(2205/8/28)

What to Consider When Thinking of Changing Your Tax Accountant

When you establish a corporation in Japan, you will almost certainly receive support from a tax accountant. This is because a corporate tax return is always necessary, no matter the circumstances. Besides this, there are many things a corporation must do regarding taxes, and it is extremely difficult to understand everything and do it yourself without a tax accountant’s support. However, you may also become dissatisfied with your tax accountant. This is because there are many tax accountants in Japan, and the services they offer are diverse and may not always align with your wishes. In such cases, you might consider changing tax accountants, and in this article, I would like to tell you what to consider at that time.

Tax Accountant’s Fee is High
Since there are many tax accountants in Japan, their fees vary. From your perspective, you would be happy if the fee is low. A tax accountant who offers a higher quality service at a lower fee than your current one might exist. However, you are not guaranteed to find such a tax accountant, and it may depend on what you consider a reasonable fee. Regarding this, I will tell you my thoughts on how tax accountants’ fees are determined. Tax accountants mainly sell their expertise and time (furthermore, taking on responsibility is also part of their job). For tasks that require high expertise and a lot of time, the fee will be the highest. On the other hand, the fee for tasks that require low expertise and little time will be low. In other words, one way to lower your tax accountant’s fee is for you to do some of the tasks that require low expertise and a lot of time (tasks said to require low expertise are not always so and may require high expertise depending on the situation). Bookkeeping is usually the most time-consuming task performed normally by a tax accountant. Although some companies do their own bookkeeping, if yours does not, consider doing the bookkeeping yourself (at least partially). In that case, many tax accountants will agree to lower their fee.

The Tax Accountant Does Not Propose Tax Savings
Some people think that if they ask for a tax accountant’s support, their taxes will be lower. It is true that a tax accountant may lower your taxes. However, that is not always the case. A tax accountant’s job is to correctly calculate your taxes. As a result of a correct calculation, your taxes may be lower or higher. Therefore, it is not correct to think that a tax accountant is bad just because they don’t propose tax savings. There are several ways to save on taxes; some are methods that should be performed as a matter of course, and others are performed depending on the situation. The representative examples of the former are the Blue tax return and consumption tax. The Blue tax return is a filing method that is almost certain to be performed when a tax accountant is involved. Consumption tax is an optional system with several calculation methods (including whether to file), so you need to make the best choice. These two are the most basic forms of tax savings, so if your tax accountant is not making good judgments about them, you should consider changing tax accountants. The tax savings performed depending on the situation are those that involve an expenditure. For example, the Small Business Mutual Aid (小規模企業共済). This is something that lowers your taxes with an expenditure, so it may not be a good tax-saving method if you don’t have enough funds (personally, I think the Small Business Mutual Aid is recommendable even in such cases, but other tax-saving methods that involve expenditures may not be a good choice). Therefore, it is not appropriate to judge a tax accountant as bad based on the reason that they don’t propose tax savings. Tax savings are not magic, so there are not many tax-saving methods without drawbacks.

The Tax Accountant Does Not Provide the Tax Services You Need
There are many types of taxes. There are corporate tax, personal income tax, consumption tax, inheritance tax, international taxation, organizational restructuring tax, and so on. Just as you wouldn’t choose to go to an ophthalmologist when you have a cold, you need to choose the appropriate tax accountant depending on the tax services you need. If your current tax accountant does not provide the services you need, you should consider changing tax accountants. Note that you may use the services of multiple tax accountants depending on the type of tax.

There is a Language Barrier
If your tax accountant provides services only in Japanese, you will not be able to communicate well and will face difficulties. It is not common to find tax accountants in Japan who provide services in English. However, the number of tax accountants who can complete all services online using cloud storage and video conferencing is increasing, so I don’t think it’s very difficult to find a tax accountant that suits you in recent years.

Summary
If you are dissatisfied with your relationship with your tax accountant, first clarify the cause. This article introduced four perspectives: “fee,” “tax savings,” “specialization,” and “language.” By considering these, I think it would be good to judge whether your dissatisfaction is a legitimate reason to change your tax accountant. Regarding fees, there is a possibility of lowering the cost by doing some of the work yourself, such as bookkeeping. Regarding tax savings, a tax accountant’s role is to correctly calculate your taxes, and it is not always true that a tax accountant is bad just because they don’t make tax-saving proposals. First, you should consult with your tax accountant. Also, if your current tax accountant does not provide the specialized services you need or if there is a language barrier, you should consider changing.
Changing tax accountants is a decision that will have a significant impact on your business. Please use the points introduced in this article as a reference to make your decision.