Tax Accountant Tokyo - Outsourcing, Japan INBOUND - Yamajo International Tax and Accounting office.

Tel:+81-3-6273-1330
【Working hours】9:00 ~ 18:00 (Japan time, GMT+8)

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Establishing a Representative Office in Japan. →Fee for start

Generally speaking, a foreign company can establish a presence in Japan as a Representative Office. The purpose of the Rep. Office is limited to gathering information etc.

Under the Foreign Exchange and Control Law in Japan, it is not required for a Rep. Office to any registration, approval and reporting for establishing.

However, if the Rep. Office commence a trading then it will be a PE (Permanent Establishment) from the tax point of view. After that the Rep. Office will be a BRANCH office and it is required to register as a branch. A Branch Office has a tax obligation for Japan source income.

-> Rep office vs Branch

1. Report filing requirements.

If a Rep office hire staff, the following report filing will be required.
Items Report
File with
1. Social Securities Report on the social securities, unemployment insurance and Labour insurance.
Social securities
- Social securities office
Labour insurance
- Labour standard authority
Unemployment insurance
- Hello work
 
2. Paying Salary Report on the establishment of a salary payment office for withholding tax purposes.
National tax office

2. Payroll and Bookkeeping.

Many companies are controlling for Rep Office's Book in the Accounting Department of the Head-office. It must be appropriated to small office in foreign country.

However, payroll in Japan is very complicated for the head-office, especially in Expatriates' calculation, it would be suggested to ask OUTSOURCING for payroll.

3. Cash management and payment service.

1) Rep office cannot open a bank account.

Representative office does not have a "company status" so a Bank account of a Japanese bank cannot open for them.

Note: Although a foreign company can open a Non-Resident bank account at some bank, but it is treated like a foreign bank account and bank charges are very expensive so it is not appropriate to use for a routing cash management for a Japan Rep office.

This is the case, the cash management can be handled by a bank account of the head-office or a personal bank account of a Representative of the Japan Rep Office. However, due to avoid expensive bank fee and an internal control purposes, it should be not realistic.

2) Payment service for your Japan Rep office.

Payroll is complicated as this is necessary Japan withholding tax and social insurance deduction.  I addition to the above, monthly payment of local resident tax of staff is mandatory.

Such a timer consuming jobs should be outsourced as Rep staff should be concentrated into Japan market development without wasting time matters.

In case your Japan Rep office hire a specialist for administration jobs who execute routine works in English, whose annual salary would be JPY 4-5M.  Again, outsourcing would be cost saving option for a small entity of a Japan rep office.

【We can provide such a service as your Japan admin department.】

We are doing such jobs and are reporting to your controller/CFO directly in English. Your head-office's reporting format is usable for a monthly report depending on your requirement.

Sample of a monthly schedule is here.

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