RResidents in Japan

Advice for IT freelancing side gig

  • February 9, 2026

I'm changing jobs next month, but my current company still desperately needs me as I'm the sole developer there, building some of their systems from scratch over the past few years. My buchou offered to pay me to finish the new app and maintain the existing ones, at least for short-term.

I have PR so visa isn't a problem. Both old and new places are nikkei Japanese companies. I'm expecting maybe 10-20 hours/month for maintenance, possibly more initially for dev work. I've never freelanced before so I'd appreciate any advice, especially things like 業務委託 contract or if something informal is fine, and anything else I should watch out for.

Has anyone been in a similar situation?

by notathrowacc

4 comments

  1. Main thing to check first… does your new company allow 副業 (side work)?
    If it’s prohibited in your contract or 就業規則, it’s a real risk. Even small amounts of side income can surface at 年末調整 / 住民税 time, and that’s how people often get found out.

    Second, don’t do this informally. Use a proper 業務委託契約 with your old company. Make the scope, hours, pay, IP ownership, and responsibility boundaries explicit. This protects you if something breaks later or the work quietly expands.

    Taxes-wise, you’ll likely need to file 確定申告 for the委託 income, so plan for that. This setup is fairly common, but only safe if 副業 is allowed and the contract is clear.

  2. Actually, because you have PR, I recommend you to sign a 業務委託 contract. That way, you don’t need to pay additional pension and health insurance as you will be under company insurance and pension from your full time job. As for taxes, file the tax return separately and request for the 住民税 to be separated and not entirely sent to your employer. This way, even if your employer does not permit side gigs, you can do it as there’s no way for them to figure out (unless you spit it out) and also law permits multiple employments anyways. I have done it and didn’t have any issues.

  3. Remember to charge more for freelance rates than when you’re on salary. As a sole proprietor, you’re responsible for the entirety of your taxes, health insurance, and pension payments, the company will not pay half of it for you.

    Also, look into “blue return system” for your taxes. (青色申告).

    As for sales tax and t-number, if your income does not exceed 10 million ¥, then you do not need to file for t-number and pay sales tax. However, most freelancers without t-number still charge the client for 10% sales tax. This is because, as a transitionary measure into the new fully tracked invoicing system, Japan still allows your clients to deduct 8% of your “sales tax” in their tax return even when you don’t pay sales tax.
    (Look into this more and perhaps even discuss with an accountant, it sounds insane but it’s true.)

    Also, oftentimes the client would pay you after they have deducted the 2% they can’t get back and also your “withholding tax”, which is 10.21% for invoices below 1 million ¥ per month. The withholding tax is the federal income tax, and if they deduct this before paying you, they will need to send you a proof of invoice payment and withholding tax deduction at the end of the year, which you can then file with your taxes so you don’t need to double-pay.

    So if you’re billing for 100,000¥ 税抜, your invoice will end up looking something like:

    100,000¥ + 10% sales tax 10,000¥ = 110,000¥

    And your client will end up paying you

    100,000¥ + 8% 8,000¥ – 10.21% 10,210¥ =~ 97,790¥

    My math is probably off since I have an accountant calculate things for me, but this is the general vibe. People can feel free to correct me if I’m wrong somewhere.

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