Freelancing can afford you freedom and flexibility, but it also requires you to organize your own finances. This article will help you understand how to invoice for freelance work in Japan. We’ll look at:
- Freelance invoice layout in Japan
- Invoicing companies vs invoicing individuals
- How to keep track of your income
- Other tips
Invoices and Tax
Both consumption and income tax in Japan are generally charged at 10%. You might pay less or more, however, depending on the prefecture you live in and the amount of money you earned throughout the year.
1. Freelance Invoice Layout in Japan
Japanese resumes have a specific format, and so too do invoices. Luckily, you can very easily generate an invoice using Japan Invoice Template. The website also has a glossary of Japanese terms commonly used on invoices.
2. Invoicing Companies vs Invoicing Individuals
As a freelancer, you’re likely to find yourself doing work for both companies and individuals.
Companies
When doing work for a registered corporation in Japan, 10% tax is automatically deducted from your income. You should then be provided with a tax withholding slip for all the work you did at the end of the year. You can then use this to do your taxes.
Individuals
You may likely not get a tax withholding slip from individual clients. Keeping track of the exact amount that enters your bank account, however, should be sufficient for tax purposes. Make sure you can also state the specific service you were paid for.
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3. How to Keep Track of Your Income
Keeping organized will help make tax season far less stressful. There are a few tools that can help with this.
Spreadsheets
Spreadsheets are a simple and cheap way to keep track of your finances. Microsoft Excel is arguably the best known. If you don’t have a Microsoft Office account, Google Sheets works just as well, and is available on any kind of computer.
Useful Websites
The following websites are designed to help freelancers and sole proprietors handle the tax side of things:
Please note these websites are only available in Japanese, but they should be easy enough to translate in your web browser.
4. Other Tips
There are a few other things you can do to help you navigate invoicing as a freelancer, such as:
- Joining a community
- Keeping receipts for expenses
- Asking for help
Joining a Community
Whether you’re a designer, a translator, or any other kind of freelancer, you’re sure to find a like-minded community in Japan. Not only will you make friends or find new clients, but you’re also bound to find a lot of advice, including how to invoice for your specific kind of work.
Keeping Receipts for Expenses
Doing freelance work for clients can sometimes mean sourcing necessities out of your own pocket. Make sure to keep the receipts for each and every business expense so that you’re able to claim it back come tax season.
Asking for Help
As we’ve already mentioned, joining a community of freelancers can be very helpful. If you need more guidance and advice, you can also contact the national tax agency on their English language numbers.
If you want to know more about freelancing in Japan, check out our ultimate guide.
Advice for Freelancers
Of course, Inbound Technology is also here to help. If you’re looking for the perfect tech job in Japan, don’t hesitate to contact one of our knowledgeable career advisors here. You can also follow us on LinkedIn.