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The following forms of income are exempt from tax if they are received by an individual:
- Relocation expenses paid by an employer.
- Housing supplied by the employer, subject to certain terms.
- Reasonable airfare paid by the employer for home leave.
- Severance pay, subject to certain conditions.
- Incidental income from gifts and grants from the company, subject to specific conditions.
- For companies, dividends received from a Japanese company, when the holding in the paying company is 25% or more and the shares are held for six months minimum are tax exempt.
- If the holding is less than 25% or the holding period is less than six months 50% of the dividend income is taxable.
- Dividend received from a foreign company when the holding is 25% or more and the holding period is more than six months, only 5% of the dividend income is taxable. 95% of the income is tax exempt.
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