Payroll in Japan can get quite complicated with basic wages, overtime and bonuses less deductions for income tax, residents tax, health insurance, over 40 health insurance, pension and labour insurance, not forgetting the employer’s contribution to employees’ health insurance, pension and labour insurance. Then of course you not only do you have to pay employees their net wages, you also have to pay the income tax withheld to the tax office, the residents tax to the local tax office, the health insurance and pension to the health insurance and pension office and labour insurance to the labour office all by the due dates having filled out the correct forms. Finally, at the end of the year you must prepare the end of year tax adjustment and withholding tax certificate. So why would you want to make it harder?
Many employers in Japan outsource the whole payroll function to an external accountant and there are even licenced social insurance consultants (sharoushi) who specialise in this work and are well worth considering if you don’t have the time or inclination.
Certainly when it comes to preparing the annual tax return, nearly all businesses hire a tax accountant to get the job done but surely a business should be able to calculate its employees wages without also having to hire outside help if it so wishes. So here are my tips to help you manage your own payroll:
Xero accounting software is currently running a great offer:
- Free until 31 March 2016
- 50% off for six months after that
Available versions are:
- Starter - normally about 2,400 yen p/m, now about 1,200 yen for the first 6 months
- Standard - normally about 3,600 yen p/m, now about 1,800 yen for the first 6 months
- Premier - normally about 4,800 yen p/m, now about 2,400 yen for the first 6 months
See www.xero.com/pricing for more information or ask me. To catch this offer, you must sign up with me by 31 March.
Read More »
Most businesses need to engage a tax accountant to help them prepare and lodge a tax return at the end of each financial year. I also recommend that businesses with employees should generally get a Japanese tax accountant to prepare the employee payroll, or at least have a Japanese tax accountant on call for questions and the end of year tax adjustment.
I have come across a quite a few Japanese tax agents with a various skills, services and fees so it pays to find one which suits your requirements. I recommend you consider the following when choosing a Japanese tax accountant:Read More »
WorkflowMax is an integrated, online all-in-one project management software program. It handles the whole process from lead to quotes, job management, time-recording, purchase orders, invoicing and reporting all in the cloud. It’s a Xero product and so integrates well with Xero accounting software. Find out more at www.workflowmax.com or ask me for a demonstration.Read More »
Business owners like to get into some overly complicated or even dodgy deals from time to time, which may be OK if you’re on your own but may not, in my opinion, be such a good idea if you employ staff. “Tone at the top” is what auditors call it: owners should be leading by example to encourage staff to work hard and to help prevent their staff from committing fraud and other unethical practices.Read More »
There once was a time and place when making payments from your bank account also produced almost automatically a nice little booklet containing all the necessary information about such payments: date, payee, description and amount. This was called the cheque book system which, interestingly, has never existed in Japan as far as I know. As part of writing out the cheque, you also wrote out a cheque stub with all these details and ended up with little booklets of 25 to 50 cheque stubs which were a vital part of your bookkeeping records. At the end of each financial year, you could present all your cheque stub booklets to your accountant and off he’d go and happily prepare your accounts.Read More »
In all the old versions of MYOB, it was impossible to enter Japanese characters, which probably didn’t bother most users in Australia but was a little frustrating for us in Japan. On the other hand, old versions of MYOB have tended to work better for us than in Australia as most new features were tax and payroll related which are of limited use in Japan. Well, MYOB has now been rewritten on a different code base to allow for future cloud migration which has brought with it some new features which will help Japanese users, not least that MYOB now accepts Japanese characters!Read More »
Have you ever been quoted a price, agreed on it and then charged a higher amount? It’s not a nice experience and it’s easy to feel you’ve been tricked. The law is clear in Japan, Australia, Britain and probably elsewhere: When you give a price estimate or agree on a price, you should make it very clear whether consumption tax is included or excluded, otherwise, if you don’t make it clear, then the customer has every right to assume the price includes tax. There’s nothing difficult about this, just decide on a policy and stick to it.Read More »
Online banking is revolutionizing bookkeeping in the west where you can easily download transactions straight from your bank’s website into your accounting program and upload payments from your accounting system to your bank, thus saving time and increasing accuracy.Read More »