Japanese Consumption Tax/Japan AC Outsourcing

Japan AC Outsourcing Co., Ltd. SAKUMA CPA OFFICE



Japan AC Outsourcing Co., Ltd. SAKUMA CPA OFFICE We specialize in providing professional Accounting &Bookeeping and Tax services in Japan.



Japanese consumption tax Consumption tax in Japan is an indirect tax, which almost every domestic transaction and every import transaction of foreign goods in Japan will be subject to taxation at the effective tax rate of 5%. Filing consumption tax and payment The final tax return must be filed and the tax must be accounted for to the tax office within 2 months after the end of the fiscal year. Consumption tax period The taxable period for a corporation is its business year. By filing an application to the tax office, an corporation can shorten the taxable period to one month or divided into three-month periods. Place for payment I.　Import transactions Foreign goods removed from a bonded area are subject to consumption tax. Taxpayers removing foreign goods from a bonded area are those who receive and remove taxable foreign goods. II.　Domestic transactions For a domestic corporation- the location of its head or main office For a foreign corporation -the location of its registered office
Purchase tax credit Where an corporation makes a taxable purchase in Japan or removes taxable foreign goods from a bounded area, the total consumption tax on the purchase is credited. Consumption tax exemption An corporation is exempt from consumption tax during its first and second business year, however, where an corporation is established with its capital of Yen 10 million, it is not exempt from consumption tax during its first and second business year. Where the amount of taxable sales of an corporation in its base period is under Yen 10 million, an corporation will be exempt from consumption tax.