Who needs to register?
There is a threshold in Japan which means you only are obliged to register once you breach. The below thresholds apply to digital services as well as physical products.
You can start storing in Japan without the JCT registration and then once you breach you will need to register.
A business must register for JCT if any of these apply:
Your sales two years ago were over ¥10 million
This past year is called the Base Period. Example: Your 2023 sales decide your JCT status for 2025
Your sales (or payroll) in the first 6 months of last year were over ¥10 million
This is the Specified Period. Example: Sales from Jan–Jun 2024 determine JCT status for 2025.
Your company’s paid‑in capital at the incorporation stage is ¥10 million or more
If so, you’re automatically a taxable business from day one, even if this capital is not from business in Japan. This is not based on turnover, assets, or retained earnings — it is strictly the legal capital contributed by investors.
You choose to register voluntarily
You can register even if you don’t meet the thresholds. This lets you issue qualified invoices, which some customers may require, for example for B2B transactions.
Documents Required to Start VAT Registration:
- Articles of Organisation / Incorporation / Business Extract
- Director’s proof of address (x2)
- Director's valid passport
- Website/Amazon seller profile in Japan active
- For all non-local companies, there must be a fiscal representative based in Japan to manage communication with the authorities.
Registration Timeframes:
- Corporate number : 2-3 months
- JCT number : 1 month
- Total approximately 4 months
Declaration Timeframes
- There is a summary return completed at the end of the year to confirm all sales and tax to be paid.
Additional returns called "interim returns" are required if the tax to be declared goes over the below amounts:
Half year : If the tax due is ¥480 000 - ¥4 000 000
Quarterly : If the tax due is : ¥4 000 000 - ¥48 000 000
Monthly : If the tax exceeds : ¥48 000 000
JCT Rates:
Standard rate: 10%
Reduced rate: 8% for specific items