Japanese Business Glossary

In Japanese, the term 経費 (keihi) refers to "expenses" or "business expenses." These are the costs incurred in the process of running a business. Keihi can include a wide range of expenditures such as rent for office space, utilities like electricity, water, and internet, employee salaries and wages, office supplies, travel expenses, marketing and advertising costs, and depreciation of assets. Properly tracking and managing keihi is essential for maintaining accurate financial records, budgeting, and ensuring compliance with tax regulations. In Japan, businesses must be meticulous in documenting and categorizing their expenses to maximize tax deductions and maintain transparency with the tax authorities.

源泉徴収税 (gensen choshūzei) translates to "withholding tax" in English.

It refers to the tax deducted at the source of income, meaning the payer of the income withholds a portion of the payment and pays it directly to the tax authorities. This system ensures that taxes are collected in advance and helps to prevent tax evasion.

In Japan, withholding tax is commonly applied to various types of income, including salaries, bonuses, interest, dividends, and certain payments to non-residents. Employers, financial institutions, and other entities responsible for making payments must withhold the appropriate amount of tax and remit it to the National Tax Agency.

The rates and specific rules for withholding tax can vary depending on the type of income and the residency status of the recipient. For example, the standard withholding tax rate on salary income for residents is based on progressive tax rates, while non-residents might face a flat rate on certain types of income.

Properly managing withholding tax obligations is crucial for businesses operating in Japan to remain compliant with tax regulations.

控除 (kojo) is a tax deduction in Japan. It refers to the amounts that can be subtracted from an individual's total income to reduce their taxable income. By lowering the taxable income, tax deductions can significantly decrease the amount of tax an individual owes.

Various types of deductions are available, each designed to provide financial relief for specific circumstances. Common deductions includes those for dependents, medical expenses, social insurance premiums, and mortgage interest. For instance, the spousal deduction and dependent deduction help families reduce their tax burden by acknowledging the financial responsibilities of supporting a spouse or dependents.

To claim these deductions, taxpayers must provide the necessary documentation and meet certain eligibility criteria. Properly utilizing deductions are crucial for effective tax planning, as it can lead to substantial tax savings. Understanding and applying the appropriate deductions can help individuals manage their finances better and ensure compliance with tax regulations.

滞納 (tainou) refers to the failure to pay taxes or other required payments by the due date. This can lead to several consequences depending on the type of payment and the length of the delay.

For example, if national health insurance premiums are overdue, the individual might initially receive reminders and then a "資格証明書" (qualification certificate) instead of a regular insurance card, requiring them to pay medical costs upfront and seek reimbursement later. Continued non-payment can result in loss of benefits, such as high-cost medical expense coverage, and potentially lead to asset seizure if the overdue amounts remain unpaid​.

In the case of local taxes like resident tax, late payments result in additional charges called 延滞金 (entairyou), which accumulate daily based on the amount owed and the length of the delay. Persistent non-payment can lead to more severe actions, including the seizure of assets like bank accounts or property.

For fixed asset taxes, the penalties are similar. An initial interest rate is applied for the first month of delay, which increases significantly after this period. If payments are not made even after receiving several reminders, the authorities may ultimately seize assets to cover the unpaid taxes​

特段 (tokudan) is a Japanese term that translates to "special" or "particular" in English. It is used to describe something that is out of the ordinary or requires specific attention. For example, you might hear it in phrases like 特段の事情 (tokudan no jijou), meaning "special circumstances," or 特段の理由 (tokudan no riyuu), meaning "particular reason."

In business contexts, 特段 might be used to refer to exceptional conditions or considerations that need to be addressed separately from the usual procedures or rules.

担保 (tanpo) is a Japanese term that translates to "collateral" or "security" in English. In a financial context, 担保 refers to an asset or property that a borrower offers to a lender as security for a loan. If the borrower fails to repay the loan, the lender has the right to seize the collateral to recover the owed amount.

For example, when taking out a mortgage, the property itself often serves as the 担保. This practice helps lenders reduce the risk of lending money, as they have a way to recoup their losses if the borrower defaults on the loan.