Payroll Services for Foreign Companies in Japan

Providing Flexible Payroll Services

JMC provides flexible payroll services for our clients in Japan, including businesses based in other countries. Our goal is to custom-tailor each client’s payroll services to fit their specific needs. A JMC-certified social insurance consultant can cover the payroll needs for companies of all types and sizes operating in Japan. In addition to assisting you with your payroll system in Japan, JMC can also provide services related to various payroll taxes as well as payment of salaries to Japanese employees’ accounts. These topics can be confusing to someone who is not familiar with the Japanese tax structure, so it’s best to let our experts help you. Our bilingual payroll experts can even help foreign companies with Japan Social Insurance and Japan Labor Insurance compliance.

Payroll management for companies in Japan

Initial Payroll Services

  • Registration of your company with Japanese Labor and Social Insurance Systems
  • Enrollment of employees in Japanese Labor and Social Insurance Systems (Please note that initial registration with Japan Social Insurance and Japan Labor Insurance can only take place after the company has been registered with relevant tax authorities.)
  • Master payroll data file setup
  • Set up a dedicated bank account for payroll-related payments (see JMC cash management services)
Payroll services for foreign companies in Japan

Monthly Services: Payroll Calculation

  • Calculation of gross salary, salary deductions, and net salary

  • Preparation of the following reports:
    – Payroll summary for company management approval
    – Payroll statement for the employee
    – Pay-in slip of national withholding tax

  • JMC can also provide “gross up” payroll calculations for foreign employees’ payroll in Japan. In cases like these, the company can increase employee compensation to offset the cost of Social Insurance and Labor Insurance deducted from the employee’s salary.

Monthly Services: Payroll Payment

  • Payment of salaries to employees
  • Payment of relevant payroll taxes and withheld taxes on employees’ salaries
  • Cash management services in Japan
  • Filing with Social Insurance and Labor Insurance offices to keep company and employee registration current. For example changes of address, changes in salary, bonuses, etc.

Yearly Payroll Services

  • Bonus Payment services
  • Additional year-end payroll work including year-end withholding and tax adjustment procedures (December)
  • Preparation and filing of the Annual Withholding Tax Report for National Tax Purposes (i.e., Shiharai-Chosho-Gokeihyo) and Annual Salary Report for Local Tax Purposes (i.e., Kyuyo-Shiharai-Hokokusho) with the national tax office and local tax office, respectively, by January 31
  • Preparation and filing of the labor insurance premium annual report (July)
  • Preparation and filing of the social insurance premium annual report (July)
  • Filing or renewal of the Article 36 yearly submission for overtime to the Labor Standards Bureau.

For Further Details About Payroll in Japan

Operating a business in Japan can present many challenges, even for the most seasoned foreign businesspeople. No matter how much experience you have in the U.S. market, it can help to have the advice of a seasoned veteran when you are setting up a Japanese office. As a foreign businessperson, not only will you have to deal with the language barrier, but you will also be confronted by cultural differences that can make it difficult for you to get your foot in the door. Hiring a consulting firm like JMC can give you all the tools you need to be as successful in Japan as you have been in the U.S.

The team at JMC has more than 30 years of combined experience in international business and we are prepared to assist you with a range of services including payroll management for foreign companies interested in incorporating in Japan. We have seen the issues faced by other businesses breaking into the Japanese market and we can help you avoid them. Our work has put us in contact with Fortune 500 companies around the world and now we want to work with you on your next international business venture.

If you need to set up a payroll system in Japan, our team can offer you the knowledge we have obtained over decades in the international business community. Of course, our work doesn’t end when your payroll system is set up. That is why we can provide you with ongoing payroll services and support like payroll management, accounting, tax withholding, and so much more. Get in touch with us today to find out more about all the payroll services we offer or to set up a consultation with our experienced and knowledgeable team members.