Cash Repatriation Heatmap

Japan

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Key Initial Planning Considerations
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Key Initial Planning Considerations
Generally speaking, assuming a straightforward process how long does it take to pay a dividend?

Share Company ("KK"): One month or less.

Limited liability company ("GK"): One month or less.

Any timing restrictions on paying dividends?

KK: Final dividends: No.

Interim dividends: It depends on the company's articles of incorporation.

GK: No.

What accounts will be required to support payment of dividend and will these need to be audited?

KK: Financial statements audited by a company auditor (if there is one), approved by the board (if there is one), and approved by the shareholder(s) of the company.

GK: Unaudited accounts.

Are there restrictions on the amount of dividends that can be paid?

Yes, by reference to the total amount of retained earning (capital surplus and accumulated earning for KK and accumulated earning for GK).

The formula for calculations will depend on corporate form.

Are there any ways to increase reserves, and if so, how long do these generally take?

N/A. 

(Dividends cannot be made from reserves.)

Are foreign investment or other regulatory approvals required on payment of a dividend?

No.

Are there any foreign exchange requirements on paying dividends to foreign parent companies?

No.

If, however, the company intends to make a payment to a foreign entity in excess of JPY 30 million, the company is required to submit a payment report to the Bank of Japan via a remitting bank within 10 days of the payment.

Can cash be borrowed to settle a dividend?

Yes.

Are dividends in kind possible?

Yes.

Are there any other general considerations with a significant timing impact on payment of dividends?

No.

Are there any restrictions on lending funds intra-group but cross border?

No.

If, however, the company receives actual payment from a foreign entity in excess of JPY 30 million in relation to such loan, the company is required to submit a payment report to the Bank of Japan within 10 days of the loan.

Also, a further Bank of Japan report or a prior approval by the Bank of Japan may be required depending on the due date and the amount of the loan.

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