Japanese Business Glossary

減価償却 (genka shokyaku) refers to depreciation in Japan, the accounting process of allocating the cost of a tangible asset over its useful life. This method recognizes the gradual decrease in value of assets like buildings, machinery, and equipment due to wear and tear, usage, and obsolescence.

In accounting,* genka shokyaku* (depreciation) allows businesses to spread the expense of an asset over several years, matching the cost with the revenue generated by the asset. This process provides a more accurate representation of an asset’s value and the company’s financial position.

Several methods can be used for calculating depreciation, including the straight-line method and declining balance method. The choice of method and the specific rules governing depreciation, such as useful life estimates and residual values, are determined by Japanese tax laws and accounting standards.

Implementing depreciation helps businesses reduce their taxable income by accounting for the decreasing value of their assets. Properly managing depreciation is essential for compliance with tax regulations, accurate financial reporting, and effective long-term financial planning.

The term 公売 (kobai) refers to a public auction or sale conducted by the Japanese government or local authorities. These auctions are typically held to sell off assets that have been seized due to non-payment of taxes or other debts. The assets can include real estate, vehicles, valuable items, and other property. The proceeds from these sales are used to settle the outstanding debts owed by the original owners.

Public auctions are announced in advance, and anyone can participate, including individuals and businesses. The process is designed to be transparent and competitive, ensuring that the assets are sold at fair market value. Interested buyers must register to participate in the auction, and they may be required to pay a deposit to bid on certain items. Successful bidders are usually required to complete the purchase within a specified time frame.

Public auctions serve as a means for the government to recover unpaid taxes and other debts efficiently while providing opportunities for buyers to acquire assets at potentially lower prices than the market rate. This system also ensures that the sale process is conducted fairly and openly.

The term 連帯債務による借入金の額 (rentai saimu ni yoru kariirekin no gaku) refers to the amount of borrowed money under joint and several liability. In Japan, joint and several liability means that multiple borrowers are collectively responsible for repaying a debt. Each borrower is individually liable for the full amount of the debt, not just their share.

When a loan is taken out under this arrangement, all parties involved are equally accountable for the repayment. If one borrower fails to pay, the lender can demand repayment from any or all of the other borrowers. This type of liability is often used in situations where co-borrowers, such as business partners or family members, take out a loan together.

The amount of borrowed money under joint and several liability is important because it determines the financial responsibility of each borrower. Lenders prefer this arrangement as it reduces the risk of non-payment by having multiple sources to recover the loan from. For the borrowers, it means a shared obligation, where each person must be prepared to cover the entire debt if necessary. This legal concept ensures that lenders have a higher chance of recovering the loaned amount, while borrowers need to carefully consider the implications of such an agreement.

退職金 (taishokukin) refers to a retirement allowance or severance pay in Japan. This is a lump-sum payment given to employees upon their retirement or departure from a company. The purpose of retirement allowance is to provide financial support to employees as they transition out of the workforce, acknowledging their years of service and contributions to the company.

The amount of severance pay can vary significantly based on factors such as the length of employment, the employee's position, and the company's specific policies. In many cases, companies have structured retirement plans that outline how the amount is calculated. These plans may consider the employee's final salary, years of service, and other relevant factors.

Receiving a retirement payout can have tax implications, as it is often subject to preferential tax treatment in Japan. The tax rate on a retirement payout is typically lower than regular income tax, reflecting its role in supporting retirees. This preferential treatment helps ensure that retirees receive a larger portion of their severance pay, aiding their financial security during retirement.

Overall, retirement allowance is an important component of the Japanese employment system, offering a measure of financial stability and recognition to employees as they conclude their careers.

印紙代 (Inshidai) refers to the revenue stamp fee in Japan. This fee is required for various legal and official documents, including contracts, agreements, and certain applications. Revenue stamps are used to pay this fee, and the amount varies depending on the type and value of the document.

For example, when incorporating a company, specific documents may require revenue stamps, and the cost can range from a few hundred to several thousand yen. The revenue stamps can be purchased at post offices and some convenience stores.

The purpose of the 印紙代 is to ensure that the documents are legally recognized and taxed appropriately.

納税 (nozei) means "tax payment" in Japanese. It refers to the act of paying taxes to the government. In Japan, businesses and individuals are required to pay various types of taxes, including income tax, corporate tax, consumption tax, and others.

For businesses, understanding and complying with tax obligations is essential. Taxes must be filed and paid within specified deadlines to avoid penalties. It is important to maintain accurate financial records and stay informed about the current tax laws and rates.

Tax payments are a crucial aspect of running a business in Japan, ensuring that the business operates legally and contributes to the nation's economy.