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Payroll Calculation

1.Payroll Calculations

- In Japan, employers are the designated payer of taxes and social insurance premiums including the amount to be borne by staff.
- Employers pay salary to staff after withholding taxes and insurance premiums from salaries.
- Payroll calculations are needed for computing the accurate amount to be paid to staff after subtracting taxes and premiums that are imposed on staff.

Flow of Payroll Calculations
Monthly work (i) Calculation of the gross salary (for each employee).
(ii) Calculation of the amount to be subtracted.
(iii) Payment of salary after subtraction.
(iv) Payment of health insurance premium, withholding income tax, and residential tax.
Annual work

April: submission of notifications regarding social insurance and employment insurance, change of premiums for health insurance and nursing care insurance.

May: annual change of premiums for labor insurance.

June: annual renewal of the special collection tax (meaning the amount of residential tax to be paid by the employer in place of the employee).

July: annual renewal of labor insurance, notification on the calculation basis for social insurance, and bonus calculation.

October: annual change of premiums for employees’ pension insurance.

December: year-end adjustment for withholding income tax, bonus calculation.

January: submission of withholding slips, salary payment report, and statutory statements.



Note

  • Errors in payroll calculations lead to employees’ distrust of employers.
  • Such errors would also indicate employers’ mismanagement in payments of taxes and insurance premiums.

2. Services

1. Summary of Services

 If you are hiring staff in Japan, we provide payroll calculation services. Our services include calculation of monthly payments to staff and income tax accounting, as well as attendance management (keeping track of employees’ work hours, leave records, etc.) and transactions for year-end adjustments.

2.Fees

Please feel free to contact us for details. We submit quotes after confirming the details of your plans and needs with you.

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