MEXC Global: Is cryptocurrency trading (side job) prohibited for civil servants? Explains penalties, possibility of dismissal, and tax return for crypto assets

MEXC

This article explains whether civil servants and company employees can do side jobs regarding virtual currency, crypto asset trading, and investment. In general, investing can be a side job or a source of extra income. However, if you are a salaried employee, there is no problem as long as it is not stated in the employment regulations. In the case of civil servants, there seem to be many restrictions, including the following: Are civil servants prohibited from investing?

Public servant invests in cryptocurrency

It is said that it is not a side job for Japanese public officials to invest in cryptocurrencies. Asset management in virtual currency itself is not illegal. In addition, when investing, as a public servant, we have an obligation to perform our duties properly. It goes without saying, but if you just look at charts while working, you won’t be able to complete your work at all. If you invest too much and it hurts your work, you risk getting laid off, so it’s going to hurt you in moderation. If you do it, you can’t do it without a declaration. You are obliged to report to your superiors.

Articles 103 and 104 of the National Public Service Law

In the case of national civil servants, when it comes to side jobs, it is prohibited to do so without reporting it. If you do it, you must report it to your superiors. If you ignore it, you risk being fired in the worst case scenario. When buying or selling, check the type and first discuss the details later. There are not many cases where it is considered okay, but it depends on the workplace. It is common to be found out if you secretly make deposits or exchanges. This type of activity is also reported in the news.

Article 103 (Isolation from private enterprises)
Article 103 of the National Public Service Law Employees shall not concurrently serve as officers, advisors, or councilors of a company or other organization that aims to operate a commercial, industrial, or financial business or other profit-oriented private enterprise (hereinafter referred to as a profit-making enterprise), or operate a profit-making enterprise themselves.

Article 104 (Restrictions on Involvement in Other Businesses or Affairs)
Article 104 of the National Public Service Law.. In order for employees to receive remuneration, (omitted) to engage in any other business or to carry out clerical work, the permission of the Prime Minister and the head of the agency having jurisdiction over the employee is required.

国家公務員法 | e-Gov法令検索

Local Public Service Law Article 38

When it comes to side jobs, even for local government employees, doing them without reporting them is prohibited. If you do it, you must report it to your superiors. If you ignore it, you risk being fired in the worst case scenario. Generally, there are regulations by law, so remember the conditions for using financial products. In an environment where the latest apps are introduced, virtual currencies can be managed in various ways. Please consult with your employer first. In the market, if you make a profit 24 hours a day, 365 days a year, it is subject to taxation.

Article 38 (Restrictions on Engagement, Etc. with Commercial Companies)
Article 38 of the Local Public Service Law Employees shall not (omitted) operate a profit-making enterprise or engage in any business or clerical work for remuneration without obtaining permission from the appointing authority. (Omitted)

地方公務員法 | e-Gov法令検索

What if you are an office worker?

What if you are an office worker? It is said that bank employees and security guards are difficult and dangerous. Other industries depend on the work regulations. Before doing side jobs or filing tax returns, consult with your company. Popular virtual currencies are calculated annually and if they are positive, you will need to declare them later. If the system does not allow it, you will be changing jobs. If you do not know the tax rate, you will lose out, so check in advance. Currency is received as data, and even if it is small, if there is a record, you will need to declare it. Even busy people can achieve results from their smartphones.

Securing income is profitable

Of course, if you are an office worker and your only income is from the company, you will depend on the company. However, if your profits increase from virtual currencies, it will become a different income and will be different from usual. If you can secure these, you will not have to depend on the company. If you have the knowledge, try it out at an exchange that supports the sale of virtual currencies. If you hold it online and make a settlement, you can of course use the large profits you make to your next investment. If you can earn a certain profit from a certain target stock, you can quit your job. There are always people who become independent, whether it be through stocks, FX, or real estate investments.

Do civil servants have to file tax returns?

Japanese public officials are not legally prohibited from investing in cryptocurrencies. But you have to file an affidavit. This point is exactly the same as that of the general public. Virtual currency investment is miscellaneous income, and if the annual income exceeds 200,000 yen, even public employees are required to file a tax return. If you set the resident tax payment method to special collection at the time of final tax return, there is a possibility that your workplace will find out due to the difference in the amount of resident tax paid in the previous year. If you don’t want to be found out at work, set the resident tax payment method to “ordinary collection” when filing your tax return.

Virtual currency is recommended for civil servants

Virtual currency is a recommended investment for civil servants. Virtual currency is not only leverage trading like FX. There is also staking where you just deposit your money. With staking, you don’t have to look at the charts one by one, so you can rest assured even at work. However, since it is an investment, there is no guarantee that it will be 100% profitable.

Precautions for civil servants to invest in cryptocurrencies

There is also a point to be aware of when public servants invest in cryptocurrencies, because unlike private citizens, it is a tough job. Civil servants are obligated to dedicate themselves to their duties, to maintain confidentiality, and to prohibit acts that undermine public trust. Civil servants are a highly socially trusted profession, so it is important not to pursue debts and not to interfere with your duties by trading all the time at work. If you have problems with debts, etc., it will also be a disadvantage because your personal credit will be flawed.

Side jobs are not prohibited

Virtual currency investment is not prohibited as a side job, but be careful about taxes. If you make a lot of money, you will be taxed on the purchased crypto assets instead of your main job salary, so income tax will be incurred on virtual currencies that are miscellaneous income. This also applies to those who are affiliates with blogs.

always need to study

Virtual currency markets are always moving. It’s not easy to keep winning because you need to study more than the average person. Currently, market prices are constantly changing, not only for FX but also for stock investment and virtual currency coins, so we need to be able to adapt. Prices fluctuate, so the timing of sales and purchases is also important.

You may lose a lot

The virtual currency market does not seem to rise stably even if you operate it every day like NISA, and there are advantages that you can easily win, but there are also disadvantages that you can crash and lose a lot of money. Basically, there is no such thing as 100% investment, so invest a small amount with your surplus funds and do so at your own risk. If you have any concerns or questions, you can contact the Management Support Center.

Open an account

In order to actually start investing, you must first open an account. MEXC allows you to open an account for free, so you can easily open an account. The article below explains how to open an account, so please refer to it.

Possible for company employees and civil servants

Many company employees and civil servants open accounts at MEXC. Even with modern information, the reality is that more and more people are doing side jobs regardless of the content. Basically, we recommend starting with a small amount. In principle, whether a company employee can do a side job will affect the rules of employment, but there are no legal restrictions. There are also cases where people are investing using their time outside of work.

If you make a profit, you need to pay taxes

Once you have determined your profits for the year, you may need to pay a tax accountant for tax return services. Alternatively, you may have to take responsibility and file your tax return yourself, which can be a hassle. Therefore, if your income is determined separately from your employment income, you will need to process it separately. Some companies will do it for you through the year-end adjustment, while others will require you to take measures yourself. The same goes for real estate investment.

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