Business start-up and tax compliance services

When foreign corporations establish their business bases in Japan to start up operations, they face various issues and procedures that must be considered, such as the selection of offices and banks, advice for entity establishment (e.g., branch or corporation), filing various reports with the tax offices, and enrollment in the social insurance and labor insurance systems. At the initial stage of setting up operations, it may not be economical to hire personnel who are knowledgeable of the above procedures.

PwC Outsourcing Services LLC can provide a variety of one-stop services to foreign corporations doing business in Japan, in cooperation with PwC Tax Japan and PwC Labor and Social Security Attorney Corporation and law firms, if required. Our services include undertaking accounting and tax related administrative work, as well as tax consulting services. According to each client’s particular needs, we can introduce lawyers, banks and real estate agents necessary. High quality services are provided through PATHFINDER by utilizing the PwC global network and overseas PATHFINDER groups.

Advice for entity establishment

By reviewing company information and policies and interviewing key company personnel, we can provide the necessary advice to determine the best business structure in Japan to satisfy each company's business development and tax strategies. (We will work with law firms in regards to company registrations.)

Submission of tax reports to tax offices

After completing the company registration, we can prepare the various tax reports and other required reports depending on the nature of business. In addition, we can provide advice on consumption tax issues, including whether the company should elect to be a consumption taxpayer, if applicable.

Labor and social insurance procedure

The social insurance system, (including health insurance, long-term care insurance and welfare pension insurance), and the labor insurance system (including employment insurance as well as workmen’s accident compensation insurance), applies to newly-established companies. We can perform necessary administrative procedures for such companies to enroll initially into the social insurance or labor insurance systems at that time and for its employees at the time they are hired or resign from the office.

There is a requirement to file a report each year for the purpose of calculating the social insurance premium, and to submit an approximate calculation of and a final return for the labor insurance premium.

We can perform the troublesome task of preparing documents necessary for the enrollment of and cancellation of any social insurance or labor insurance aspect, and submitting them to the regulatory agency on behalf of the client.

We can also provide consulting services with respect to various issues related to the social insurance system.

When a company employs 10 or more employees, it is required to prepare and file “Rules of Employment” with the appropriate administrative office. Currently, labor management issues including working hours, mental health, sexual / power harassment, resignation/discharge, and duty not to compete have become important. For the purpose of preventing labor related problems before they occur, we can prepare work regulations, other various rules, and employment agreements, all of which reflect the corporate philosophy of the client.

PwC Labor and Social Security Attorney Corporation is able to provide labor insurance-related services.

Salary calculation

In accordance with the salary structure of each company, we will calculate the gross salary, withholding tax, social insurance, and labor insurance, etc. for each employee, from which we will calculate the net salary of each employee and prepare a salary breakdown. Upon the client’s request, we can execute the net salary and bonus allowance payments to the employee’s bank account, and make payment of the withholding tax and inhabitants tax on behalf of the client.

In the event of an employee resignation, we can take appropriate administrative measures to collect withholding tax from the retirement allowance paid to the resigned employee.

We can also provide annual services including the year-end withholding tax adjustment procedures, preparation of a salary and withholding tax statement, as well as the salary payment report for inhabitants tax purposes and its submission to the local tax office, and preparation of a schedule that provides a breakdown of any salary, compensation, and rent paid out during a given fiscal year.

In some cases, the net salary amount of an employee being assigned from an overseas entity (including economic benefits such as company housing and/or utility costs), is determined in advance. In such event, the need arises for a gross-up calculation under which withholding tax paid by the employer is included in the employee’s taxable income. We are able to apply our know-how in conducting such gross-up calculation.

Visa application

Transferring employees of foreign corporations to Japan requires a visa for entrance into Japan. We can assist in the visa application procedures, (i.e. providing necessary information and preparing documents for filing.)

Preparation of books and accounting records

We can provide services related to the preparation of the general ledger and sub-ledger based on the accounting records, by using the chart-of-accounts provided by the client. These services include bookkeeping services based on invoices and receipts and the preparation of a monthly Trial Balance, Balance Sheet and Income Statement. We can notify the client of any potential tax risks in advance by verifying that the accounting records that we prepare for the client is tax compliant. At the end of each fiscal year, we can also prepare financial statements that should be attached to the final corporate tax return. In addition, we can prepare reporting packages to be submitted to the client’s head office located overseas.

Tax compliance services

Our tax compliance and outsourcing services vary to suit each client's particular circumstances. Tax outsourcing services can be expanded to include full scope of tax outsourcing, strategic and planning functions as well as tax reporting, forecasting and managing the client's relationship with the tax authorities.
We deliver managed tax compliance outsourcing including:

  • Preparation of tax returns and tax reports for corporate tax (including consolidated corporation tax filing), consumption tax, etc.
  • Preparation of tax returns for individual income tax purposes, including tax returns for foreign nationals seconded to Japan or Japanese nationals who are seconded overseas.
  • Attendance at tax audits, including the negotiation of complex technical issues with the tax authorities and strategies for dispute resolution.
Corporate secretarial services

Upon the request of the client, we can prepare registration documents related to establishing a company (including a branch of a foreign corporation) and dissolving a company, board of directors’ meeting minutes or the shareholder’s meeting minutes for each term, registration documents related to a change of officers, and other various documents related to the company’s operations, as well as provide other advisory services. Corporate secretarial services will be provided in cooperation with outside lawyers and/or judicial scriveners. (Outside lawyers and/or judicial scriveners will take care of commercial registration procedures and related legal work.)

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