スポンサーサイト

上記の広告は1ヶ月以上更新のないブログに表示されています。
新しい記事を書く事で広告が消せます。

--年--月--日 スポンサー広告 トラックバック:- コメント:-

legal rent

Companies often rent an apartment and provide this to its employees either as benefit or part of compensation. In such cases, because the employee receives economic benefit, the amount of taxes he/she bears increases (on a monthly basis because the rent is usually paid by the company on a monthly basis). However, as there are exceptions to all hard rules, there is an exception to this one too: if the employee bears a sufficient portion of the rent (usually done through payroll withholding), the employee faces no tax implications. This is what is known as legal rent.





Sufficient amount to be withheld from an employee’s paycheck is calculated as follows:

Sufficient amount = (Actual rent paid) x (certain percentage)

Question then is, how much should this certain percentage be? Many companies set this at a flat 10% (example 1 below), whereas aggressive companies set it at 5% (example 2 below) and conservative companies set it at 15% (example 3 below).

Example 1
Actual rent paid is 250,000 yen and the company applies a 10% rate
250,000 yen x 10% = 25,000 yen

Example 2
Actual rent paid is 250,000 yen and the company applies a 5% rate
250,000 yen x 5% = 12,500 yen

Example 3
Actual rent paid is 250,000 yen and the company applies a 15% rate
250,000 yen x 15% = 37,500 yen

What you must be aware of is that there is a risk involved in this calculation method. The risk materializes when the employee is not bearing sufficient portion of the actual rent paid by the company. But not enough based on what standard? This is the toughest part. The standard is computed using the assessed value of the apartment and the land for property tax purposes along with the total area of the property. Assuming that the three values have been collected, applying them to the examples 1 thru 3 above reveals the following result.

Assessed value of apartment for property tax purposes = 10,000,000 yen
Total area of property = 55 m2
Assessed value of land for property tax purposes = 11,000,000 yen

10,000,000 yen x 0.2% + 12 yen x 55 m2 / 3.3 m2 + 11,000,000 x 0.22% x 50% = 32,300 yen

The simplified calculation method introduced at the beginning multiplies a certain percentage on the actual rent paid and require employees to bear this amount. However, using the formal method reveals that 5% or even 10% withholding is not enough. Rather, the company needs to withhold 15% of the actual rent paid. If the company has neglected to withholding income taxes on the rent paid assuming that no tax implications existed because the employee has been bearing sufficient portion of the rent, the company may be in trouble. Because legal rent is an area where insufficient withholding is common, the Tax Office auditors will most likely look into the propriety of your company’s tax treatments.

Was this info helpful? Please support by clicking 人気blogランキングへ







スポンサーサイト

2007年01月29日 Taxes トラックバック:0 コメント:0

アルバイトの給与、正しく計算していますか?

人手が足りなくてアルバイトを雇ったものの、給与計算方法が分からない…。よくあることです。時給1000円で雇い、4時間働いてもらったから現金4000円を手渡して終わり…。よくあることです。でも、これではダメなんです。





給与を支払うときは、必ずと言っていいほど支払いをする側(事業主)が税金(所得税)を天引き(源泉徴収)しなければならないのです。この天引きをしないと、税務調査が入ったとき調査官と押し問答になります。

では、いくら天引きすればいいのだろう?天引きすべき金額は、「給与所得の源泉税額徴収表」を見れば分かるのですが、アルバイトの就労形態によって表の見方が「甲欄源泉」、「乙欄源泉」、「丙欄源泉」の3パターンに分かれています。甲欄なのか、乙欄なのか、丙欄なのかによって、天引きする金額が異なるのです。

「甲欄源泉」は、天引きしなければいけない金額が一番小さいです。ただ、甲欄源泉をアルバイトに適用させるためには、「給与所得者の扶養控除等(異動)申告書」がアルバイトから提出されてなければいけません。

なお、この用紙は主たる給与を得る事業所にのみ提出することになっています。なので、雇っているアルバイトが他でもアルバイトをしていてこの用紙を他の事業所に提出している場合は、給与所得の扶養控除等申告書の提出を求められないので、そのアルバイトには甲欄源泉は適用できません。乙欄源泉か丙欄源泉にならざるを得ないのです。

人気blogランキングへ一票。







2007年01月27日 Taxes トラックバック:0 コメント:0

Venture capital deals hit 5-year high

USA Today on January 23, 2007, venture capitalists invested $25.5 billion in 2006, a 12% increase from the $22.8 billion invested in 2005. The increase marks the biggest capital flow into start-up businesses since the dot-com crash raised concerns for venture capitalists five years ago. The increase was helped by a renewed boom of Internet start-ups, according to figures jointly released by a PricewaterhouseCoopers, Thomson Financial, and the National Venture Capital Association.





ということで、2007年1月23日のUSA Todayによると、2006年において、米国のベンチャー・キャピタリストたちは総額25.5兆ドルの資金をベンチャー・ビジネスに投資しました。これは、2005年の22.8兆ドルの12%増しとなり、主にネットビジネスの起業に再び火がついたことに起因するとのことです。実際、サンフランシスコのダウン・タウンにあるオフィスビルにはネットビジネスの起業家たちが多く押し寄せており入居率が著しく上がっています。

As the Japanese economy gradually improves, we can expect more entrepreneurs to embark on starting up businesses as well. そのとき、リスクを最小限に収めるためには会社を辞めずに起業することがもっとも望ましいことでしょう。週末起業フォーラム【無料】公式メルマガには、そんな安全性を重視しつつも「好きなこと」を追及して、それを自分だけのビジネスに展開する「週末起業家」となるノウハウと実体験が満載です。大きな収入を手に入れて、独立する人も続出しています。









Now, when entrepreneurs start up their own businesses, there are a few issues related to health insurance, workers’ compensation, and other insurances that they should be concerned with. Stayed tuned to WJA for more details.

人気blogランキングへ一票お願いします。

2007年01月24日 News トラックバック:0 コメント:0

travel time

I just arrived to Scottsdale, Arizona a few hours ago for a business event to be held from tomorrow thru Thursday. I left my apartment in the Upper East Side of Manhattan around 10:30 am, hopped on the 6 train to Grand Central Station, transferred to the cross-town S train to Times Square, and made another transfer to the 2 train to Penn Station. At Penn Station, for the first time in my life, I got on the NJ Transit which took me to Newark International Airport. Then I flew on Continental Airline to Phoenix, Arizona, and then to this hotel in Scottsdale, Arizona. The entire trip lasted about 10 hours. Then I thought to myself: can I take a day off from work for this time I spent traveling?





I don’t know what the policy is with my firm (I’m going to find out soon), but in Japan, Labor Standards Law Article 35 Paragraph 1 states that an employer shall provide its employees at least one day off from work per week. Put another way, the law doesn’t mandate a two-day-weekend (after all, if God only rested one day, why should we rest more? But good argument stands that Japan’s not a Christian nation). Basically, your employer can ask you to work on a Saturday as long as you take the Sunday off (not cool). But if you end up using that Sunday to travel from, say Tokyo to Singapore, in connection to work, now there’s a good chance your employer violated Paragraph 1 of Article 35. So in cases like these, many employers allow employees to take a day off on a future weekday.

Well, returning to my case, I'd still need to check my firm policy. But had I been working in Japan, the law doesn’t require my employer to give me a day off on another day as a make up since I didn’t work this past Saturday. Then I remembered, back at my old firm in Tokyo, our firm policy was that if we worked more than 8 hours a day on a Saturday, Sunday, or on a holiday, we were allowed to take a day off on any future weekday. Now that was cool.



2007年01月22日 Employment Law トラックバック:0 コメント:0

1.2 babies in her life time

厚生労働省が年内に公表する新しい将来推計人口で、今後長期的にみて、女性が生涯に産む子供の平均数が1.2人程度となることが分かった。2002年にまとめた前回推計では長期的にみた出生率は1.39程度に高まるとしていたが、これを現在より低い1.2前後と大幅に下方修正する。出産育児一時金の増加 などで、出生率の下押し要因となっている晩婚、晩産の改善を試みている厚生労働省だが、女性の自立、キャリア思考、そして右肩上がりの離婚率が続く現代においてはむなしい努力に終わるでしょう。Source: 12/17/2006 on NIKKEI NET





On average, women will give birth to 1.2 babies in their life time according to new findings by the Ministry of Health, Labour, and Welfare. This is a dramatic negative adjustment to the Ministry’s 2002 research where it predicted the figure to increase to roughly 1.39. The Ministry is taking measures to combat the social trend of late marriage and late birth through efforts such as increasing (dependents’) midwifery expenses maternity allowance but as women’s independence, career orientation, and the upward trend of divorce rates continue, the Ministry’s efforts are far from effective.

As the Japanese work force shrinks, it will become difficult for the country to sustain its position in today’s global economy, especially against Chinese and Indian work forces. Japan has only two ways to approach this national problem: to increase foreign workers or to adapt to a new domestic economy that is in balance with fewer workers. To increase and sustain a growing number of foreign workers, Japanese legal system needs to be more accessible to non-Japanese nationals. WJA strives to play such a role. To adapt to a new domestic economy in balance with fewer workers, Japan’s entire economy must be restructured. Only industries operating with economies of scale whereby productions can be highly automated will thrive. Jobs in industries requiring heavy labor such as agriculture and construction will be outsourced to foreign countries such as China and India. Labor hours of highly educated professionals such as doctors, lawyers, and accountants will only increase as they stretch their short supplies to meet public demands. Sounds pretty bad doesn’t it? That is why I believe Japan will increase the number of foreign workers and why I believe WJA will serve your interest.





Note: The English version of リーガルレント will be posted late in the week as I will be on a business trip to Scottsdale, Arizona.

2007年01月22日 News トラックバック:0 コメント:0

リーガルレント

従業員に対する福利厚生または報酬の一環として会社がアパートを借りて、これを役員や従業員に貸す場合があります。この場合、その従業員は会社から経済的利益を享受しているので、本来その分負担しなければいけない税金が増えます。しかし、会社が、アパートを貸している従業員から一定の金額を受け取っていればその従業員が負担する税金は増えないというカラクリがあります。これがいわゆる「リーガルレント」や「法定家賃」と呼ばれているものです。





問題となる従業員の給与から引くべき「一定の金額」は次のように計算されます。

 一定の金額 = 実際の支払賃料 × 一定割合

この一定割合がクセモノです。多くの企業はこれを一律10%(下記例1)しているようですが、積極的なアプローチを採用してこれを5%(下記例2)、消極的なアプローチを採用してこれを15%(下記例3)とするところもあります。

 例1
 実際の支払賃料が月額25万円で、一律10%とする場合、
 250,000円×10% = 25,000円

 例2
 実際の支払賃料が月額25万円で、一律5%とする場合、
 250,000円×5% = 12,500円

 例3
 実際の支払賃料が月額25万円で、一律15%とする場合、
 250,000円×15% = 37,500円

知っておかなければいけないことは、この計算方法にはリスクが伴うということです。それは、従業員が負担している一定の金額が少なすぎる場合です。何を基準に少なすぎるか?これが面倒なのです。家屋の固定資産税の課税標準額、敷地の固定資産税評価額、そして家屋の総床面積の3つの数字を引っ張ってこなければいけないからです。これらを何とか引っ張ってきたとし、上の例1~3について当てはめてみましょう。

 その年度の家屋の固定資産税の課税標準額 = 10,000,000円
 その家屋の総床面積= 55㎡
 その年度の敷地の固定資産税の課税標準額 = 11,000,000円の場合、

 10,000,000円×0.2% + 12円×55㎡/3.3㎡ + 11,000,000 ×0.22%×50% = 32,300円

最初の簡単な計算方法を使用している場合、実際賃料に一定の率を掛けて、その金額を従業員の給与から控除してこれでよしとしています。しかし、面倒な計算方法を使用した場合、10%または5%の控除では足りず、実際は15%の控除をしていなければならないことになります。税務調査が入った場合、リーガルレントは源泉漏れの疑いがかかりやすいので、積極的なアプローチを採用している場合は税務調査で引っかかるリスクも当然高くなります。

人気blogランキングへ一票。







2007年01月21日 Taxes トラックバック:0 コメント:0

社労士+特技=強豪

社会保険労務士は、弁護士や公認会計士など他の士業と比較するとどうしても知名度が劣っているのが現実です。歴史の浅さや業務範囲の狭さ、華やかさに欠けるところや億単位の業務案件が皆無と言ってよいことなど、様々な要因が絡み合ってのことでしょう。そんなことから、ちまたでは社労士なんかじゃ食っていけない、などと叩かれます。





しかし、私が考えるところ「士業」とはその名通り、「士」のつく「職業」であり、士とは男子、特に学問・道徳を修めた男子についていうと同時に、さむらい・武士、の意味を含んでいます。士とは男子、特に学問・道徳を修めた男子についていうと同時に、さむらい・武士、の意味を含んでいます。そして、武士とは戦国の時代において、帯刀し、武芸をもって君主に仕えた者をいいます。思うに、弁護士であっても会計士であっても、弁理士であっても社労士であっても、一つの学問を修めた者であることに違いはなく、また、その知識を武器とし、高い見識をもって君主・社会に仕えることにも違いはありません。違うのは武器として備えた知識であり、武士に例えるならそれは刀を持つ者、槍を持つ者、斧を持つ者、短刀を持つ者という具合の違いでしかないでしょう。

では、仮に弁護士が刀、会計士が槍であり、社労士が短刀だとした場合、いかにして刀よりも槍よりも戦場において活躍し君主・社会に仕えることができるでしょうか。それは、短刀の軽さゆえ腕力のない人間でも十分に扱える特性にもう一つ特性を加えることだと思います。脚力に磨きをかけ敵地へ素早く突入し相手の喉下を掻っ切ること、二刀流術を身につけ同時に二人の敵を葬り去ること、その小型さゆえそれを飛び道具として相手の急所目掛けて投げることなど、知恵を絞れば応用術はいくらでもありそうです。

ならば、社労士という資格にさらにもう一つの特技を加えてはどうでしょうか。多くの人は税理士や行政書士を身に付け二刀流になっています。私の場合、それを英語に見出しました。社労士という武器に英語という特性を加えることによって、この武器を私、そして私と同じ特性を加えた社労士でしか振り回せない領域が出来ました。日本で働く外国人、外資系企業の人事担当者、そして外資系企業をクライアントに抱える社労士に仕えることです。それは、戦国時代から現代に時代を進めるならば、俗に competitive advantage などといわれるものです。



2007年01月18日 Employment Law トラックバック:0 コメント:0

sure your kid’s making less than 1.3 million yen?

Many people are mistaken that your monthly health insurance premium (社会保険料) increases when you have the government issue health insurance certification cards (健康保険被保険者証) for your dependents (扶養者). Introduced earlier in ”figuring out you’re your social insurance premium” the amount of monthly health insurance premium deducted from your paycheck is computed based solely on your compensation using a ”table”. The number of family members you claim as dependents and have the government issue health insurance certification card has no effect. Good news so far, but the government recently began taking actions to periodically reassess whether the dependents you claimed for your health insurance purposes really qualify as dependents.





Under the Health Insurance Law (健康保険法) and interpretations by the ” Social Insurance Agency (社会保険庁)”, the family member you plan on claiming as your dependent for health insurance purposes must have an annual gross income of less than 1,300,000 yen (approximately $10,800).

Until recently, once a dependent was claimed on an employee’s health insurance, that dependent continued to receive health insurance coverage benefits until the employee, through its employer, filed with the Social Insurance Agency that that dependent no longer needs coverage under his/her name. What often happened as a result was that many college graduates who didn’t begin working full time upon graduation remained covered by his/her parents even though he/she was earning more than 1,300,000 yen through part time jobs. The goal of the recent move by the Social Insurance Agency is to stop spending money on these people. Totally makes sense and I support the movement.

Was this info helpful? Please support by clicking 人気blogランキングへ







2007年01月16日 Social Insurance Law トラックバック:1 コメント:0

paycheck and tax

Under the Japanese Income Tax Law(所得税法), salary income(給与所得) includes salaries and wages, bonuses, and allowances. Common allowances include allowance relating to cost of living, education allowance for children, medical allowance, tax allowance relating to gross-up, and housing allowance. Fringe benefits such as interest free or low interest loans are also included in salary income. Unfortunately, salary income is one of the 10 income categories subject to tax withholding.





The amount of withholding tax is calculated with reference to 給与所得の源泉徴収税額表 or Table for Withholding Tax on Salary Income. Please note that the Table has been renewed as of January 1, 2007 due to the termination of 定率減税 or a fixed rate tax deduction, an automatic tax deduction, which has been in effect for the past years. Using the Table, the amount of tax withhold from your monthly paycheck is determined based on (1) your monthly salary including all allowances and fringe benefits valued at fair market value, (2) whether you have submitted the annual 給与所得者の扶養控除等(異動)申告書 or the Deduction for Dependents Report, and (3) the number and health conditions of dependents claimed on the Report.

(1) Because the Japanese tax system uses the progressive rate system(累進課税制度), the more salary you earn the more amount of tax will be withheld from your paycheck. (2) To minimize your withholding tax (and increase your net pay), you should always, and I can’t emphasize this enough, submit the Report to your HR by January 1 of each year. Strictly speaking, without your Report in hand, HR is technically required to withhold more tax from your paycheck. (3) Also, if you’re financially supporting your parents, siblings, and relatives, you should claim them on your Report unless they’re claimed on someone else’s Report (you can’t claim your parents as your dependents if your older brother claims them as his dependents). Your dependents don’t have to be in Japan like it is in the US. If you’re sending money over to your aunt in Vietnam, claim her as your dependent. But be careful. I’ve seen a few Chinese nationals working in Japan who claimed their entire family and relatives in China as dependents. If those people were really supporting all those people and could prove it to the Tax Authority when they come knocking on their door for tax audits than that’s fine. But if they were simply abusing the system, they’d be in deep shit if caught. It is important to know that there is a line between tax minimization and tax evasion.

Was this info helpful? Please support by clicking 人気blogランキングへ







2007年01月15日 Taxes トラックバック:0 コメント:0

taxes aren't voluntary

A famous jurist by the name of Judge Learned Hand once said:





“Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible(節税をすることはそれ自体何も悪しきことではなく、それは裁判所が都度都度指摘するところである). Everybody does so, rich or poor; and all do right(裕福・貧困を問わず誰もが行うものであり), for nobody owes any public duty to pay more than the law demands(誰しもが社会に対し法が求める以上に税金を納める義務など負っていないのである): taxes are enforced exactions, not voluntary contributions(税金は強制的に徴収されるものであって、任意的な寄付ではないのだから). To demand more in the name of morals is mere cant(モラルの名の下に必要以上の納税を求めること事態が馬鹿げたことであるとしか言いようがない).” [Commissioner v. Newman, 159 F2d 848 (Ca 2, 1947)]

This kind of attitude may not be welcomed in the yet bureaucratic(未だ官僚的な) Japan. But I am a big supporter of this saying and this type of attitude is at the very basis of every article introduced in WJA.

Was this info helpful? Please support by clicking 人気blogランキングへ







2007年01月14日 Taxes トラックバック:0 コメント:0

W-2 forms

I presume you’ve all returned to work by now. Beginning of the year in Japan normally starts off by drinking sake at the office, visiting customers for a new year’s greetings, and going to nearby shrines. The HR department, however, is still in the midst of its busy season. No time to be sipping sake at their desks. Under the Japanese Income Tax Law (所得税)employers are required to issue the Japanese version of W-2 forms (源泉徴収票)by January 31st of each year to be distributed to their employees as well as to the municipal government offices that have jurisdiction over their employees’ place of residence.





The Japanese W-2 form is the result of the year-end adjustment performed by your HR or by another person or entity your employer outsourced its payroll functions to. The form indicated your age, the number of dependents you are claiming and their age and health conditions, your gross income, income deduction, taxable income, life insurance premiums paid, non-life insurance premiums paid, social insurance premiums paid, mortgage payments paid, income tax withheld up to your last paycheck, income tax that should’ve been withheld according to the information you submitted for year-end adjustment, and the difference as refund or additional withholding. All in all, it’s a copy of your tax return.

This form becomes important if you want to file a more detailed tax return separate from the year-end adjustment. Because the year-end adjustment is designed as a one-size-fit-all simplified tax return for salaried employees, it only takes into consideration of salary income and disregards other sources of income such as interests, dividends, rental, business, capital gains, and property sales. It also disregards itemized deductions such as charitable contributions, medical expenses, capital losses, to name a few. Therefore, if you have sources of income other than salary from your employer, you’re more than likely than not to be required to file a separate tax return by March 15th. Even if you don’t have other sources of income, filing a separate tax return is the only way you can claim additional deductions and increase your tax refund. And the Japanese W-2 form must be attached to the separately filed tax return to be accepted by the tax office (税務署)that has jurisdiction over your address.

Was this info helpful? 人気blogランキングへ







2007年01月13日 Taxes トラックバック:0 コメント:0

workers' compensation

All of us, at one point in our lives, experience injury at work. But not all of us know that many of these work related injuries can be compensated. Workers’ Accident Compensation Insurance(労働者災害補償保険法)Article 2 states the purpose of the law as “compensating employees incurring personal injury, disease, disability, or death by accident arising out of and in the course of employment as well in the course of commuting to work.”(「業務上の事由または通勤による労働者の負傷・疾病・障害・死亡等にたいして…保険給付を行」う)





Under this law, you’re eligible for compensation if you sprain your ankle while moving boxes at work or fall off a ladder and need stitching. You’re also eligible if you slip and fall off the stairs at a train station while commuting to work. Now don’t think “cash” just because you see the word “compensation” because the compensation is generally in the form of free medical treatments(現物給付)at designated hospitals(指定病院). But if you’re not paying money out of your pocket for services you’d normally be required to pay for, it’s compensation for sure (and the value of the service is tax-free). So if you’re injured at work, take advantage of the system. It’s there for you.

In order to receive free medical treatment at a designated hospital, you need to submit a claims form(療養補償給付(療養給付)たる療養の給付請求書)to the hospital. This form is generally filled out by your company’s HR or by a Certified Social Insurance and Labor Consultant your company hired to perform periodic services. You may also want to know that at times, the compensation you receive through this system may not be enough to cover all your medical costs. This can occur if the initial injury you sustained at work triggers complications that the designated hospitals consider not to have direct connection with the initial injury and because there are limits as to what type of treatments qualify under the system. If have reasonable expectations that you’re more likely than not to be in this unfortunate category, you may want to protect yourself through additional private insurance



2007年01月12日 Employment Law トラックバック:0 コメント:0

at-will employment

A little more about employment at-will. In U.S., whenever a fired worker claims that his or her discharge was unlawful, whether under a statute or a common law doctrine, an employer may escape liability by demonstrating that the sole reason for the discharge was “good cause.” Defining “good cause” for termination is a formidable task but there have been attempts to do so.





The drafters of the Model Employment Termination Act (Model) defined “good cause” as meaning (i) a reasonable basis related to an individual employee for termination of the employee’s employment in view of relevant factors and circumstances which may include the employee’s duties, responsibilities, conduct on the job or otherwise, job performance and employment record, or (ii) the exercise of business judgment in good faith by the employer, including setting its economic or institutional goals and determining methods to reach those goals, organizing or reorganizing operations, discontinuing, consolidating, or divesting operations or positions or parts of operations or positions, determining the size of its workforce and the nature of the positions filled by its workforce, and determining and changing standards of performance for positions. National Conference of Commissioners on Uniform State Laws, Model Employment Termination Act Section 1(4) (August 8, 1991).

As you can see, the Model was drafted back in 1991, more than 15 years ago and I’m sure there have been further efforts to refine the meaning of “good cause” since then. I intent to share new findings as they come to my attention so stay tuned to WJA.



2007年01月11日 Employment Law トラックバック:0 コメント:0

tax return

April 15th is a real dread in US, another tax return to file with the damn IRS. Good news is that the dread is much lighter in Japan. In Japan, in December of each year, employees’ salaries throughout the year undergo something called year-end adjustment performed by the HR in your company or whomever your company outsourced its payroll functions to. For most people, this year-end adjustment is in itself the tax return.





Because year-end adjustments are performed by your HR (or by another person or entity your company outsourced its payroll functions to), you don’t have to touch a thing. All that is asked of you is to give the necessary information to the HR by an internally designated date (usually mid November to early December). In most cases these information are your (1) life and non-life insurance premium payments, (2) social insurance premiums (usually National Pension Insurance premiums) you paid for your family members and dependents, and (3) mortgage payments.

Where can you get these information yourself? (1) Proof of life insurance and non-life insurance premium payments are sent to you by your insurance companies (if you’re looking for insurance companies, here are some helpful sites: Insurance Clinic and Medical Insurance).

towards the end of the year. (2) You receive a receipt every time you pay social insurance premiums so keep these till year-end. (3) Proof of mortgage payments are sent to you by your mortgage company, usually a bank in Japan. After you gather these information, you enter the amounts into a designated form called Insurance Premium Deductions for Salaried Personnel and Special Spouse Deduction for Salaried Personnel (給与所得者の保険料控除申告書兼給与所得者の配偶者特別控除申告書), print your name and address on the bottom, and stamp your seal. Many companies also ask you to complete Declaration of Dependents for Salaries Personnel (給与所得者の扶養控除等(異動)申告書) to confirm your dependents for deduction purposes. You probably have completed the same form at the beginning of the year (and might ask why you have to do it again). The purpose is to reflect the most updated information in the year-end process because your family structure might have changed during the year.

After you submit all necessary forms and information, your HR will punch out your tax liability for the year and compare it against how much has already been withhold from your monthly salary. If withholdings exceeds tax liability (which is most likely the case) you’ll receive a refund on your December paycheck. If your tax liability exceeds withholdings (does happen once in a while) you’ll see more tax deducted from your paycheck than normal months. Together with your January pay slip your HR will provide you something called 源泉徴収票 which is an official copy of the details of your year-end adjustment.



2007年01月09日 Taxes トラックバック:0 コメント:0

commuting allowance is only half tax-free

Back in our fathers’ days (I say father because very few mothers worked back then), your father would look at his pay slip and find numerous “allowances” that reflected his job responsibilities, family structures, and family situations: executive allowance (役職手当) for employees with executives titles, child up-bringing allowance (養育手当) for employees with young children, alimony allowance (別居手当) for employees living separately with his spouse to carryout work away from home, vacant home allowance (留守宅手当) for employees who were sent abroad and left his home vacant, etc. Good for our fathers. But today, these allowances are becoming ancient as the concept of annual salary becomes wide spread. However, there is one allowance that we continue to, and will probably continue to see on our pay slips: commuting allowance (通勤手当).





The best thing about commuting allowance is that its tax free (非課税), well almost. I say almost because for one thing, there is a general limit (上限) of 100,000 yen per month. But not many people commute 4 hours a day one-way to work so we don’t need to worry about that. The second thing, and probably the more attention worthy, is that although commuting allowances are tax free, they are subject to social insurance and employment insurance premiums. Mentioned earlier in “figuring out your health insurance premium”, you’re health insurance premium is calculated based on standard remuneration (標準報酬月額) which is based on your monthly salary range. What commuting allowance often does is push your monthly compensation into a higher monthly salary range thereby increasing your monthly social insurance premium. Employment insurance premium is not calculated based standard remuneration and is straight forward: your total monthly salary multiplied by the premium rate. Commuting allowance increases your employment insurance premiums because it is included when computing the premium.

Question then is, should you take the commuting allowance for tax savings or should you not take it for social and employment insurance premium savings? I say take it because you get to take the train for free, if your destination is between your home station and work station. If your shortest train route doesn’t have stations that you normally go on weekends with friends and significant other, say, Aoyama for shopping or Shinjuku for language school, try choosing the next shortest route (but be prepared to justify your reason). In many cases, the benefit of that far outweighs expected social and employment insurance premium savings.



2007年01月08日 Taxes トラックバック:0 コメント:0

beaten paycheck

Ever wonder what and how much gets deducted from your monthly pay? You’d be disgusted to find out. Withholding national income tax (7.5% for purposes of this article but actual rate differs for each individual due to progressive tax rate system) throws you a punch and then inhabitant tax (1% for purposes of this article but actual rate differs for each individual) follows with a jab. Health insurance premium (8.2%) whacks you in the head and welfare and pension insurance premium (7.321%) throws you an uppercut. To finish you off, employment insurance premium (0.8%) tackles you down. At the end of every month, you’re paycheck is beaten down to roughly 75% of its gross amount.





This withholding and deduction from your pay is made possible by Labor Standards Law Article 24 which states that partial deduction from wages is permitted in cases where it is allowed by law (income tax law, inhabitant tax law, health insurance law, welfare and pension insurance law, employment insurance law, etc.) or agreed upon by the employer and its employees in written form.

There are, however, several ways to decrease withholdings and deductions and preserve as much gross pay as possible. One way is by claiming as much family members as possible as your dependents for tax purposes. If you’re parents are retired and live off pension, you may want to claim them as your dependents. This will lower the amount of income tax withheld from your gross pay. But be careful. Don’t abuse the system by claiming as dependents family members that you’re not supporting in any way (like uncles and aunts, nephews and nieces outside Japan). You’re in deep shit if the tax authority audits you finds that you’ve intentionally abused the system. By deep shit, I mean monetary penalty and possible jail time.

Another way to protect your gross pay is by increasing your tax refund at year-end. There are several ways to achieve this but one common way is by utilizing insurances (保険クリニック) Stay tuned to WJA for details on for more ways to protect you paycheck from being beaten down.



2007年01月06日 Taxes トラックバック:0 コメント:0

certified social insurance and labor consultant exam

Nationally administered Certified Social Insurance and Labor Consultant Exam (社会保険労務士試験) is a rigorous exam. Exam pass rate for the past 10 years have been 8.52% on average (about 8 to 9 examinees out of 100). Within the past 10 years, the lowest was 1997 where 1,991 out of 28,124 examinees passed (7.08%), and the highest was 2002 where 4,337 out of 46,713 examinees passed (9.28%).





The exam consists of two parts: multiple choice (択一) (Part I) and fill-in (選択) (Part II). In the past years, there have been 70 multiple choice questions where an examinee is given brief information in short sentences or paragraphs and then must choose the correct answer out of the given 5 choices. There are 8 fill-in questions where in each question an examinee is given a few paragraphs of information with 5 blanks in it. The examinee is then asked to fill in those 5 blanks from a set of 20 given terminologies.

Examinees are tested on their knowledge and understanding in 10 areas in the employment and social insurance law arena: Labor Standards Law, Labor Safety and Health Law, Workers’ Accident Compensation Insurance Law, Employment Law, Law on Collection of Labor Insurance Premiums, general knowledge and understanding of human resource management including other related laws, Health Insurance Law, National Pension Law, Welfare and Pension Insurance Law, and general knowledge and understanding of social insurance including other related laws. The exam preparation time can be anywhere from 6 months to several years. I (religiously and insanely) devoted 6 months of my senior year in college preparing for the exam and was fortunate to pass it on first try. It becomes harder for those that have full-time jobs and may take anywhere from a year to several years.

There are two passages to become fully licensed after passing the exam. Candidates may acquire 2 years of experience in the employment and social insurance law practice to register with the Certified Social Insurance and Labor Consultant Association (Association) and become fully licensed. This 2 years experience may be before of after passing the exam. Another passage is by participating in the training program administered by the Association. Upon proving their experience or completion of training to the Association, candidates can register with the Association (with some fee) and become licensed to practice in public.



2007年01月05日 News トラックバック:0 コメント:0

selling your PTO

I mentioned earlier in “time off” about how you’re eligible to receive paid-time-off (PTO) (有給休暇) from work. Another issue that often pops up related to PTO is having your employer buy back your unused PTO when leaving the company (有給休暇の買戻し). This is a common practice in U.S. and many foreign companies (外資系企業) in Japan as well as some domestic companies (日本企業) apply similar practice.





This practice may be foreign to you if you’ve never seen or heard of it before, but in a nutshell, you’re employer will buy back whatever amount PTO you weren’t able to use up by the time you leave the company. Let's say after you’ve accrued 26 days of PTO you decide to leave your current employer because you landed on a better job. As also mentioned earlier in “resignation notice: 2 weeks US, 1 month Japan”, you give your employer 1 month advance notice about your intent to quit. But say there are only 22 business days in the month to come. In addition, your employer wants you to finish up the tasks you’ve been working on and also to train someone in your function as your successor (後任者). You expect this to take at least 2 full weeks, or 14 business days. What just happened is that you physically can’t use up your accrued PTO (of the 22 business days, you’d be coming in at least 14 days leaving you with a maximum of 8 days PTO you can use by the time you leave). Without company policy to buy back those extra PTO’s you’d end up throwing away the remaining 18 PTO’s that you’ve worked so hard to earn. Does that sound fair? Hell no, and that’s exactly why some companies installed PTO buy back practices.

Now, how much you can trade your unused PTO’s in for depends on each employer. Currently, Labor Standards Law (労働基準法) does not set any standards for PTO buy backs (it was never in the culture of Corporate Japan because employees were not expected to leave) and leave the practice up to employers. Some employers divide your annual salary by the number of business days in a year to arrive at your daily salary and deem that to be the value of your PTO for a day. Some employers use similar methods but multiply your daily salary by a certain percentage to calculate the value of your unused PTO. In many cases the details are written in your employer’s employment handbook (就業規則) so you may want to obtain a copy of it from your HR. Labor Standards Law requires that employment handbooks be accessible, at all times, by employees.

Was this info helpful? 人気blogランキングへ







2007年01月03日 Employment Law トラックバック:0 コメント:0

you're fired! not!

“You’re fired!” reflects America’s at-will employment doctrine (自由雇用主義). In U.S., absent statutory or contractual restriction (法令または契約による制約がない場合は), an employee or employer can terminate the employment relationship at any time, for any or no reason, with or without notice (雇用主は被雇用者をいつでも、どのような理由でも、予告の有無を問わず、解雇することができる). Therefore, employers have the power to control its workplace and workforce by terminating employment relationships at will. In turn, employees retain the freedom to resign if better employment opportunities came by or if working conditions became intolerable.





This concept was introduced by H.G. Wood’s treatise on the master-servant relationship articulated in 1877. Woods wrote that “With us the rule is inflexible that a general or indefinite hiring is prima facie a hiring at will (一般的または期間の定めのない採用は自由雇用と推定されることは当然であり), and if the servant seeks to make it out a yearly hiring, the burden is upon him to establish it by proof (もし被雇用者がそれを年間契約と解したい場合、それが年間契約であることを彼自身が立証する必要がある). A hiring at so much a day, week, month, or year, no time being specified, is an indefinite hiring, and no presumption attaches that it was for a day even, but only at the rate fixed for whatever time the party may serve (日間、週間、月間、年間、または期間の定めがない採用も、無期限の契約であり、その契約が1日であることすら推定することはできず、ただ、決められたレートによって必要な期間だけと採用したもと解される).” (H. WOOD, MASTER AND SERVANT § 134, 3d ed. 1886) Despite being challenged and negated at times, this rule has since been the primary basis for what constitutes the at-will employment of today. Various reasons have been suggested as to why U.S. courts supported this concept but most convincing is that the at-will doctrine fit the times (時代に適合した). Late 1800’s was a time of industrial revolution and the at-will doctrine reflected the ideology of laissez faire and freedom of contract.

Japan, on the other hand, denies employers’ right to terminate employment relationship at will. Labor Standards Law (労働基準法) Article 18-2 states that “a dismissal, where it is objectively unreasonable and is not considered socially appropriate, shall be deemed as an abuse of power by the employer and shall be held void.” As a result, employers are restricted their power to control their workplace and workforce through termination of employment relationships. In turn, employees are well protected by law. “You’re fired!” is often followed by “not!” as imposed by laws and court rulings.

Was this info helpful? 人気blogランキングへ







2007年01月02日 Employment Law トラックバック:0 コメント:1

compensation for not working

Fact: you may be eligible for cash benefits when you become unemployed.
Amount: 149,760 to 575,550 yen if you’re under the age of 30 and 149,760 to 852,000 yen if you’re between the ages of 30 and 45.
Conclusion: not a bad compensation considering you’re not working.





The primary purpose of employment insurance (雇用保険) isn’t to ensure that you’re employed at all times (wouldn’t that be nice) but to provide you cash benefits while you’re unemployed to alleviate financial hardship. So, when you become unemployed and meet certain conditions, you’re eligible to claim cash benefits.

The first of those conditions is that you’ve been covered by employment insurance (被保険者であったこと) for more than 6 months during the past year until you became unemployed. Most legitimate employers are registered with employment insurance so you’d be covered in most cases. The 6 months doesn’t have to be on a continual basis with the same employer. It can be collective (通算) from more than one employer (for example, 2 months from employer A and 4 months from employer B).

The second condition is that you’re not just bumming out. Public Employment Security Office (PESO) (公共職業安定所), government agency in charge of employment insurance, want to see that you have the will and the ability work (労働の意思及び能力). You can prove so by showing them that you’ve been to a few job interviews or by other means that shows you’re trying to find a job.

Now, the juice. For those under the age of 30, the minimum amount is 149,760 yen and the maximum amount is 575,550 yen. For those between the ages of 30 and 45 and that have worked more than 10 years for an employer registered with employment insurance, the minimum is 149,760 yen and the maximum is 852,000 yen. Where you fall within these ranges depends on how much you’ve been earning in you recent job. But best of all, these benefits are tax free!

Note
Because claiming benefits under employment insurance is complex and detailed, it is advisable to consult a Certified Social Insurance and Labor Consultant before taking any action that may affect you. Feel free to contact me at tkamii@kamii-holdings.com for referral to your local Certified Social Insurance and Labor consultant.

Was this info helpful? 人気blogランキングへ







2007年01月01日 Employment Law トラックバック:0 コメント:0

上記広告は1ヶ月以上更新のないブログに表示されています。新しい記事を書くことで広告を消せます。