Japan Tax & Public Procurement Helpdesk Topic 1 Topic 2 Topic 3 Topic 4 Contact Japan’s Consumption Tax at 10 % Ms. Hiroko Koido, TGN Soleil Accounting Firm November 28, 2019 www.EUbusinessinJapan.eu 0
Japan’s Consumption Tax at 10% Impact on your business TGN So Soleil eil Accounti ounting ng Firm
Multipl ultiple e tax tax rates tes Str Structu ucture e of of CT CTax ax Ⅰ -1 10% or 10 % or 8% 8% From October 1 st 2019 manufacturing retailing importing wholesaling consumer Cost 12,000 Cost Customs Material 15,000 ★ Cost Cost 20,000 25,000 Profit 3,000 Consumption 30,000 Profit 5,000 CTax deductible CTax Profit 5,000 CTax 1,200 payable deductible Profit 5,000 1,500 1,500 CTax CTax payable deductible 2,000 2,000 CTax CTax deductible payable 2,500 2,500 CTax CTax payable deductible 3,000 3,000 ＋ ＋ ＋ ＝ ＋ 1,200 300 500 500 500 3,000 The amount of the bill for the end-user The amount of CTax payment of each business 2
Multiple Multiple Cons Consump umption tion Ⅰ -2 Ⅰ -3 Tax Ra ax Rate te 10 ％ ８％ 10 Reduced Ta Reduced Tax rat x rate Standa Stan dard T rd Tax ax rate rate Foods and Restaurant Drinks Newspapers Alcohol Foods & Drinks Others News Take out Restaurant Beer Wine Pharmaceutical/ Newspaper Water medicated product 3
Timel Timeline ine for or Ⅰ -3 qu qualif alified ied in invoice oice sy syst stem em The multiple consumption tax rate system started . 2019 2021 2023 1 Apr 1 Oct 1 Oct 1 Oct Qualified invoice method Rate-classified invoice method invoice Obligation to Indicate the total price 4
Tax ax ba base se Ⅱ - １ Taxable sales 1 （ ⅰ ） the sales or lease of an asset or the supply of services in Japan （ ⅱ ） when carried out as part of a business （ ⅲ ） with compensation 2 Imported goods into Japan Removing the imported goods from bounded warehouse . Non-residents without a fixed place of business in Japan must appoint a tax representative to handle Ctax administration 5
Tax ax ba base se Ⅱ - ２ The main non-taxable transaction : Ctax does not apply to the Following items sales or leases of land sales of securities financial transaction conducted in Japan insurance premiums services carried out by the central/local government services performed in an international context medical care social welfare activities education rental of housing exported goods and services ｇ oods purchased from tax-free shopping for non-residents 6
Filing Fili ng an and d pa payme yment nts Ⅲ - １ Filing and payments annually. Due within 2 months of the end of a corporation’s fiscal year. For individuals , due by March 31 of the year following the end of calendar year. The interim return is required depending on the amount paid as CTax for the previous year. （ The interim payments are required at the semi-annual basis , quarterly basis or monthly basis.) 7
Fili Filing ng an and d pa payme yment nts Ⅲ - ２ ～ ta taxp xpay ayer er 2017 2020 2019 2018 6/30 12/31 2/28 12/31 1/1 12/31 12/31 1/1 1/1 the the current specified the base period year period over JPY 10M taxpayer taxable sales ( € 84000 ） due date for filing and payment taxable sales over and total amount of taxpayer JPY 10M salary payment JPY 10M non-taxpayer or less 8
Filing Fili ng an and d pa payme yment nts Ⅲ - ３ ～ ta taxp xpay ayer er Newly established companies Its paid-in capital at the beginning of the fiscal year is JPY 10M or more taxpayer status Election of the taxpayer status 9
Can Can EU c EU comp ompan anies ies who ho do do business in bu siness in JAP APAN AN Ⅲ -4 ge get a t a Ctax Ctax refu efund nd? Tax payer Appointment of Business trip status tax representative in Japan EU JAPAN EU B Japanese domestic A HOTEL company business Ctax is levied. selling Tax payment taxi JAPAN EU B A buying CTax is levied. No tax refund C Tax refund Export 10
Ct Ctax ax on on cr cros oss-bo borde der r Ⅳ - su supp ppli lies es of of s ser ervice vices １ National border Japan abroad Foreign Domestic business business Electronic commerce , such as supplies of digital books ,music , and Electronic commerce , such as supplies advertisements , as well as cloud of digital books ,music , and services advertisements , as well as cloud services Co CTax is levied. Domestic consumers/business 【 identification of the jurisdiction of taxation 】 （ Before revision ） by the location of service suppliers → CTax was not levied. （ At present ） by the location of service recipients → Ctax is levied. 11
Useful Useful inf infor orma mati tion on Cas Cashles hless s pa payme yment nt Ⅴ - １ ～ na national tional pr prog ogram to pr am to promote omote it it ～ Credit card/ QR/ E-money Debit card Barcode Plastic card Smartphone Smartphone Plastic card Paypay Suica LINE pay VISA Pasmo Origami pay MASTER Edy Rakuten pay JCB WAON D pay (docomo) American Express nanaco Diners Club au pay QUICPay etc … etc … iD etc … 12
Usef Useful ul inf infor orma mation tion Cash Cashless less pa payme yment nt Ⅴ - ２ po point int retu eturn n ca campa mpaign ign Point 2% Point 5% 24 24 caf cafe Japanese Government Lower fee Retail Chain Mid / Small Retail Less than 3.25% depart rtme ment Payment Service Company 0% 0% Consumer Large Scale Retail 13
Japan Tax & Public Procurement Helpdesk Topic 1 Topic 2 Topic 3 Topic 4 Contact Question and Answer session www.EUbusinessinJapan.eu 1 4
Latest Trends in Japan's Nanotech Sector Japan Tax & Public Procurement Helpdesk Topic 1 Topic 2 Topic 3 Topic 4 Contact Thank you for your attention! jtpphelpdesk@eu-japan.eu http://www.eu-japan.eu/taxes-accounting The opinions expressed in this Webinar are those of the expert(s) only, and may not necessarily represent the views of the EU- Japan Centre for Industrial Cooperation or of the EU or Japanese Authorities. No warranty is given for their accuracy or completeness. www.EUbusinessinJapan.eu 1 5
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