In this page: Corporate Taxes | Accounting Rules | Consumption Taxes | Individual Taxes | Double Taxation Treaties | Sources of Fiscal Information
Corporate tax (for companies with share capital exceeding JPY 100 million) | 23.2% |
Local taxes | 2.390% (corporate taxpayers are required to file and pay the national local corporate tax at a fixed rate of 10.3% of their corporate tax liabilities - 23.2% x 10.3%) |
Standard enterprise tax (including local corporate special tax) | 3.5% for the yearly tax base up to JPY 4 million 5.3% for the tax base up to JPY 8 million 7% for the tax base over JPY 8 million |
Inhabitant’s tax (imposed on a corporation’s income allocated to each prefecture and city) | determined by the local government by the factors of paid-in capital and the number of employees |
Effective tax rate (after deducting the enterprise tax, including local corporate special tax or special corporate business tax) | 30.62% (based on the maximum rates applicable in Tokyo to a company whose paid-in capital is over JPY 100 million) |
Registration and license tax is levied where certain property is registered, at a rate from 0.1% to 2% of the taxable basis or at a fixed amount. A share registration tax is assessed at 0.7% on the registration of new or additional share capital.
A business premises tax is levied in some cities, including Tokyo, Osaka, Nagoya, Fukuoka, etc. Companies with more than 100 employees in a designated city and/or with business premises in excess of 1,000 square metres are subject to the tax based on the usage of the business (JPY 600 per square metre) and gross payroll (0.25% of gross payroll).
Social security contributions paid by the employer amount to a maximum of 16.23%.
Family corporations are liable for an additional tax on their undistributed current earnings in excess of specified limits, with rates as follows: first JPY 30 million 10%; next JPY 70 million 15%; over JPY 100 million 20%.
Japan | OECD | United States | Germany | |
---|---|---|---|---|
Number of Payments of Taxes per Year | 19.0 | 10.1 | 10.6 | 9.0 |
Time Taken For Administrative Formalities (Hours) | 128.5 | 163.6 | 175.0 | 218.0 |
Total Share of Taxes (% of Profit) | 46.7 | 41.6 | 36.6 | 48.8 |
Source: The World Bank - Doing Business, Latest data available.
You can contact the Board of Audit of Japan, the Japan Corporate Auditors Association (JCAA) and the Certified Public Accountants and Auditing Oversight Board.
Taxable Income | Rate |
Less than JPY 1.95 million | 5% |
From JPY 1.95 to 3.3 million | 10% + JPY 97,500 |
From JPY 3.3 to 6.95 million | 20% + JPY 232,500 |
From JPY 6.95 to 9 million | 23% + JPY 962,500 |
From JPY 9 to 18 million | 33% + JPY 1,434,000 |
From JPY 18 to 40 million | 40% + JPY 4,404,000 |
More than JPY 40 million | 45% + JPY 13,204,000 |
Special Tax for Reconstruction Assistance will be applied from 2013 to 2037 (to help with Tohoku earthquake disaster recovery) | 2.1% of income tax |
Local Inhabitant’s Tax | 10%, levied on a taxpayer’s prior year income. The standard annual amount is JPY 5,000. |
Non-residents' Employment Income | Flat 20.42% national income tax on gross compensation (including the 2.1% surtax; no deductions available) plus 10% local inhabitant’s tax (if registered as a resident as of 1 January of the current year). |
Foreign tax credits are provided for resident taxpayers on foreign-source income, though generally limited to the lesser of foreign income tax paid or the Japanese tax payable on the income base.
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Latest Update: April 2024