Hi there! I just recently started doing freelance translation as a side gig and received my first project from a localization company in the States. I’m not sure how to write up an invoice for them. Do I include the consumption tax and 10.21% withholding tax, or is that for only when billing Japanese clients? Do I just bill them the total amount and sort out taxes at the tax office later? Thanks in advance for any advice! \^-^
1 comment
If the service or product is used or delivered within Japan then yes you need to collect the Japanese VAT.
Beware though, sometimes some customers will claim that since they are not Japanese they should not pay the Japanese VAT. Nationality or place from where the order is coming has nothing to do with whether or not the product or service is eligible to local VAT or not.
If the service or product is to be delivered or used outside Japan, then the importer has to pay his local duties/taxes upon arrival. In that case you do not quote the Japanese VAT.
And same remark, some customers will blame you for their local customs asking them to pay import duties and taxes upon reception. Unless your incoterm is DDPit is the responsibility of the importer to pay those local taxes.