RetireJapan

Hi everyone

I'm starting to do paid consulting and was wondering about taxes.

As a sole proprietor, do I charge 8% consumption tax on services?
If I do work for someone, do they withhold 10% income tax?

You don't need to pay consumption tax as long as total revenue from the business you're running as a sole proprietor is less than Y10 million per year.

If you do work for a corporation, they will likely be required to withhold 10% (or 20% if the bill is for over Y1 million) if you're a 個人事業.
I think the 10% withholding is not an issue if you're set up as a corporation, but it's been a while since I've had to deal with that; you will want to look into that in more detail.

Thanks!

The answers I found is that a) yes you charge, but you can keep it if you make under 10m , and b) the 10% is withheld as I am not incorporated. The two somewhat balance out (and can claim the 10% back at tax time).