Retained Earning Carried Forward

Retained Earnings Carried Forward

If you have invested in Japan and are thinking about dividends, you will need to monitor Retained Earnings Carried Forward for your Japan investment. Under the Japan Company Act, a company is required to reserve 10% of gross amount of dividends. In order words, a company can provide dividends up to 10/11 of the Retained Earnings. Please note that in principle, a company has obligations to withhold 20% of the gross dividends and make payments to the tax office the following month on the 10th day. Tax treaty on withholding on dividends differs from country to country so consult with your tax accountant on scenario planning for dividend arrangements.

“From the early days of our company’s establishment, N & M have given us a fine service not just for monthly and annual accounting, payroll processing and tax filing, but for financial reporting to our head office. In addition, we greatly appreciate their detailed responses to the head office for any small query about reporting.

While the reporting schedule of overseas head office is sometimes very tight because it is out of consideration of Japanese holidays and other local schedule. Despite such a hard schedule, N & M have provided the service in time and it is a great reassurance to us.

As we can get a in-depth reply from their experienced staff even for a minor question, we can consult N & M about anything without hesitation. We have nothing to worry about daily accounting in general. N & M is a necessary partner for us to facilitate our business in Japan.”

Mr. Hiroshi Ohtaka, Representative Director
Bel Japon K.K.