Japan tax qualified invoices October 2023

Japan plans to introduce for the first time Consumption Tax invoices for input tax credits from 1 October 2023. Termed qualified invoices, these will be only issued by certified invoice issuers. A Transitional Invoice Retention System is already effective from October 1, 2019 until September 30, 2023.

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Currently, there is no legislated tax invoice; taxpayers are instead required to maintain prescribed tax books partially because until October 2019 there was only a single Consumption Tax rate. An 8% reduced rate was introduced alongside the 10% standard rate. The invoicing system will ensure that the creditable tax amount can be calculated properly, given the multiple tax rates.

Transitional Invoice Retention System until September 2023

The Transitional Invoice Retention System applies during the four-year period beginning October 1, 2019 and continues until the Qualified Invoicing System comes into effect on October 1, 2023. 

Under the Transitional Invoice Retention System, invoices must specify the sales amount and the applicable tax rate. Correspondingly, taxable purchases must be recorded in the taxpayer’s books at the applicable tax rate in order to claim an input tax credit. 

Tax qualified invoice from October 2023

To obtain certification, businesses will be able to apply their national tax office from 1 October 2021.  The last date for application is 31 March 2023 to ensure the process is completed in time for 1 October 2023.

Disclosure requirements on qualified invoices

The following information is required on any qualified invoices:

• Date
• Issuer qualified invoice identification number (granted on successful application)
• Customer identification
• Description of taxable service
• Price (split by Consumption Tax if applicable)
• Consumption Tax charge