Attention sellers!
When you are still in the crazy involution of European and American markets
The Japanese station next door...
Quietly started a new move
Japan consumption tax Amazon Japan announced that starting from October 1, 2023, the reform of the Japanese Consumption Tax ("JCT") "Compliance Invoice Retention System" initiated by the Japanese National Tax Agency will take effect. In other words, cross-border sellers who meet the conditions need to register an Amazon Japanese consumption tax registration number (JCT tax number)!
In fact, as early as February this year, when I learned that Japan would implement the invoice system, I gave you a popular science on "Japanese VAT" in advance. The details can be reviewed"The Japanese version of "VAT" will be launched next year. What impact will it have on sellers?", this time the growing girl will give you a detailed explanation of this system.
1What is JCT?
Japanese consumption tax (JCT) is a tax paid by consumers when purchasing goods. It does not need to be levied because of the loss or profit of the goods. It is also called a turnover tax.Can be understood as the Japanese version of VAT. For purchases by corporate buyers, the buyer can deduct the JCT input amount of the JCT invoice from the tax payable to the tax bureau through the JCT invoice provided by the seller.
2. What is the compliance invoice retention system?
The compliant invoice retention system refers to the “new purchase tax credit method” that supports consumption tax at multiple tax rates. According to the new policy of the Japanese National Tax Agency, the invoice system will be launched on October 1, 2023 (Reiwa 5th year). Under this system, the conditions for operators to obtain "consumption tax credits" are: (1) Invoices. (Invoices, invoices containing specific items, etc.) (2) Account books, two copies need to be kept.
Image source Japan National Tax Agency What impact will this have on sellers and buyers? For sellers, only a "qualified invoicer" can issue invoices. To become this "qualified invoicer", you must apply to the tax bureau and register for JCT, and since it can only be registered by taxable enterprises, it is tax-free The enterprise cannot become a qualified invoicing enterprise (that is, it cannot issue invoices). For buyers, they need to provide a compliant invoice with the seller's JCT registration number to use JCT input deduction.
3. Which sellers need to register a JCT tax number?
If any of the following conditions are met, you will be obliged to register for JCT and pay taxes as required: 1. The seller's taxable sales exceed 10 million yen during the base period. 2. The seller's taxable sales during the base period do not exceed 10 million yen, but the taxable sales in the first half of the previous base year exceed 10 million yen. 3. If the company's registered capital is more than 10 million yen (including 10 million yen), it needs to register JCT regardless of the sales volume.
Note: The base period refers to the two base years before the tax deadline. The starting month of the base year depends on your company type: − Sole proprietorship: Your base year is from January to December. − Company: The starting month of your base year depends on your company. For Japanese companies, your base year is usually April to March. For Chinese companies, your base year is usually January to December.
4. How do sellers register and declare?
Growing Little Girl learned that since October 2021, the Japanese National Tax Agency has begun to accept applications for JCT registration numbers, which are divided into two methods: 1. Register and declare by yourself. Qualified sellers can prepare the following information and enter the Japanese National Tax Agency Register the JCT tax number on the official website: ① Scanned copy of the company's business license (three certificates in one); ② Scanned copy of the company's legal person's passport; ③ POA signed by the legal person; ④ Application form; ⑤ Company's annual sales data; ⑥ Required during the declaration process Other relevant information, etc. 2. Sellers who register through a service provider can also consult a third-party tax service provider in the Amazon Service Provider Network (SPN) in the Amazon backend to apply for a JCT registration number. Registration time limit: about 2-3 months, need to prepare in advance. Reporting cycle: annual report. Declaration deadline: Within 2 months from the day after the end of the taxable period. Growth Girl suggests that if you want to obtain a Japanese consumption tax registration number before October 1, 2023, you should usually submit an application before March 31, 2023. The earlier the layout, the better.
Five Japanese consumption tax rates
Japanese consumption tax includes national tax and local tax. Generally, it is standard 10% and low tax rate 8%. However, the low tax rate only applies to food, drinks, newspapers and other products. The standard tax rate is 10% The consumption tax rate is 7.8%, and the local consumption tax rate is 2.2%. The reduced tax rate is 8% The consumption tax rate is 6.24%, and the local consumption tax rate is 1.76%.
6. What will be the consequences of not registering?
The JCT registration number of the Japanese station is about to take effect. Judging from the registration conditions, this policy is not mandatory. The most direct impact on sellers is: Without a JCT registration number, sellers will not be able to issue compliant invoices to buyers, and buyers will no longer purchase your products if they are unable to apply for tax deductions. The most direct impact is This leads to a decline in sales. Growth Girl recommends that sellers who want to show off their talents in the Japanese market and have long-term plans should register a JCT registration number before October 1, 2023. Qualified cross-border sellers must pay attention! From the above policies, we can see that cross-border compliance has been fully implemented. If sellers want to operate well on the Amazon platform, compliant operations are the safest method. Regarding the newly implemented Japanese consumption tax, if you have any questions or need to handle business, you can consult the growing girl.
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