Taxable Presence

Kaki, or Japanese persimmons come into season in the Autumn and are dried in the winter.
This section collates articles addressing when a non-Japanese company is treated as having a taxable presence in Japan and hence a requirement to file a Japanese tax return and pay corporate tax on its net income. The technical term used in tax law for a such a taxable presence is ‘permanent establishment’ or ‘PE’. The most common taxable presence or PE that foreign companies have in Japan is undoubtedly the branch. However, in addition to a branch the PE concept can include construction projects and agents of the foreign company acting on its behalf in Japan.

These definition of PE under Japanese tax law is therefore a threshold issue in the determination of whether or not a foreign company is liable to corporate tax in Japan and this definition and related international tax issues are addressed in this section. Please also refer to the Japan source rules section to understand the scope of Japanese source income that is subject to tax and how it varies by the type of PE.

The agent PE under Japanese domestic tax law

The agent PE under Japanese domestic tax law

10/28/2010 • Japanese domestic tax law and related Tax Instructions include detailed regulations addressing when a person in Japan acting as an...Read More

The Japanese ‘Fixed Place of Business’ PE

The Japanese ‘Fixed Place of Business’ PE

10/03/2010 • A long established convention of international tax law is that in order for the business income of a company to...Read More

PEs under Japan's tax treaties

PEs under Japan’s tax treaties

03/06/2010 • The scope of PEs under different tax...Read More