FAQ

All businesses in Japan are required to keep accounting records for Japanese tax purposes. This includes financial documents that show your business transactions, such as invoices, receipts, bank statements, financial statements, agreements and so on.

Businesses operating in Japan are subject to inspection by the tax office. Therefore, all accounting records must be retained as they can be used for your protection should there be any question or challenge.

A financial statement is a statement of the financial position of your company. It includes a balance sheet and a profit and loss account.

The main purpose of the financial statements is to enable management to analyse how the business is performing and to make the right strategic decisions.

The financial statements are also used to calculate taxes and are submitted with the annual tax return.

Therefore, they are one of the most crucial financial records that all businesses must prepare and maintain.

An accounting standard is a set of practices and policies used to prepare financial statements. In Japan, Japanese Generally Accepted Accounting Principles (GAAP) are used.

However, this creates a problem for overseas based companies. When it comes to group consolidation, Japanese GAAP financial statements cannot be combined with those of the parent company. Therefore, Japanese GAAP financial statements need to be converted using international accounting standards (IFRS).

No worries, we've got you covered. With a solid IFRS background, JPUK Accounting solutions can prepare financial statements in both accounting standards.

The new invoicing system was implemented on 1 October 2023. It applies to all businesses in Japan.

Invoices are issued when businesses sell goods and services. Each item of goods and services is subject to consumption tax.

In Japan, different rates of consumption tax (mostly 10%, 8%, exemption) apply depending on the goods and services sold.

The new invoicing system sets out rules for the layout of invoices so that the appropriate tax rate is applied to goods and services.

Any errors on invoices could result in your customers being charged the wrong amount. This could affect the credibility of your business.

Conversely, if there is an error in the supplier's invoice, you may end up paying the wrong amount for the goods and services you have purchased.

JPUK Accounting Solutions can help to ensure that invoices are prepared correctly.