Japanese domestic tax law and related Tax Instructions include detailed regulations addressing when a person in Japan acting as an agent on behalf of a foreign company can create a taxable presence – a permanent establishment or ‘PE’ – of the foreign company in Japan. Read More
On 26 October 2010 the Nikkei Keizai Shimbun reported on proposals to introduce into Japan tax preference zones (in Japanese.’総合特区’ or ‘sougou tock’ translated below as ‘Comprehensive Special Zones’) that give preferential tax treatment to certain industries Read More
The Japanese tax law concerning Japanese civil law partnerships (in Japanese nin’i kumiai and below ‘NKs’) includes anti-avoidance provisions that can apply to deny the deduction of tax losses arising from an NK under circumstances where, generally speaking, the investment is passive and there are actual or substantive limits to the NK investor’s economic exposure to the underlying NK investments. Read More
The Tokyo District Court (in Japanese commonly referred to as ‘東京地裁’) recently issued a decision in a case involving a plaintiff that had improperly capitalized costs into inventory in a prior financial year and then claimed a tax deduction for the write off of those costs in the subsequent financial year under appeal. Read More
On Thursday 21 October 2010 the Nikkei Keizai Newspaper reported that the Japanese government was considering introducing preferential tax rates for foreign companies investing into Japan, lowering the corporation tax rate between 10 to 15 percentage points over a five year period. Read More
This article discusses the basic Japanese accounting treatment of membership of Japanese civil law partnership, in Japanese a nin’i kumiai and below an NK.
An overview of the legal aspects of an NK arrangement can be found in this article, which also includes defined terms or abbreviations used here.
A description of the tax treatment can be found in this article.
For Japanese tax purposes Japanese civil law partnerships (in Japanese nin’i kumiai, referred to below as ‘NK’s) are treated as fiscally transparent.
NKs themselves are not taxed as separate entities. Instead, the members of the NK are subject to taxation on the income treated as attributable to them. Read More
Under Japanese domestic law where an individual who is not resident in Japan comes to work in the country he would normally be treated as earning Japan source income and hence have an obligation to file a Japanese tax return and pay Japanese tax.
A typical example of this situation may be a resident of Hong Kong Read More
This article looks at the scope of Japanese taxation of non-resident individuals. This topic is also likely to be of interest to individuals who are giving up their Japanese residence status, such as non-Japanese expatriate individuals who have lived and worked in Japan for a few years who are returning to their home country or Japanese expatriates going to work overseas. Read More