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Taxpayers
The
Corporation Tax Law classifies corporations into
"domestic corporations" and "foreign
corporations". If a foreign corporation establishes
a subsidiary or joint venture in Japan, the subsidiary
or joint venture is regarded as a "domestic
corporation". However, if a foreign corporation
establishes a branch office or representative office in
Japan, it is regarded as a "foreign
corporation".
Domestic
corporations are subject to corporation tax both on
Japanese source income and foreign source income.
However, foreign corporations are subject to corporation
tax only on the Japanese source income derived form its
branches (permanent establishments) located in Japan. If
a foreign corporation with a permanent establishment in
Japan receives domestic business income derived from
sources in Japan such as interests, dividends,
royalties, etc., income tax is withheld at the source
and there is no requirement to file a return for
corporation tax. When a foreign corporation has
established a domestic corporation or a branch office in
Japan, the foreign corporation must file a notification
of establishment with the tax office within two months
after such establishment.
A
Tax base
The
tax base for corporation tax is the amount of net income
for each fiscal year.
B
Place of tax payment
The
place of tax payment for a domestic corporation is the
location of its head office and, for a foreign
corporation, the location of its main permanent
establishment in Japan.
C
Final return
A
corporation must file a final return with the tax office
whether or not it has a positive income. This must be
done within two months from the last day of the fiscal
year and any accrued tax must to be paid to the tax
office. Extension of the due date may be approved if a
corporation submits a request form.
D
Blue form return for corporation tax
A
corporation may file a blue form return after obtaining
prior approval from the tax office. A blue form return
corporation is granted privileges in the calculation of
income and in taxation procedures. A corporation filing
a blue form return must keep necessary books and
accurate records of all transactions.
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Other
taxes on corporations
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A
corporation must file returns for the following taxes within two months from
the day following the last day of the fiscal year.
Consumption
tax
Taxpayers
of consumption tax are business enterprises that sell goods, lease assets
and provide services in Japan. Amounts of consumption tax are added on
(shifted) to the prices of goods and services. Therefore, the tax is
ultimately borne by consumers. Imported products are taxable, but exported
products are exempted from taxation. A corporation must file a final return
and pay consumption tax to the tax office. The amount of consumption tax to
be paid is the net of consumption tax received minus that paid by economic
transactions during the fiscal year.
A
Corporate enterprise tax
The
tax base for corporate enterprise tax is the net income for each fiscal
year. A corporation must file a final return with the prefectural offices
whose jurisdiction areas cover the locations of the head office and branch
offices.
Extension
of due date may be approved if a corporation submits a request form.
B
Corporate inhabitants tax
The
tax base for the corporate inhabitants tax is the amount of national
corporation tax for the fiscal year. Corporate inhabitants tax consists of
prefectural and municipal inhabitants tax. Regardless of a loss position, a
corporation must pay a per capitalevy. Places of payment are the prefectural
office and municipal office.
Extension
of due date may be approved if a corporation submits a request form.
C
Business office tax
If
a corporation is located in a specially-designatad ward in Tokyo or in a
specially-designated city, and if the floor space of a corporation's office
exceeds a certain level or the number of employees exceeds a certain number,
the corporation must file a return and pay the business office tax to the
designated ward in Tokyo or other designated cities.
A
corporation whose fiscal year exceeds six months is required to file an
interim return on corporation tax and certain other taxes. The corporation
must partially pay the taxes within two months after the first six months
from the first day of the fiscal year.
Land
value tax
A
corporation that owns land in Japan which exceeds a certain amount of value
must pay land value tax.
A
Property tax
A
corporation that owns real property or any depreciable assets for business
must pay property tax to the municipality.
Registration
and license tax
A
corporation that registers the transfer or preservation of ownership of land
or a building with the government registration office must pay registration
and license tax.
A
Stamp tax
A
corporation that signs certain certificates on the acquisition^forfeiture,
change or lapse of a property right must pay stamp tax.
B
Real property
acquisition tax
A
corporation that acquires land or a building must pay real property
acquisition tax to the prefecture.
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General Section
