use for residence (hereinafter referred to as "the date of commencement of residence") is until December 31, 2021. Has been revised to target.
Prior to the revision, those who were eligible until June 30, 2019 were eligible.

Transfer income related to stocks, etc. is divided into transfer income related to listed stocks, etc. and transfer income related to general stocks, etc. The transfer loss related to stocks, etc. that occurred during 2016 is the transfer loss that occurred on the other hand It is no longer possible to count as transfer income.
In addition, for the amount of transfer loss on listed stocks, etc. that occurred in each year before 2015 and carried over to 2016, the amount of transfer income, etc. of listed stocks, etc. for 2016 and listed stocks From the amount of dividend income, etc. related to stocks, etc., you can carry forward deductions as before, but you can no transfer income, etc. related to general stocks, you can be carried forward.

From the declaration of personal municipal tax and prefectural tax in fiscal 2017, dependent deductions, spouse deductions, special spouse deductions or deductions for persons with disabilities pertaining to relatives who do not have Address in Japan (including dependent relatives under 16 years of age). Hereinafter referred to as “dependency deductions, etc.”) Those who are subject to the application of the tax exemption limit system shall submit their kinship documents (Note 1) and remittance documents (Note 2) to the declaration of personal municipal tax and prefectural tax. It must be attached to or presented at the time of submission. (*) (If kinship documents or remittance documents are prepared in a foreign language, a translation must be attached.)
However, if you have already submitted attached documents for year-end adjustment, final tax return, etc., you do not need to attach or present it.
（※） Includes dependent relatives under the age of 16 who are subject to the personal municipal tax and prefectural tax exemption limit system (personal tax exemption system).

(Note 1) Relative documents refer to any of the documents (1) and (2).
（１） Copy of family register's tag or other documents issued by other national or local governments that prove that a person who does not have Address in Japan is a relative of a person who is subject to the dependent deduction or the tax exemption limit system and a copy of the passport of the relative.
（２） Documents issued by a foreign government or a foreign local government that proves that a person who does not have a Address in Japan is a relative of a person who is subject to the application of dependent deductions or the tax exemption limit system (with the name of the relative, Address and date of birth).

(Note 2) Remittance documents refer to the following:
The following documents (1) or (2) in the previous year of the year to which the first day of the year in which the dependent deduction is applied or the tax exemption limit system belongs to the living expenses or education expenses of relatives who do not have Address in Japan It is clear that payment from a person who is subject to the application of the dependent deduction or the tax exemption limit system has been made whenever necessary.
（１） Documents clarifying that payment has been made by the person to his / her relatives through exchange transactions conducted by the financial institution.
（２） Those who present the card issued by the so-called credit card issuing company and receive the amount equivalent to the purchase price of the product, etc., and receive the application of the dependent deduction or the tax exemption limit system Documents that clarify that they have been received from the person

<Overview of the System>
If a taxpayer who has taken certain measures to maintain and improve health and prevent illness pays for the purchase of over-the-counter drugs for his or her spouse or other relatives who make a living with him between January 1, 2017 and December 31, 2021, a certain amount of income deduction (medical expenses deduction). This is called the self-medication tax system.
The self-medication tax system is an exception to the medical expenses deduction, which is an option to the conventional medical expenses deduction.
Therefore, if this special provision is applied, the current medical expenses deduction cannot be applied.

<Requirements for being subject to self-medication taxation>
(1)Taxpayers who are eligible
Individuals who are taking “certain measures” as measures to maintain and improve health and prevent illness in the year in which the self-medication tax system is applied are eligible.
"Constant efforts" specifically correspond to the following initiatives (limited to those with the involvement of a doctor) 。

・Health Checkups [human dogs, various health examinations, etc.] implemented by insurers (health insurance unions, municipal national health insurance, etc.)
・Health Checkups (Health Checkups for recipients of social security) conducted by municipalities as a health promotion business
・Vaccinations [Regular vaccination, influenza vaccine Vaccinations]
・Regular physical checkup [Employer health check-up]
・Specific Health Checkups (metabo health check-up), specific health guidance
・Cancer screening conducted by municipalities as a health promotion business

(2)Scope of purchase costs for over-the-counter drugs
Over-the-counter drug purchase cost refers to the purchase cost of switch OTC drugs.
For specific items of Switch OTC drugs subject to self-medication taxation, please refer to the Ministry of Health, Labour and Welfare's website, “List of Target Items (move to the Ministry of Health, Labour and Welfare website). (External site) is posted on the website.

<How to calculate the deduction amount>
The amount obtained by subtracting 12,000 yen from the total amount of the purchase cost of over-the-counter drugs actually paid (excluding the portion covered by insurance money, etc.) (up to 88,000 yen) is that year Deducted from the total income amount for the year.

<Procedures for receiving the self-medication tax system>
It is from taxation in 2018 (report for 2017) to be applied by personal municipal tax, prefectural tax.
When submitting a personal municipal tax / prefectural tax return, you will need to fill out and submit matters related to the application of the self-medication tax system. (If you submit required items in the final tax return, you do not need to submit your personal municipal tax / prefectural tax return again.) 。
In addition, we attach the next documents to personal municipal tax, prefectural tax return or present at the time of presentation of personal municipal tax, prefectural tax return.

(1) Documents certifying the receipt of the over-the-counter drug purchase cost, which is the basis for calculating the amount subject to the self-medication tax system (for which the amount corresponding to the over-the-counter drug purchase cost is clarified) Limited.)

(2) Documents that clarify that taxpayers who are subject to the self-medication tax system have taken certain measures for the year in which they are intended to be applied (name, year of the initiative, and insurer who conducted the business related to the initiative Limited to those with the name of the medical institution that conducted the consultation pertaining to the initiative or the name of the doctor.)

Click here for the self-medication tax system (exception of medical expenses deduction) (move to the Ministry of Health, Labour and Welfare website) (External Site)
Reference: When you pay for the purchase of over-the-counter drugs (exception of medical expenses deduction) (move to the NTA website) (External Site)