The Asahi Newspaper today reported that the Tokyo Regional Tax Bureau (‘TRTB’) had assessed IBM Japan (a Japanese company) in respect of JPY400Bn (around USD4.5Bn) of under-reported income, being the largest ever assessment made as a result of a tax audit in Japan.
The article goes on to report as follows: Shares in IBM Japan had been sold within the IBM group by its parent company giving rise to a large loss for that parent company, IBM APH Holdings (‘APH’), which is also a Japanese company. APH and IBM Japan had formed a consolidated group from 2008 and since that time the loss APH had incurred on its sale of shares in IBM Japan offset the operating income earned by IBM Japan when the companies filed their consolidated tax return. The article suggests that IBM Japan purchased its own shares, this creating a loss at the APH level. Without stating detailed figures the article suggests that the tax liability of IBM Japan was completely eliminated. Read More
The non related business standard and the Japanese CFC regulations.Read More
Exclusions from the application of the Japanese CFC regulations.Read More
Scope of Japanese foreign subsidiaries within the Japanese CFC rules.Read More
Introduction to concepts and scope of the Japanese tax haven countermeasures (CFC) rules.Read More
How to use this glossary
This post lists up various terms used in the Japanese tax haven countermeasures taxation law (THCML). The THCML performs the same role in the Japan tax system as the CFC and Subpart F legislation in the US and UK tax systems. Read More
The scope of PEs under different tax treaties.Read More
English translations of Japan's tax treaties available on the web.Read More
Table listing how TK distributions are taxed under Japan's tax treaties.Read More
Please check this table for the Japanese rate of national tax for years from 1985 to the present day for different Japanese corporate tax paying entities.
In addition to national taxes on income, Japanese companies also have to pay local corporate taxes such as enterprise and inhabitants tax. Later posts will discuss these taxes and give examples of a typical Japanese corporation tax calculation.