Japanese employee HR and payroll services

Japanese HR and payroll services

Reliable Japanese payroll and HR services ensure your Japanese company’s employees are paid correctly and on time each month, that each employee’s withholding tax, local inhabitants tax, statutory Japanese health, pension and unemployment insurances and statutory Japanese workers accident insurance, are correctly calculated, and all other labor-related needs are professionally managed. Our payroll and HR services include the following benefits:

  • Knowledgeable and experienced in Japanese employee HR and payroll management and reporting.
  • Payroll services can include payment using a proxy bank-account operated by Venture Japan.
  • Includes a detailed monthly pay-slip in Japanese for each employee and a monthly summary spreadsheet, with detailed breakdown of withheld amounts, for the employer.
  • Statutory mid-year adjustments for employee health insurance, pension insurance and labor insurance, completed by licensed social insurance professionals.
  • Statutory year-end withholding tax adjustment for each employee, completed by licensed tax professionals.
  • Supported day-to-day with a full range of bilingual Japanese business support services.
  • Low monthly fees.
  • Can be ended at any time, without cause, simply by giving 30-days notice.

Being paid on time each month is possibly the most basic expectation any Japanese employee has of his or her employer. The second most basic expectation is that his or her employer correctly calculates, withholds, and pays his or her withholding tax, local inhabitants tax, statutory Japanese health, pension, long-term care, and unemployment insurances, and statutory Japanese workers disability insurance, and that he or she has a valid employee’s health insurance card, including cards for the employee’s dependents.

Japanese companies must calculate national withholding tax for each employee and withhold it from his or her salary each payday. The company then pays the withheld tax to Japan’s National Tax Agency on or before the 10th day of the following month. If the company has a “Blue Form” tax status, it can accrue the withholding taxes to pay to the National Tax Agency at the end of each calendar half-year (on or before July 10 for the first half-year and on or before January 20 for the second half-year). The city tax offices calculate inhabitant’s tax (local income tax) based on the employee’s previous year’s wages and inform him or her each June of the amount to be deducted and paid in the following 12 months. The company then deducts each employee’s local inhabitant tax from his or her pay each payday and pays it to the relevant city tax office at the start of the following month.

Japan’s social insurance scheme is mandatory for all employees, including full-time directors and representative directors. Every Japanese company must register itself as an employer and must register each of its employees in the social insurance scheme. Each month the company calculates each employee’s health, pension, long-term care, and unemployment insurance premiums, deducts them from the employee’s salary on payday, and pays the health and pension insurance premiums, together with matching employer’s contributions, to Japan Pension Service at the end of the month. The company estimates annual unemployment and worker’s accident insurance premiums for the period April to the following March, pays the premiums in advance each June, and each June adjusts the previously paid estimated premium to show the wages employees actually earned in the calculation period.

Most Japanese employees receive their wages on the 25th day of each month, or the closest workday before the 25th day if it falls on a weekend or national holiday. Japanese companies are so reliable in paying their employees on time each month, that employees’ payments for rent, housing loans, personal loans, insurances, and many other recurring monthly personal commitments, are timed for the 25th. If an employer pays its employees even one day late, it can cause significant problems for the employee. If it repeats such late payment, it will usually cause an employee to resign and search for a more reliable employer, and will give basis for a disgruntled employee to start a legal action that he or she will very likely win.


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