The National Tax Agency in April 2020 released amendments to prior administrative guidance and a set of “frequently asked questions” (FAQs) concerning tax relief measures provided in response to the coronavirus (COVID-19) pandemic.
The tax relief guidance addresses the treatment, for corporation tax purposes, of certain actions in transactions between business entities—such as forgiveness of trade receivables or the provision of low-interest loans—when there are financial difficulties related to the pandemic.
The FAQs address procedures for the extension of tax return filing and tax payment due dates for corporation tax, local corporation tax, and consumption tax in response to the pandemic. Specific FAQs provide examples of qualified and non-qualified tax losses for purposes of the tax loss carryback rule, and also address the tax treatment of costs paid by companies in response to the pandemic (e.g., the costs of companies providing face masks to workers). There are FAQs also providing instructions concerning the treatment of reductions of directors’ compensation in response to business downturn. Separate FAQs address procedures for individual taxpayers with regard to extensions of tax return filing and tax payment due dates regarding individual income tax, gift tax, and individual consumption tax.
Read an April 2020 report [PDF 113 KB] prepared by the KPMG member firm in Japan
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.