Additionally, if you do not do everything right, you could suddenly be hit with multiple year’s worth of back payments for taxes or other mandatory government-related expenses which can cripple a business. The Japanese government also announces new changes and an accountant can explain the system to you rather than you spending hours figuring it out – for example, the new changes to the invoice retention system that started on January 2024.
Cost Effective
Whether you’re a sole proprietor, self-employed australia phone number library person, or owner of a corporation, you’ll need to review documents and make sure of their plan and record-keeping. If you own a business, you’ll also need to know your financial forecast, so you can always be up-to-date and survive. As you know, this all adds up to more time spent, which also means more money spent. Instead of spending your valuable hours on taxes, have an accountant in Japan help you, so you can save both time and money.
Get the Most Out of Tax Reduction
If you’re the owner of a business, you’ll want to get all the benefits you’re entitled to, and a tax accountant can help you get all of them. They will handle all the forms needed, such as the ‘Blue Return’ form which is a form for sole proprietors you can submit two months after your business has been authorized.
If this form is accepted, you can receive up to 650,000 yen deduction to reduce your taxable business income which is great considering most businesses will need some support in their first year. If this form isn’t filled out properly, you run the risk of getting less than you deserve, so have your accountant handle all of it for you, and get the most out of your tax reduction!
Read more about tax reduction on our dedicated page Tax Reduction in Japan.
To learn more about how you can reduce your taxes this year, check out our video on the new qualified invoice system in Japan.
What does a tax Accountant in Japan do?
Now that we’ve discussed who should get a tax accountant and the primary reasons for getting one, let’s talk about what a tax accountant in Japan can do for you in further detail.
Tax Strategy and Advice
Having a tax strategy optimizes your business’ comparison of the best email marketing tools: paid plans revenue and helps you feel financially secure and independent by having a plan to reduce your taxes. It has to be designed in advance to take advantage of all its benefits. Having a strategic approach to your tax situation can save you money to invest back into your business, stocks, or other investments. A tax accountant in Japan can get a financial evaluation of your situation so you can better understand your position and goals.
Besides guidance in tax strategy, a tax accountant in Japan will also give advice on the best approach to your taxes. Their expert knowledge ensures you that, as you grow over time, so do your personal or business investments.
Government Subsidies
There will be times when you can receive subsidies from the government. A tax accountant can assure you of the proper subsidies available at any moment.
A special subsidy, for example, was approved earlier this year that supported businesses that suffered financial losses due to the Covid-19 pandemic. A tax accountant in Japan can evaluate whether or not you would be eligible for subsidies in Japan.
To learn more about Subsidies in Japan from an expert, check out our startup episode on How to get Government money for your business!
For more information on government subsidies, you can check out the National Tax Agency of Japan. They have an English website that has a lot of information on subsidies and tax systems, including one called the Grace System.
Year-End Tax Filing for Sole-Proprietors and Corporate Businesses
The end of the financial year is a very busy period for businesses and sole proprietors. For non-tax practitioners, it can get quite confusing to deal independently with various deadlines, calculations, adjustments, and application procedures.
Tax Auditing
In line with Covid-19 measures, tax investigations have become less traditional, e.g. online investigations, which has improved the efficiency of tax audits. It’s important to keep up with the current, especially as a business owner or sole proprietor.
International Tax Support
A tax accountant in Japan can make international endeavors a lot easier by offering international tax consulting. Whether you’re already a foreign company or looking to expand to other foreign countries, you’ll definitely want the advice of a tax accountant. These services include “Withholding tax treatment”, “Permanent Establishment (PE)”, “Antitax Haven Measure (CFC rules)”, “Foreign Dividend Exception Systems”, and “Tax Treaties”. You would have to find a firm that supports international tax as most Japanese firms do not.
How a Tax Accountant Can Help with Post-Incorporation Filing in Japan
After incorporating a company in Japan, businesses face a multitude of mandatory filings and registrations that are essential for legal compliance and smooth operation.
Tax Office Filings
One of the primary responsibilities of a tax accountant is managing filings with the tax office. By ensuring accurate and timely submissions, the accountant helps the company avoid penalties and ensures compliance with Japan’s tax regulations.
Local Tax Filings
In addition to national taxes, businesses in Japan must also register for local taxes with the prefectural and municipal offices. They also monitor payment schedules to avoid late fees and interest charges, thereby maintaining the company’s good standing with local tax authorities.
Social Insurance Enrollment
A tax accountant assists with the critical task of enrolling the company in social insurance systems, which include health insurance, employee pension insurance, and worker’s compensation insurance. This involves preparing and submitting detailed forms to the relevant pension offices.
Labor Standards and Employment Insurance
Compliance with labor standards and employment insurance regulations is another area where a tax accountant is indispensable. They manage the documentation and reporting related to labor conditions, social insurance status, and employment insurance registration. This includes submitting reports to the Labor Standards Inspection Office and the Public Employment Security Office, confirming that the company adheres to all legal requirements.
Regulatory Compliance
For businesses that require specific licenses and permits, a tax accountant can assist in identifying these needs and managing the application process. This ensures that the business operates within the legal framework and avoids any regulatory pitfalls.
Accounting Contracts
Accounting contracts or bookkeeping contracts is an agreement between a company or client and the accountant that protects your legal rights and clearly outlines each party’s responsibilities. A retainer allows access to services on a recurrent basis set of hours per month. This is the best option if you need routine tax services.
- Pay a fixed fee: Some projects are best to negotiate a set fee upfront, for example, for your first-time audit, or if you only need a year-end tax report.
You can also mix and match between these contracts, paying for some services via a fixed price and others on a monthly fee.
You may want to check out the following software if you need to provide tax files yourself. The biggest accounting software in Japan are:
Yayoi Kaikei or Yayoi Accounting
Yayoi Accounting is a cloud-based Japanese software that can automate and improve accounting procedures. It has simple but necessary functions and is primarily useful for those just starting their business or those with smaller businesses. Their smart transaction upload system saves time manually inputting receipts and statements through automatic uploads of data such as bank statements and credit card statements. Besides this automation, Yayoi Accounting also does tax analysis and auditing, and they offer email and telephone support.
Pricing
Yayoi Accounting offers the whole first year for free! After that, prices start at ¥26,000 per user, per year.
Money Forward (MF) Cloud Accounting
Money Forward (MF)’s Cloud Accounting is a software that automates troublesome tasks similar to Yayoi Accounting.Just like Yayoi Accounting, MF also offers tax advice. Unlike Yayoi Accounting, however, MF is more like a databank so they also offer other services besides accounting like payroll management.
Pricing
Update : MF also provides medium business plan for ¥5980 per month or ¥59760 per year (¥4980 per month).
Accounting Automation with Money Forward
I have been researching accounting automation to reduce the amount of manual data entry and items needed monthly for our accounting in Japan. Money Forward offers a pre-paid credit card that synchs up with their account software, so rather than mixing your business and personal expenses through your personal card, you can use this prepaid card just for business purchases. This will help you cleanly separate the two and make it much easier for your accountant in Japan and yourself to organize your expenses.
The only downside of this card is that they do not provide it to US citizens due to FATCA. However, if this does not apply to you check out the Money Forward credit card here.
Free
It has automated functions like automated credit card receipts and the inclusion of invoices and expenses. Its biggest selling point, however, is that it has automated alerts for anything you input, such as omissions or errors you may have entered, so you’ll never have to worry about penalties or filing your taxes wrongly.
Pricing
Freee offers a 30-day trial, after which the prices start at ¥4,480 per month or ¥47,760 per year (¥3,980 per month).
English Accounting Software in Japan
Although you will eventually need to attach belize lists your financials in Japanese on your tax return, there’s absolutely no need to use Japanese accounting software in Japan to keep your records. Here are some services you can use to keep your tax records in English, which you or your tax accountant should be able to translate for your final tax reports. Please confirm with your tax accountant in Japan if they support non-Japan-made software as many will not use the following software to manage your bookkeeping.
