Australia vs Japan taxes (2026): income, company and investments

Australia vs Japan tax rates at a glance

Tax	🇦🇺 Australia	🇯🇵 Japan
Income tax	Tax-free threshold: AUD 18,200 Next band: 16% Middle band: 30% Upper band: 37% Top rate: 45% Medicare levy: 2%	National income tax: 5% - 45% Highest bracket tax: 45% Inhabitant tax: 4% + 6% Reconstruction surtax: 2.1% of income tax Non-resident salary: 20.42% Employment-income deduction: ¥650,000 minimum Individual enterprise tax: 3% - 5% Very-high-income additional rule: 22.5% comparison rate
Corporate tax	Base-rate entity rate: 25% General company rate: 30% Franking credits: Available GST: 10%	Standard national corporation tax: 23.2% Qualifying SME first ¥8 million: 15% Certain high-income SMEs first ¥8 million: 17% Large-company effective rate: 30.64% Qualifying SME effective bands: 21.94% / 23.73% / 34.43% Pillar Two minimum: 15%
Capital gains tax	Inclusion method: Marginal rates Individual discount: 50% after 12 months Effective top individual rate on discounted gain: About 22.5% before levy Company treatment: Generally no discount	Listed securities: 20.315% Long-term land and buildings: 20.315% Short-term land and buildings: 39.63% Cryptoassets: Progressive income rates Main-home special deduction: Up to ¥30 million
Dividend tax	Resident taxation: Marginal rates Franking credit benefit: Offsets company tax paid Domestic non-resident WHT: Often 30% on unfranked Treaty rates: Often lower	Listed shares below 3%: 20.315% Unlisted shares: 20.42% Listed shares at or above 3%: 20.42% National portion on listed shares: 15.315% Local portion on listed shares: 5% NISA dividends: 0%
Wealth tax	Net wealth tax: 0% Annual federal asset tax: 0% Land tax / stamp duty: State rules apply	Personal net wealth tax: 0% Fixed asset tax: 1.4% City planning tax: Up to 0.3% Business-office tax: ¥600 / m² + 0.25% payroll
Inheritance / estate tax	Estate / inheritance tax: 0% General gift tax: 0% Super death benefits: Can apply Later CGT on inherited assets: Possible	Inheritance tax range: 10% - 55% Basic exemption: ¥30m + ¥6m × statutory heirs Statutory share up to ¥10m: 10% Statutory share ¥100m - ¥200m: 40% Statutory share ¥300m - ¥600m: 50% Statutory share above ¥600m: 55% Spouse credit: ¥160m or legal share Annual gift exemption: ¥1.1 million
VAT / GST / sales tax	GST: 10%	Consumption tax: 10% / 8%
Other key taxes	None listed on country overview	Special reconstruction surtax: 2.1% of income tax Inhabitant tax: About 10%

Who wins on each tax

Personal income taxTie

Both national scales reach 45%; Japan generally adds local inhabitant tax and reconstruction surtax, while Australia adds the Medicare levy.

Corporate taxAustralia

Australia uses 25% for qualifying base-rate entities and 30% otherwise; Japan's ordinary corporate effective burden is around 30.64% including its 2026 defense surcharge example.

Capital gains taxJapan

Japan commonly taxes listed securities at 20.315%; Australia taxes gains through income tax, with a 50% discount commonly available after 12 months for individuals.

Dividend taxTie

Australia's franking credits can offset company tax; Japan commonly withholds 20.315% on listed-share dividends, so company ownership and shareholder status decide.

Inheritance taxAustralia

Australia has no federal inheritance tax, while Japan's estate tax ranges from 10% to 55% after the basic exemption.

The verdict

Both ordinary personal systems reach 45%, but Japan adds about 10% inhabitant tax and a 2.1% reconstruction surtax, while Australia adds a 2% Medicare levy.

Japan's listed-securities rate is commonly 20.315%, below Australia's highest effective rate even after the 50% individual CGT discount. Australia counters with franking credits for dividends.

Choose Australia for an English-speaking operating base and company system; choose Japan for a Japan-centred workforce or listed-investment profile. Residence, exit tax, social security and treaty sourcing need careful work.

How to read this comparison

Australia is usually the cleaner company and succession base; Japan can be the better listed-investment or Japan-centred operating choice. Both add local tax layers beyond the national headline.

Frequently asked questions

Is Australia or Japan lower tax?

Australia is usually simpler for companies and succession, while Japan can be competitive for listed securities and some dividend profiles. Local taxes, social security and residence determine the individual result.

Does Japan have inheritance tax?

Yes. Japan applies progressive inheritance tax from 10% to 55%, with a basic exemption of JPY 30 million plus JPY 6 million per statutory heir and additional reliefs.