Nagamine & Mishima Accounting Office

Accounting practice since 1989

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Prepaid Expence

Prepaid Expence

Expenses such as below are in principle recognized based on the service period.

1. Insurance
2. Rent
3. Interest

But exceptions apply to those expenses meeting certain condition which allows expense recognition on cash basis. In other words, even if the payment is upfront, a company can claim the full payment amount as expense in the fiscal year which it was settled. Consult with your tax accountant since consistency is also a key in qualifying for this benefit.

Please note that consumption tax is recognized at the point service is provided not when payment is settled.

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People are Talking

  • “Nagamine was instrumental in setting up our first Japanese entity in 2008, allowing us to hit the ground running when we arrived.

    Since then they have been crucial in the smooth running of our business. We use them to organize our bookkeeping, payroll and social insurance, tax reports and returns.

    Their bilingual staff are a pleasure to deal with and are always going above and beyond their usual tasks when we need extra help. We find them extremely reliable and we look forward to working with them into the future.”

    Meltwater News Japan, Meltwater group

    Meltwater News Japan