Branch? OR Subsidiary?

We have often been asked
“what’s kind of entities we should set up?
Branch? Subsidiary?”
I heard most accountants recommend Japanese subsidiary
because it’s tax treatment is easier than branch. When you set up Japanese branch,
you have to follow”foreign company’s rule”which is sometimes different from domestic company’s rule.However,
branch might be better choice depending on the situation. For example,
if the head company has lots of profits and Japanese new entity should be expected negative earning for first several years,
it might be better to choose “branch.” When you make the head company’s financial statement,
you need to combine the head company’s profit with the branch’s negative earning. It can be reduce tax!
It is just one of example. Please feel free to contact us if you need further information. Thank you for reading.
KF

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