Japanese Business Glossary

贈与 (zoyo), gift or donation, involves the transfer of property or assets from one person to another without receiving anything in return.

In legal and financial contexts, zoyo can have specific implications, especially regarding taxes. For instance, in Japan, there is a gift tax (贈与税 = zoyozei) that applies to the recipient of the gift if the value exceeds a certain threshold.

Understanding what constitutes a gift or a donation is important for estate planning, charitable donations, and transferring assets within families. It is advisable to consult with a legal or financial expert to navigate the regulations and potential tax liabilities associated with gifts.

繰延資産 (kurinobe shisan) refers to costs that have been incurred but are not immediately expensed on the income statement, i.e., deferred assets. Instead, these costs are capitalized and amortized over a specific period of time.

Deferred assets typically include expenditures such as startup costs, development expenses, and large-scale marketing campaigns that provide benefits over multiple accounting periods. By deferring these costs, a business can spread the expense over the useful life of the asset, matching the expense with the revenue it helps to generate.

控除対象配偶者 (kojo taisho haiguusha) refers to a spouse who qualifies for certain tax deductions in Japan based on their income and other conditions. Typically, to be considered a spouse eligible for deductions, the spouse's annual income must be below a specific threshold. When a taxpayer claims their spouse as eligible for deductions, they can reduce their taxable income, thereby lowering their overall tax liability. This deduction is part of the measures to provide financial relief to families where one spouse has little or no income.

源泉徴収税額 (gensen choshū zeigaku) is the withholding tax amount. This term refers to the amount of tax that is withheld at the source of income, such as from an employee's salary, wages, or payments to contractors. The employer or payer deducts this tax amount from the payment and remits it directly to the tax authorities on behalf of the employee or payee. This system ensures that taxes are collected regularly throughout the year and helps to prevent tax evasion. The withheld tax is then credited against the total tax liability of the individual or entity when they file their annual tax return.

寡婦控除 (kafu kojo) refers to the widow's deduction. This is a tax deduction available in Japan for women who meet certain conditions, such as being widowed or divorced. The deduction is designed to provide financial relief to widows by reducing their taxable income, which in turn lowers their overall tax liability.

To qualify for the widow deduction, specific criteria must be met, such as not having remarried and having a dependent child or earning below a certain income threshold. There is also a special deduction for widows who are supporting a child. The amount of the deduction can vary based on these conditions.

ふるさと納税 (furusato nozei), Japan's hometown tax program, is a unique tax scheme in Japan that allows taxpayers to contribute to municipalities of their choice, rather than paying part of their local inhabitant tax to the municipality where they reside. In return, contributors often receive thank-you gifts, such as local products or specialties from the municipalities they support.

The scheme is designed to help regional areas in Japan by directing tax revenue to less populated or financially struggling municipalities. Taxpayers who participate in the furusato nozei program can receive deductions on their income tax and local inhabitant tax based on the amount contributed, within certain limits.