3.5 Tax Treaties

Section 3: Taxes in Japan


This section discusses the aspects of Japan’s tax system that are most relevant to a foreign corporation or individual investing in Japan. Emphasis is placed on corporate tax structures, tax treaties, and personal taxes.


3.1   Overview of Japanese Corporate Tax System for Investment in Japan

3.2   Domestic-Sourced Income

3.3   Overview of Corporate Income Taxes (Corporate Tax, Corporate Inhabitant Tax, Enterprise Tax)

3.4   Overview of Withholding Income Tax

3.5   Tax Treaties

3.6   Overview of Consumption Tax

3.7   Overview of Personal Tax System

3.8   Other Principal Taxes

3.9   Other Principal Corporate Taxation Regarding International Transactions


3.5 Tax Treaties

Japan has concluded tax treaties with many countries for the purposes of avoiding double taxation of income internationally and preventing tax evasion.

The provisions of tax treaties supersede those of domestic law. In determining the tax liability in Japan of individuals and corporations domiciled in a country with which Japan has a tax treaty, the location of the source of income deemed taxable income under Japanese law (specifically the provisions concerning where the income upon which taxation is based is generated) may at times be amended to accord with these tax treaties. Provisions have also been established in Japan for reducing the tax on, or exempting from tax, various types of income sourced in Japan.