Is it true that "it pays for a small or medium-sized company to keep its profit at ¥8 million or less"?

“I heard that a small or medium-sized company is better off keeping its profit at ¥8 million a year or less.” Before the closing of the books, you may have heard something like this. Company profit does have a dividing line of “¥8 million” in tax law. Around that line, a saying has spread that “if you go over ¥8 million, you lose.”

We checked both national taxes (corporation tax, local corporation tax, special corporate enterprise tax and special defense corporation tax) and local taxes (corporate enterprise tax and corporate inhabitant tax) against the laws and the published materials of the National Tax Agency (NTA) and the Tokyo Metropolitan Bureau of Taxation.

Five tax terms, explained first

Here are plain-language explanations of the terms used in this article.

• Income (shotoku) = what tax law calls “earnings.” It is the accounting profit adjusted under tax-law rules. In this article it means almost the same as “profit.”
• Small or medium-sized corporation (chūshō hōjin) = a name for smaller companies, such as ordinary corporations with capital of ¥100 million or less. Tax law divides companies by the amount of capital.
• Base rate, reduced rate, special rate (honsoku, keigen zeiritsu, tokurei) = the “base rate” is the statutory rate when no special measure is used (23.2%). The “reduced rate” is 19%, lower than the base rate. The “special rate” is 15%, a temporary reduction under the Act on Special Measures Concerning Taxation.
• Standard tax rate and excess tax rate (hyōjun zeiritsu, chōka zeiritsu) = the “standard tax rate” is the benchmark rate for local taxes. A local government may impose a rate above the standard rate by ordinance (an “excess tax rate”), and the law sets a ceiling.
• Income-based portion, corporation-tax-based portion, per-capita portion (shotoku-wari, hōjinzei-wari, kintō-wari) = names for the parts of tax that depend on earnings. In corporate enterprise tax it is the “income-based portion,” in corporate inhabitant tax it is the “corporation-tax-based portion,” and the part charged as a fixed amount regardless of earnings is the “per-capita portion” of corporate inhabitant tax.

Conclusion: “Half true”

Our verdict is “HALF TRUE.” It is true that there is a dividing line at ¥8 million, and before and after it the share of tax on each additional yen earned changes. But the conclusions “it pays to stay at ¥8 million or less” and “if you go over ¥8 million, you lose” are wrong. The higher rate applies only to the portion above the line, so if profit grows, your take-home amount grows too.

National taxes: corporation tax is divided at ¥8 million

The rate of corporation tax depends on the amount of income. First, the base rate in the law. The income of an ordinary corporation is taxed at 23.2% (Article 66, paragraph 1 of the Corporation Tax Act), and only the portion of a small or medium-sized corporation’s income up to ¥8 million a year gets the 19% reduced rate［1］［4］.

前項の場合において、普通法人（通算法人を除く。）若しくは一般社団法人等のうち、各事業年度終了の時において資本金の額若しくは出資金の額が一億円以下であるもの若しくは資本若しくは出資を有しないもの又は人格のない社団等の各事業年度の所得の金額のうち年八百万円以下の金額については、同項の規定にかかわらず、百分の十九の税率による。［4］

Reference translation (unofficial): In the case of the preceding paragraph, for the portion of the amount of income for each business year that is ¥8 million or less per year, of an ordinary corporation (excluding a group-taxation corporation (tsūsan hōjin)) or a general incorporated association, etc. whose amount of capital or investment at the end of each business year is ¥100 million or less, or that has no capital or investment, or of an association without legal personality, etc., the tax rate is 19%, notwithstanding the provisions of that paragraph.

In plain terms: for a small or medium-sized corporation (excluding a group-taxation corporation), the portion of income up to ¥8 million a year is taxed at 19%. The portion above ¥8 million stays at the base rate of 23.2%.［4］

On top of that, a special measure in the Act on Special Measures Concerning Taxation lowers the rate on this portion up to ¥8 million to 15%［3］.

の平成二十四年四月一日から令和九年三月三十一日までの間に開始する各事業年度の所得に係る同法その他法人税に関する法令の規定の適用については、同欄に掲げる法人又は人格のない社団等の区分に応じ同表の第二欄に掲げる規定中同表の第三欄に掲げる税率は、同表の第四欄に掲げる税率とする。［3］

Reference translation (unofficial): (…) In applying that Act and other laws and regulations on corporation tax to income for business years beginning during the period from April 1, 2012 (Heisei 24) to March 31, 2027 (Reiwa 9), the tax rate listed in column 3 of the table, within the provision listed in column 2 of the same table according to the category of corporation or association without legal personality listed in the same column, is the tax rate listed in column 4 of the table.

In plain terms: for business years beginning by March 31, 2027 (Reiwa 9), the 19% in the table becomes 15%. The special measure covers business years that begin on or before March 31, 2027 (Reiwa 9).［3］

In the NTA’s table as well, there are two divisions: “the portion up to ¥8 million a year” and “the portion above ¥8 million a year”［1］.

If the business year is shorter than one year, the line is prorated by month

For a business year shorter than one year, such as one in which the closing date was changed, the ¥8 million line is prorated by month［4］.

事業年度が一年に満たない法人に対する第二項の規定の適用については、同項中「年八百万円」とあるのは、「八百万円を十二で除し、これに当該事業年度の月数を乗じて計算した金額」とする。［4］

Reference translation (unofficial): In applying the provisions of paragraph 2 to a corporation whose business year is shorter than one year, “¥8 million per year” in that paragraph is read as “the amount calculated by dividing ¥8 million by twelve and multiplying the result by the number of months in the business year.”

In plain terms: for a business year shorter than one year, the ¥8 million is calculated according to the number of months.［4］

Local corporation tax is not divided at ¥8 million

Besides corporation tax, national taxes include local corporation tax. Local corporation tax is calculated from the amount of corporation tax［8］.

基準法人税額に対する地方法人税の額は、各課税事業年度の課税標準法人税額に百分の十・三の税率を乗じて計算した金額とする。［8］

Reference translation (unofficial): The amount of local corporation tax on the base corporation tax amount is the amount calculated by multiplying the taxable standard corporation tax amount for each taxable business year by a tax rate of 10.3%.

In plain terms: local corporation tax is the amount of corporation tax multiplied by 10.3%.［8］

Local corporation tax has no ¥8 million dividing line. Because the amount of corporation tax is its base, as a share of income the portion up to ¥8 million is 15% × 10.3% = about 1.545%, and the portion above ¥8 million is 23.2% × 10.3% = about 2.39%. The ¥8 million line exists only in corporation tax itself.

Special defense corporation tax is not charged at ¥8 million or less

National taxes include one more new tax: special defense corporation tax. It is charged according to the amount of corporation tax, from business years beginning on or after April 1, 2026 (Reiwa 8)［10］.

法人の各課税事業年度の基準法人税額には、この法律により、当分の間、防衛特別法人税を課する。［10］

Reference translation (unofficial): Special defense corporation tax is imposed, under this Act, for the time being, on the base corporation tax amount for each taxable business year of a corporation.

防衛特別法人税の額は、各課税事業年度の課税標準法人税額に百分の四の税率を乗じて計算した金額とする。［10］

Reference translation (unofficial): The amount of special defense corporation tax is the amount calculated by multiplying the taxable standard corporation tax amount for each taxable business year by a tax rate of 4%.

In plain terms: special defense corporation tax is a national tax calculated from the amount of corporation tax. The tax is 4% of the taxable standard corporation tax amount (the amount of corporation tax minus the basic deduction amount).［10］

For a corporation other than a group-taxation corporation, the basic deduction amount is ¥5 million a year［10］. For a company with income of ¥8 million, the corporation tax is ¥1.2 million, which is below the basic deduction amount, so no special defense corporation tax is charged. Corporation tax exceeds ¥5 million only when income exceeds roughly ¥24 million.

通算法人以外の法人の課税事業年度　年五百万円［10］

Reference translation (unofficial): Taxable business year of a corporation other than a group-taxation corporation: ¥5 million per year

Local taxes: enterprise tax is divided at ¥4 million and ¥8 million

The local tax that depends on earnings (income) is corporate enterprise tax (income-based portion). Of corporate inhabitant tax, the corporation-tax-based portion is calculated from the amount of corporation tax, and the per-capita portion is a fixed amount regardless of earnings. Special corporate enterprise tax is a national tax, but it is paid to the prefecture together with corporate enterprise tax, so it is explained here as well.

The standard rate of corporate enterprise tax (income-based portion) has three steps

The standard rate of corporate enterprise tax (income-based portion) is divided into three according to the amount of income: ¥4 million or less, over ¥4 million up to ¥8 million, and over ¥8 million［6］.

各事業年度の所得のうち年四百万円を超え年八百万円以下の金額 百分の五・三 各事業年度の所得のうち年八百万円を超える金額 百分の七［6］

Reference translation (unofficial): Of the income for each business year, the amount exceeding ¥4 million per year and up to ¥8 million per year: 5.3%. Of the income for each business year, the amount exceeding ¥8 million per year: 7%.

In plain terms: of income, the portion over ¥4 million up to ¥8 million a year is taxed at 5.3%, and the portion above ¥8 million a year at 7.0%. The portion up to ¥4 million a year is taxed at 3.5%.［6］

Corporation tax has one dividing line, at ¥8 million, whereas enterprise tax has two, at ¥4 million and ¥8 million. This is where the meaning of “¥8 million” differs slightly between national and local taxes.

With offices in three or more prefectures, income is not divided

Enterprise tax also has a treatment in which income is not divided. A corporation that has offices or business establishments in three or more prefectures and whose capital is ¥10 million or more pays a flat 7.0%, with no division of income［6］.

三以上の道府県において事務所又は事業所を設けて事業を行う法人で資本金の額又は出資金の額が千万円以上のもの（第七十二条の二第一項第一号イに掲げる法人を除く。）が行う事業に対する事業税の額は、第一項の規定にかかわらず、次の各号に掲げる法人の区分に応じ、当該各号に定める金額とする。［6］

Reference translation (unofficial): The amount of enterprise tax on the business conducted by a corporation that conducts business with offices or business establishments in three or more prefectures and whose amount of capital or investment is ¥10 million or more (excluding the corporations listed in Article 72-2, paragraph 1, item 1(a)) is, notwithstanding the provisions of paragraph 1, the amount specified in each of the following items according to the category of corporation listed in that item.

In plain terms: the enterprise tax of a corporation with capital of ¥10 million or more that has offices in three or more prefectures is a flat 7.0%, with no division of income.［6］

A local government may impose more than the standard rate

So far we have discussed standard rates. Local taxes are taxes of each local government, so a local government may set by ordinance a rate above the standard rate (an excess tax rate). However, the ceiling is set by law［6］.

道府県は、第一項から第五項までに規定する標準税率を超える税率で事業税を課する場合には、次の各号に掲げる率に、当該率の区分に応じて当該各号に定める率を乗じて得た率を超える税率で課することができない。［6］

Reference translation (unofficial): Where a prefecture imposes enterprise tax at a tax rate exceeding the standard tax rate prescribed in paragraphs 1 to 5, it may not impose a rate exceeding the rate obtained by multiplying each rate listed in the following items by the rate specified in each item according to the category of that rate.

In plain terms: an excess tax rate of enterprise tax may not exceed 1.2 times the standard rate. The income-based portion for small or medium-sized corporations falls in this category.［6］

For example, Tokyo sets the rates of corporate enterprise tax (income-based portion) at 3.75%, 5.665% and 7.48%［9］. These are the excess tax rates that apply to corporations that are not covered by the metropolis’s non-uniform taxation. For corporations with capital of ¥100 million or less and income of ¥25 million a year or less, among others, the metropolis applies non-uniform taxation under which the standard rates (3.5%, 5.3% and 7.0%) apply. For the corporation-tax-based portion of the corporate metropolitan inhabitant tax as well, a corporation with capital of ¥100 million or less and corporation tax of ¥10 million a year or less pays the standard rate［9］. The companies with income of ¥8 million and ¥9 million used as examples in this article would pay the standard rates even within Tokyo. To find the amount your own company pays, check the ordinances of the prefecture and municipality where your offices are located.

If the business year is shorter than one year, the lines are prorated by month

For a business year shorter than one year, such as one in which the closing date was changed, the ¥4 million and ¥8 million lines are prorated by month［6］.

事業年度が一年に満たない場合における第一項の規定の適用については、同項中「年四百万円」とあるのは「四百万円に当該事業年度の月数を乗じて得た額を十二で除して計算した金額」と、「年八百万円」とあるのは「八百万円に当該事業年度の月数を乗じて得た額を十二で除して計算した金額」とする。［6］

Reference translation (unofficial): In applying the provisions of paragraph 1 to a case where the business year is shorter than one year, “¥4 million per year” in that paragraph is read as “the amount calculated by multiplying ¥4 million by the number of months in the business year and dividing by twelve,” and “¥8 million per year” is read as “the amount calculated by multiplying ¥8 million by the number of months in the business year and dividing by twelve.”

Special corporate enterprise tax is calculated from the amount of the income-based portion

Special corporate enterprise tax is a national tax. It is filed and paid to the prefecture together with corporate enterprise tax, and its revenue is transferred to the prefectures［7］.

この法律は、地方税の税源の偏在性の是正に資するための特別法人事業税について、納税義務者、課税標準、税率、申告及び納付等の手続並びにその納税義務の適正な履行を確保するため必要な事項を定めるとともに、その収入額に相当する額を特別法人事業譲与税として都道府県に対して譲与するために必要な事項を定めるものとする。［7］

Reference translation (unofficial): This Act provides, for the special corporate enterprise tax that contributes to correcting the uneven distribution of local tax revenue sources, the matters necessary to ensure the taxpayer, the tax base, the tax rate, the procedures for filing and payment, and the proper performance of the tax liability, and also provides the matters necessary to transfer an amount equivalent to its revenue to the prefectures as the special corporate enterprise transfer tax.

In plain terms: special corporate enterprise tax is a national tax that is transferred to the prefectures. A company pays it to the prefecture together with corporate enterprise tax.［7］

For an ordinary corporation that is charged enterprise tax on the income-based portion alone (most small or medium-sized corporations fall here), the rate is 37% of the amount of the income-based portion［7］.

基準法人所得割額に百分の三十七の税率を乗じて得た金額［7］

Reference translation (unofficial): The amount obtained by multiplying the base corporate income-based amount by a tax rate of 37%.

In plain terms: the special corporate enterprise tax of an ordinary corporation calculated from the income-based portion is 37% of the base corporate income-based amount (the amount of the income-based portion).［7］

This “base corporate income-based amount” is the income-based portion calculated at the standard rate. Even if a local government sets an excess tax rate, the income-based portion that serves as the base of special corporate enterprise tax is calculated at the standard rate［7］.

地方税法の規定（同法第六条、第七条、第七十二条の二十四の十、第七十二条の二十四の十一、第七十二条の四十九の四及び附則第九条の二の二の規定を除き、税率については、同法第一条第一項第五号に規定する標準税率によるものとする。次号において同じ。）により計算した所得割額をいう。［7］

Reference translation (unofficial): The income-based amount calculated under the provisions of the Local Tax Act (excluding the provisions of Articles 6, 7, 72-24-10, 72-24-11 and 72-49-4 and Supplementary Provision Article 9-2-2 of that Act; the tax rate is the standard tax rate prescribed in Article 1, paragraph 1, item 5 of that Act. The same applies in the next item).

In plain terms: the income-based portion that serves as the base of special corporate enterprise tax is calculated at the standard rates of the Local Tax Act.［7］

Corporate inhabitant tax is divided into a corporation-tax-based portion and a per-capita portion

Corporate inhabitant tax has a “corporation-tax-based portion,” calculated from the amount of corporation tax, and a “per-capita portion,” charged as a fixed amount regardless of earnings. The standard rate of the corporation-tax-based portion is 1.0% for the prefecture and 6.0% for the municipality, together 7.0% of the amount of corporation tax［6］.

法人税割の標準税率は、百分の一とする。［6］

Reference translation (unofficial): The standard tax rate of the corporation-tax-based portion is 1%.

ただし、標準税率を超える税率で課する場合においても、百分の二を超えることができない。［6］

Reference translation (unofficial): However, even where tax is imposed at a rate exceeding the standard tax rate, it may not exceed 2%.

法人税割の標準税率は、百分の六とする。［6］

Reference translation (unofficial): The standard tax rate of the corporation-tax-based portion is 6%.

ただし、標準税率を超えて課する場合においても、百分の八・四を超えることができない。［6］

Reference translation (unofficial): However, even where tax is imposed at a rate exceeding the standard tax rate, it may not exceed 8.4%.

In plain terms: the prefectural corporation-tax-based portion has a standard rate of 1.0% (ceiling 2.0%), and the municipal corporation-tax-based portion has a standard rate of 6.0% (ceiling 8.4%).［6］

Because the corporation-tax-based portion is based on the amount of corporation tax, it has no ¥8 million dividing line, just like corporation tax. When corporation tax grows, the corporation-tax-based portion grows with it.

The per-capita portion is a fixed amount determined by the amount of capital, etc. and the number of employees. It does not change with the amount of income. For a company whose capital, etc. is ¥10 million or less and which has 50 or fewer employees, prefectural inhabitant tax is ¥20,000 a year and municipal inhabitant tax is ¥50,000 a year, together ¥70,000 a year［6］.

法人の均等割の標準税率は、次の表の上欄に掲げる法人の区分に応じ、それぞれ同表の下欄に定める額とする。［6］

Reference translation (unofficial): The standard tax rate of the per-capita portion for corporations is the amount specified in the lower column of the following table according to the category of corporation listed in the upper column of the same table.

資本金等の額を有する法人（法人税法別表第二に規定する独立行政法人で収益事業を行わないもの及びニに掲げる法人を除く。以下この表において同じ。）で資本金等の額が千万円以下であるもの　年額二万円［6］

Reference translation (unofficial): A corporation having an amount of capital, etc. (excluding an independent administrative agency prescribed in Appendix 2 of the Corporation Tax Act that does not conduct profit-making business, and the corporations listed in (d); the same applies below in this table) whose amount of capital, etc. is ¥10 million or less: ¥20,000 per year.

資本金等の額が千万円以下であるもののうち、市町村内に有する事務所、事業所又は寮等の従業者（政令で定める役員を含む。）の数の合計数（次号から第九号まで及び第五項において「従業者数の合計数」という。）が五十人以下のもの　年額五万円［6］

Reference translation (unofficial): Of those whose amount of capital, etc. is ¥10 million or less, those whose total number of employees (including officers specified by Cabinet Order) at offices, business establishments, dormitories, etc. in the municipality (referred to in the next item through item 9 and in paragraph 5 as the “total number of employees”) is 50 or fewer: ¥50,000 per year.

In plain terms: the per-capita portion is a fixed amount according to the category of corporation. It does not change with the amount of earnings.［6］

Does going over ¥8 million really make you worse off?

Lining up the rates so far shows what happens when you go over ¥8 million. The rate rises only on the portion above ¥8 million. The rate on the portion up to ¥8 million does not change even if profit grows.

This table is an estimate calculated on the following assumptions. An ordinary corporation with capital of ¥100 million or less that is not subject to size-based taxation (gaikei hyōjun kazei); it is neither an excluded business operator nor a group-taxation corporation; income is ¥1 billion a year or less; the rates are standard rates; enterprise tax is deducted as an expense of the current period; business years beginning on or after April 1, 2025 (Reiwa 7). The per-capita portion (¥70,000 a year) is not included.

The simple total is a share of income. Enterprise tax and special corporate enterprise tax are deductible as expenses, so the actual burden is slightly lower. In a rough estimate of the effective tax rate that takes the deductibility of enterprise tax into account, the portion up to ¥4 million a year is about 21.4%, the portion over ¥4 million up to ¥8 million a year is about 23.2%, and the portion above ¥8 million a year is about 33.6%.

Let us compare a company with income of ¥8 million and one with income of ¥9 million.

Even when income becomes ¥9 million, the tax on the portion up to ¥8 million stays at about ¥1.89 million. What increases is only about ¥370,000 on the extra ¥1 million. The take-home amount rises by about ¥630,000, from about ¥6.11 million to about ¥6.74 million. It is not true that “if you go over ¥8 million, you lose.”

The “¥8 million” line is not a line beyond which your take-home amount decreases. It is a line at which the share of tax on each additional yen earned rises from the 24% range to the 36% range. Even with the higher share, more than 60% of the additional earnings stays with you.

Note also that income here means the amount under tax law. It is the accounting profit after adjustments under tax-law rules, so it does not match the profit on the financial statements.

Which companies can use the special measure that makes the portion up to ¥8 million 15%?

The national 15% is not available to every small or medium-sized corporation. The conditions are as follows.

• Eligible companies: ordinary corporations, etc. whose amount of capital or investment is ¥100 million or less at the end of each business year. Mutual companies and ordinary corporations with a full control relationship with a large corporation are excluded［1］.
• Excluded business operators: a corporation whose average income in the base years exceeds ¥1.5 billion a year is excluded from the special measure, and the portion up to ¥8 million is also taxed at 19%［1］［2］.
• Group-taxation corporations: corporations under the group taxation system are also excluded from the special measure. For a small or medium-sized group-taxation corporation, the 19% applies to the portion obtained by allocating ¥8 million a year in proportion to the income of the corporations in the group［2］［5］.
• Business years in which income exceeds ¥1 billion a year: the rate on the portion up to ¥8 million becomes 17%. This applies to business years beginning on or after April 1, 2025 (Reiwa 7)［1］.
• Deadline: the special measure covers business years beginning on or before March 31, 2027 (Reiwa 9). Under the current law, the rate returns to the base 19% after that (this would change if an extension is enacted)［3］.

A different “¥8 million” that is easy to confuse

Small or medium-sized corporations have another “¥8 million”: the fixed-amount deduction for entertainment expenses, etc. This concerns the deductibility of entertainment expenses and is a separate system from the ¥8 million of profit［3］.

前項の場合において、法人（投資信託及び投資法人に関する法律第二条第十二項に規定する投資法人及び資産の流動化に関する法律第二条第三項に規定する特定目的会社を除く。）のうち当該適用年度終了の日における資本金の額又は出資金の額が一億円以下であるもの（次に掲げる法人を除く。）については、前項の交際費等の額のうち定額控除限度額（八百万円に当該適用年度の月数を乗じてこれを十二で除して計算した金額をいう。）を超える部分の金額をもつて、同項に規定する超える部分の金額とすることができる。［3］

Reference translation (unofficial): In the case of the preceding paragraph, for a corporation (excluding an investment corporation prescribed in Article 2, paragraph 12 of the Act on Investment Trusts and Investment Corporations and a specific purpose company prescribed in Article 2, paragraph 3 of the Act on Securitization of Assets) whose amount of capital or investment on the last day of the applicable year is ¥100 million or less (excluding the following corporations), the portion of the amount of entertainment expenses, etc. in the preceding paragraph that exceeds the fixed-amount deduction limit (meaning the amount calculated by multiplying ¥8 million by the number of months in the applicable year and dividing by twelve) may be treated as the excess amount prescribed in that paragraph.

In plain terms: a corporation with capital of ¥100 million or less can use a fixed-amount deduction for entertainment expenses of up to ¥8 million a year (prorated by month). This is a separate system from the ¥8 million of profit.［3］

You may also hear talk of adjusting executive compensation to bring the company’s profit to ¥8 million. That extends to the executive’s personal income tax, inhabitant tax and social insurance premiums, and goes beyond the scope of this article. If in doubt, consult your tax accountant (zeirishi).

Summary

“It pays for a small or medium-sized company to keep its profit at ¥8 million or less” is HALF TRUE.

• What is true is that there is a dividing line at ¥8 million, and before and after it the share of tax on each additional yen earned changes.
• What is wrong is the conclusion “it pays to stay at ¥8 million or less” and “if you go over ¥8 million, you lose.” The rate rises only on the portion above the line, and the rate on the portion up to ¥8 million does not change. If profit grows, your take-home amount grows too.
• The ¥8 million line appears in both national corporation tax and the income-based portion of local corporate enterprise tax. Enterprise tax is divided at ¥4 million and ¥8 million, and a company with capital of ¥10 million or more that has offices in three or more prefectures pays a flat 7.0%.
• Local corporation tax, special corporate enterprise tax and corporate inhabitant tax (corporation-tax-based portion) are calculated from the amount of corporation tax or of the income-based portion, and have no ¥8 million line. The per-capita portion of corporate inhabitant tax is a fixed amount regardless of earnings. Special defense corporation tax is also not charged at ¥8 million or less.
• Local taxes include excess tax rates set by local governments through ordinances. Check your own company’s rates in the ordinances of the local government where your offices are located.

Sources

• ［1］No.5759 Corporation tax rates — NTA Tax Answer (Japanese)　Checked: 2026-10-18
• ［2］No.5432 Small and medium-sized corporations and small and medium-sized businesses under the Act on Special Measures Concerning Taxation — NTA Tax Answer (Japanese)　Checked: 2026-10-18
• ［3］Act on Special Measures Concerning Taxation (Articles 42-3-2 and 61-4; e-Gov Law Search, Japanese)　Checked: 2026-10-18
• ［4］Corporation Tax Act (Article 66; e-Gov Law Search, Japanese)　Checked: 2026-10-18
• ［5］No.5900 Overview of the group taxation system — NTA Tax Answer (Japanese)　Checked: 2026-10-18
• ［6］Local Tax Act (Articles 51, 52, 312, 314-4 and 72-24-7; e-Gov Law Search, Japanese)　Checked: 2026-10-18
• ［7］Act on the Special Corporate Enterprise Tax and the Special Corporate Enterprise Transfer Tax (Articles 1, 2 and 7; e-Gov Law Search, Japanese)　Checked: 2026-10-18
• ［8］Local Corporation Tax Act (Article 10; e-Gov Law Search, Japanese)　Checked: 2026-10-18
• ［9］Tokyo Metropolitan Bureau of Taxation, “Corporate Enterprise Tax and Corporate Metropolitan Inhabitant Tax” (Japanese)　Checked: 2026-10-18
• ［10］Act on Special Measures for Securing Financial Resources Necessary for Fundamentally Strengthening Japan’s Defense Capabilities, etc. (Articles 9, 11, 13 and 14; e-Gov Law Search, Japanese)　Checked: 2026-10-18

Note: This article is based on laws and official information as of October 18, 2026. It is a translation of the Japanese original; if the two differ, the Japanese version prevails. Quotations from laws and official sources are given in the original Japanese, followed by unofficial reference translations. Sources are based on laws (e-Gov) and official materials of the NTA and the Tokyo Metropolitan Bureau of Taxation, all in Japanese. Tax rates may be revised. Tax amounts and effective tax rates are estimates based on the assumptions stated above. For individual decisions, please check with your advisory zeirishi (licensed tax accountant).