#045

My name is Sadayasu Ito, a Japanese certified tax accountant. I am helping those who wish to start business in Japan. Please contact me if you are looking for advice.

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E-mail: [email protected]
From Oversea: +81-3-4405-6009 From Japan: 03-4405-6009
Sadywell Japan Tax & Accounting: http://en.sadywell.com
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For instance, if you have any of the following problems, please let me know. I am happy to help you.

I want to set up a company and start business in Japan
I need to file tax returns but do not know how to do it.
I want someone to do my company’s bookkeeping.
I want to know how I can save my tax.
I want to acquire or renew my visa.

For more details of our services, please visit our website:
http://en.sadywell.com

**Summary of today’s lecture**

Today’s lecture is about “Penalty taxes”

There are several penalty related to tax in Japan.

1. Interest tax (利子税）
2. Penalty tax for late payment (延滞税）
3. Penalty tax for under-reporting (過少申告加算税)
4. Penalty tax for not filing tax return（無申告加算税）
5. Heavy penalty tax（重加算税）
6. Criminal Charge

1. Interest tax (利子税）
Filing deadline of corporate income tax is within 2 months after the fiscal year end. There is one-month extension for filing deadline. However, there is no extension for payment deadline.
If you pay tax during the extended period, you need to pay interest tax also. The interest tax is deductible items same as the interest on loan.

2. Penalty tax for late payment (延滞税）
Interest rate
2.8% for the first 2 months
9.1% after 2 months passed
Not deductible expenses
Maximum period for penalty calculation is one year.

3. Penalty tax for under-reporting (過少申告加算税)
Case 1. Tax amount is less than 500,000 yen
Additional tax payment ×15%
Case 2. Tax amount is exceeding 500,000 yen
Additional tax payment×20%
Not deductible expense

If you pay tax voluntary, you are exempted from this tax.

4. Penalty tax for not filing tax return（無申告加算税）
Case 1. Tax amount under 500,000 yen
Tax liability × 15%
Case 2. Amount exceeding 500,000 yen
Tax liability ×20%

Penalty tax rate is reduced to 5% if you file tax return and pay tax voluntary

5. Heavy penalty tax（重加算税）
Penalty for dressing and hiding
Under-reporting case: Tax liability × 35%
Not filing case: Tax liability× 40%
Malicious case: Tax liability × 45%

6. Criminal Charge


Case 1. You did not pay tax unintentionally.
Impressment: One year or less
Penalty: 500,000 yen or less

Case 2. You did not pay tax intentionally
Impressment: 5 years or less
Penalty: 5,000,000 yen or less