Solid Japan Newsletter – July 2009

Government Introduces New Tax Measures for SMEs

To help provide stimulus in the economic downturn, an additional tax reform bill was recently passed by the Diet. The following are two key changes:

1.   Increase in amount of deductible Entertainment Expenses for Small and Medium Sized Companies

Prior to the tax reform bill, the deductible limit of entertainment expenses for companies whose paid-in capital is JPY 100 million or lower was the lesser of JPY 3.6 million or 90% of the actual entertainment amount. The new amendment raises this to JPY 5.4 million or 90% of the actual amount. This amendment will apply for fiscal years ending on or after April 1, 2009.

2.   Carryback of Losses Refund

Small and Medium-sized companies filing Blue Form returns may be eligible to claim a refund for a portion of the corporate taxes they paid last year if they will be in a loss position this year. This applies to companies with fiscal years ending after February 1, 2009. In order to receive the refund, companies must submit an application form to their tax office within the fiscal year they recognize the loss. The basic formula for calculating the refund is: last year’s corporate tax paid amount X this year’s loss /last year’s profit.

Economic Indicators on the Rise in Japan

Japanese consumer confidence was on the rise again in June, perhaps indicating that the worst fears about the recession are behind us. The household confidence index edged up to 37.6 in June from 35.7 in May. Another encouraging economic indicator is the factory output index which shows that factory output rose 5.7% in May, its third straight monthly increase.

Solid Japan Launches New Website www.solidjapan.com

We are pleased to launch our newly re-designed website. With a fresh, clean look and easy to navigate information bars, we hope you will visit our new site often. iPhone users can also add the new Solid Japan iPhone button by visiting www.solidjapan.com and pressing the “+” button at the bottom of the screen.

Solid Japan Founder Featured on itv-asia.com

Solid Japan’s Managing Director Robert Crane was recently interviewed for the Business Entrepreneur’s section on the itv-asia.com website. itv-asia is a leading resource for business information in the Asian region. The topics discussed in the segment include the process for setting up businesses in Japan, and Robert’s experiences helping foreign businesses get started. The interview hosted by Dave Mori, is expected to be posted on the itv-asia website in the coming days.