Frequently Asked Questions
I wonder if I start a business in Japan. What industries are there most among foreign people?
The wholesale business is the most much when foreign people start businesses in Japan.
Survey on Foreign Managers in Japan: Overview of Their Managed Corporations
I started a business in Japan and heard there is a simplified consumption tax system. What is it like?
A simplified consumption tax system in Japan is convenient, but you have to be careful on some points.
Understanding Japanese Consumption Taxes: Simplified Consumption Tax System
I started a business in Japan. This summer, I am going out for a drink with my friend during the Bon festival. Is not this cost considered an expense for tax purposes?
If your friend becomes your client or the reverse happens, you might claim it as an expense in Japan.
Can You Claim the Drinks with Classmates During Bon Vacation as Expenses?
I started a business in Japan and will spend the Bon season there for the first time this year. How do most Japanese spend it?
Japanese enjoy the Bon season respectively.
I started a business in Japan and heard about the culture of gifting such as お中元 and お歳暮. Should I do them?
This custom of gifting something to business-related people remains even now in Japan.
Etiquette for Receiving Seasonal Gifts (お中元 & お歳暮) from Business Associates in Japan
I started a business in Japan. Can I claim expenditures to start a business as expenses for tax purposes there?
You can claim them as expenses. In addition, You can deduct them whenever you like.
Are Expenditures to Prepare a Business Considered Expenses for Tax Purposes in Japan?
I started a business in Japan and am searching for a company to which I can leave preparing an accounting book, invoices, and paying expenses. Can your accounting office handle them?
Our accounting office can help you with preparing an accounting book, invoices, paying expenses, etc.
I started a business in Japan and want to simulate my taxes in advance there. Can your accounting office assist me with this?
Our accounting office can simulate your business’s Japanese taxes for a few years.
I run a business as a web engineer in Japan, and I sometimes outsource overseas. Is this transaction taxed with Japanese consumption taxes?
Japanese consumption taxes do not tax overseas outsourcing expenses.
The Consumption Tax Risks When Outsourcing Work Overseas 海外に仕事を頼んだ場合の消費税のリスク：国内と国外どちらの取引か？
I am in Japan on a working holiday. Is there anything I should be careful about taxes?
Generally, people who stay in Japan on a working holiday are not taxed in Japan. However, if you want to lengthen your duration, you should be careful about remittance taxation in Japan.
Taxes Applicable When Coming to Japan on a Working Holiday ワーキング・ホリデーで来日した場合の税金
I started a business in Japan, but I do not know the etiquette for exchanging business cards there well.
The etiquette for exchanging business cards in Japan expresses Japanese culture well.
I started a business in Japan but need to learn how to call companies properly. Do you have simple tips?
You can call a Japanese company properly after reading the following.
I started a business in Japan. I have sometimes forgotten to get receipts for expenses. When it happens, what should I do?
In practice, you could claim expenditures as expenses by making a memo with the same contents as receipts.
What Should Individuals Running Businesses in Japan Do When They Forget to Collect Receipts?
I started a business in Japan and am going to visit a Japanese company. Is there anything I should know beforehand about Japanese business manners?
When you run a business in Japan, you are likely to see the unique manners of Japan, such as bows and business cards.
I wonder if I should start a business in Osaka. What is Osaka's uniqueness?
Osaka people have had a rivalry against Tokyo.
What You Should Know When Starting Business with Osaka Locals in Japan
I am trying to start a business in Japan. How different between Tokyo and Osaka?
Tokyo is the capital city of Japan. It leads to many differences.
Understanding the Cultural Differences between Tokyo and Osaka for Business Purposes
I established a company in Japan and started running a business there. However, I do not know how to deal with foreign exchange transactions in an accounting book. Could you teach me?
Companies must adequately recognize profit or loss from foreign exchange transactions for tax purposes in Japan.
How to Convert Foreign Currency Transactions in Accounting Books in Japan日本で帳簿を作る際の外貨取引の換算の方法
I heard about a fixed-amount tax cut in Japan in 2024. What is it like?
A fixed-amount tax cut in 2024 is a one-time treatment.
What Tasks Must Employers Do to Japan’s Fixed Amount Tax Cut 2024?
I am planning to start a business in Japan, but I don't know how to send emails there. Please tell me how to do this simply.
This Japanese business email style is fixed forms, so it is easy to use.
I run a business in Japan as a sole proprietor. I want to make rent and car-related bills expenses. Do you know about good ideas?
Though making all of them expenses is difficult, a part is available.
I started a business in Japan but don't know how to build deep relationships with Japanese businesspeople. Would you happen to have any suggestions?
In Japan, there are several unique ways to build deep relationships in the business world.
I have started a business in Japan and want to know which companies are more likely to be targeted by tax audits.
There are certain tendencies in companies where tax audits are conducted in Japan.
I have started a business in Japan and need to decide on a term of office for a director. Do you have good suggestions?
In most cases, it is ten years in small companies, which is the most extended term.
How long Should a President’s Term Be When Establishing a Company in Japan?
I run a business in Japan. I sometimes visit my home country. Is the cost of the trip considered a business expense for tax purposes?
There is room to be allowed an expense partly for tax purposes if you do business during your trip.
I heard the expenditure for suits is not considered an expense in Japan. Why?
The main reason is that you can use it for personal use when you are off.
Why Are Suits Not Considered Deductible Expenses by Japanese Tax Offices?
I heard tax audits are likely conducted when a sole proprietor incorporates a business in Japan. Is it true?
In Japan, tax audits are likely conducted when a sole proprietor incorporates a business. This is because the subject of tax responsibility changes from an individual to a corporation when incorporation occurs.
Tax Considerations When Transitioning from a Sole Proprietorship to a Corporation in Japan
I am planning to start a business in Japan and want to obtain business networking there. Do you happen to know suitable opportunities, such as business meetups?
When I started this office, I became a member of JCI.
Effective Business Meetups When Launching a New Business in Japan
I am planning to start a business in Japan. However, it is challenging to understand seals related to Japanese companies. Could you explain it easily?
The especially complex part is the difference between an individual seal and a representative seal of a corporation.
I started a business in Japan. What are the key points in preparing an accounting book in Japan?
In Japan, at least several conditions are required for tax purposes when preparing an accounting book. You may be subject to tax penalties if your accounting book does not meet these conditions.
Key Points to Consider When Maintaining Accounting Records in Japan 日本で帳簿を付ける時に気を付けるポイント
I live in Japan and run a business. Most of my clients are overseas. Are my sales taxed with consumption tax?
The conclusion is that your sales are considered export sales, which means they are taxed by 0 %.
The Consumption Tax Risks When Providing Services Overseas 海外にサービスを提供する場合の消費税のリスク：輸出？国外取引？
I run a business in Japan and want to file tax returns electronically. Is your accounting office available to it?
Almost all our clients file tax returns electronically, and we conduct all electronic tax filing procedures as a tax agent.
I want to leave preparing an accounting book to someone. Does this accounting office deal with that work?
Our accounting office is available to prepare accounting books properly, assuming tax audits will occur.
I want to know the actual conditions of tax audits by the National Tax Agency in Japan.
This report from the Japanese National Tax Agency is interesting to know the trends and interests of the agency.
I live and run a business in Japan. I am curious to know if I am within the range of Japanese inheritance taxation or not.
If you live in Japan, you are basically within the Japanese inheritance taxation range for all of your properties, including those abroad. However, there are exceptions.
Taxes in Japan for Receiving Inheritance or Gifts Across Countries 国を超えて相続や贈与を受けた場合の日本の税金
Should my business register with the Japanese Invoice System for consumption tax? Do you have any suggestions?
There are several factors you should know when deciding to register with the Japanese Invoice System.
Should New Businesses Register as a Taxed Consumption Tax Business or Not in Japan?
Is monthly book closing essential in Japan?
In Japan, all companies must close their books at least once a year to file tax returns. For most small companies, this is just this time, while large companies, such as listed companies, must do quarterly book closings. However, sometimes, monthly, quarterly, or six-month book closings are conducted to reduce or refund taxes at even small companies.
I am planning to start a private lodge business 民泊, Minpaku, in Japan. I heard I should be careful about VAT, consumption tax when starting Minpaku.
If you want to refund consumption tax, Japanese VAT when starting a private lodge business, Minpaku, you should know this limitation.
Consumption Tax on Real Estate Purchases by Private Lodging Businesses 民泊事業者が不動産物件を取得した際の消費税
I heard the Japanese inheritance tax is rather severe. What is it like?
If you live in Japan, you may have to pay inheritance tax because its non-taxed range is pretty low.
I have heard that Japan has launched a digital nomad visa recently. What is it like?
This visa was specially made for digital nomads who visit Japan.
I am planning on establishing a company in Japan. I would like to know how to calculate my Japanese taxes on the director's fee.
In Japan, income taxes on salary are calculated considering many factors, such as salary deductions and income deductions.
The System of Individual Income Tax in Japan: For Salaried Individuals
I run a business in Japan as a sole proprietor. What tools can I use to pay taxes?
In Japan, You, as a sole proprietor, can pay taxes in cash at the bank counter, by credit card, through internet banking, or in other ways.
How Do You Pay Taxes for Sole Proprietors for Individual Income Tax in Japan?
I heard about the per-capital levy against companies in Japan. What is it like?
In Japan, even if your company does not make a profit, per-capital levies are incurred according to the amount of capital.
Establishing Corporations in Japan: Understanding the Per Capita Levy Even in Deficit
I plan to get a Japanese management visa and run a business in Japan. What do you think I should know in preparing to renew the visa?
One of the most important terms for renewing a management visa in Japan is the financial health of your business.
Business Continuity During the Renewal of Management Visas in Japan
I am planning on establishing a company in Japan. Can you advise me on determining the capital amount?
You have to consider several aspects when determining the capital amount in Japan.
How much should the paid-in capital be when you establish a corporation in Japan?
I am planning on starting a business in Japan as a sole proprietor. Are there effective tax-saving ways?
Though the number of effective tax-saving ways for sole proprietors is fewer than that for companies, Japan has a few practical tax-saving ways for them.
Effective Ways to Save Taxes When Running a Business in Japan
I am planning on establishing a company in Japan. Are there effective ways to save taxes?
There are a few practical ways to save taxes in Japan, even though they do not become huge. In a way, they are simple, accumulating roads.
Effective Ways to Save Taxes When Running a Business in Japan part 2
I heard about the year-end tax adjustment in Japan. What is it like?
In Japan, employees are withheld income taxes from their monthly salaries. These tax amounts are temporary, so businesses that employ them conclude and settle income taxes when they pay their last wages at the end of the year. This is the year-end tax adjustment in Japan. In light of that, employees do not need to file tax returns unless they get other incomes.
I heard about remittance taxation in Japan. What is it like?
Remittance taxation may occur when your status for tax purposes is a non-permanent resident in Japan. It happens only when you get overseas income in the same year.
I plan to establish a corporation in Japan. Must the corporation enroll in social insurance even though it does not have employees?
Basically, all companies in Japan must enroll in social insurance. However, when all employees’ labor time is shorter than a certain level, such as a part-time job, there is no need to enroll in it. On the other hand, even the company that pays only the director’s fee must enroll in social insurance.
Do Foreigners Need to Join Social Insurance When Launching a Business in Japan?
I run a business as a sole proprietor in Japan. When I should incorporate it?
Incorporation has several advantages for tax purposes in Japan.
What Are the Advantages of Incorporation for Sole Proprietors in Japan?
I need help determining when I must start paying taxes and what income is taxed in Japan.
If you are not a resident of Japan, you must pay taxes on only domestic income in Japan. On the other hand, if you are a permanent resident of Japan, you must pay taxes on worldwide income.
I heard about the Invoice System in Japan. What is it like?
In Japan, businesses must pay VAT, consumption tax. It is calculated that paid tax minus received tax. The Invoice System rules how to deduct this paid tax.
I heard about withholding tax in Japan. What is it like?
In Japan, when a business pays salaries and fees to specialists, it temporarily keeps a certain presumed income tax and pays it to the government later.
Understanding Taxes When Starting a Business in Japan: Withholding Individual Income Taxes
I hear about the Blue-Form Tax Return system, 青色申告制度, in Japan. What is it like?
Applying for the Blue-Form Tax Return system in Japan can give you some tax advantages, but you must prepare a proper accounting book.
Filing Tax Returns in Japan: Importance of Blue-Form Submission and Deadline Compliance
What are the record-keeping requirements for businesses in Japan?
When tax audits are conducted, taxpayers must present all documents related to tax and accounting to tax officers. In addition, the Electronic Record-Keeping Law started in 2024 in Japan.
What Happens in Japanese Tax Audits if You Discard Ledgers and Documents?
I hear there is the Electronic Record-Keeping Law in Japan. What is it like?
What are the common tax deductions available for businesses in Japan?
If your company increases labor costs, excluding director’s fees, more than the previous year, the company can apply a certain tax deduction for corporation tax.
How do I apply for a tax ID number in Japan?
Japan does not have a tax ID number like in other countries, which is closely connected to an individual. However, there is a number used for electronic tax filing. On the other hand, corporations are delivered a tax ID number when they are registered.
What are the common challenges foreign businesses face in Japan?
First, opening a bank account is challenging for foreign companies when starting a business in Japan. Second, differences in Japanese business cultures lead to many difficulties. Hiring Japanese full-time directors or collaborating with Japanese companies are excellent ways to solve those challenges.
What are the penalties for late tax payments in Japan?
The rate is 5% if you voluntarily pay taxes before tax audits. If you pay them as a result of tax audits, it is 10% or 15%. The following provides more detailed information.
Can you assist with drafting and reviewing contracts in Japan?
Drafting and reviewing contracts are the domain of lawyers in Japan. Our office specializes in tax and accounting, but we are members of a group that supports foreign people and companies starting businesses in Japan. The group includes a lawyer.
What are the typical business expenses in Japan?
Necessary expenses when running a business in Japan are not different from those in other countries. These include labor costs, rent fees, social insurance, supplies expenses, and so on. Entertainment expenses might be relatively high because many Japanese business people are inclined to value personal relationships.
How do I navigate Japan's corporate tax system?
Taxation for Japanese companies is pretty complex. Therefore, almost all Japanese companies leave tax matters to a tax accountant in Japan.
How do I obtain the necessary licenses and permits for my business in Japan?
Administrative scriveners specialize in getting licenses and permits in Japan.
Our office specializes in tax and accounting, but we are members of a group that supports foreign people and companies starting businesses in Japan. The group includes a administrative scrivner.
How do I handle business travel expenses for tax purposes in Japan?
Business travel expenses are considered for tax purposes only when they range reasonably socially. Plus, you should prepare the travel expense inner rule to prepare tax audits.
Can you assist with setting up an e-commerce business in Japan?
Our office specializes in tax and accounting, but we are members of a group that supports foreign people and companies starting businesses in Japan. The group includes a web marketer and a website builder with broad knowledge of the Japanese web world.
What accounting standards are used in Japan?
In Japan, while listed companies use accounting standards that are almost international, most small companies use accounting standards for small companies. Therefore, it is rare to see allowances and provisions in a small company’s financial statement.
What are the tax obligations for foreign companies in Japan?
Corporation tax and VAT consumption tax are the primary obligations of foreign companies in Japan. The former is approximately 30% and the latter is 10%. If you’d like to know more about it, please take a look at the blog.
An Easy Explanation of Consumption Tax for Doing Business in Japan
What types of business structures are available in Japan for foreign entrepreneurs?
In Japan, many Japanese people initially start businesses as sole proprietors and incorporate them after making sufficient profit. Regarding foreign people, it is smoother to establish a company, if you must purchase a management visa. On the other hand, if you have a spouse visa, starting your business as a sole proprietor is no problem. Regarding the kinds of corporations, please take a look at the blog.
Do I need a local partner to start a business in Japan?
Opening a bank account is the most significant initial hurdle for foreign people and companies starting a business in Japan. If you have Japanese cooperation, like the company’s directors, it will be smoother at that time. Plus, if you want to run a business in Japan without staying in Japan, Japanese cooperation is essential.
How do I transfer profits from my Japanese business to my home country?
If you want to transfer profits that yield from businesses in Japan, paying dividends or directer’s fees is the way. Each way may be under double taxation. However, you can avoid it to some extent via a foreign tax deduction.
What are the costs associated with starting a business in Japan?
Starting a business in Japan as a company costs around 500,000 yen for registration. Obtaining a management visa costs around 300,000 yen. After opening a business, you must file tax returns, which cost at least 300,000 yen annually for hiring an accounting office. If you start a business as a sole proprietor, registration fees do not happen.
What are your accounting office's main services?
Our accounting office’s primary services are assisting in preparing proper accounting books, preparing tax returns that apply to tax audits and advising on proper tax savings and planning. If you want to know more about that, please refer to the page.
Koshida Accounting Office Fee Schedule