Japan Tax Guide for Foreign-Owned Subsidiaries — Registrations, Filings, and Deadlines

Note: This article is general information, not tax advice for any specific situation. Rules change over time (this reflects the system as of July 2026) — please confirm with a professional before acting.

What this guide covers

After a foreign company establishes a Japanese subsidiary, what needs to be filed, when, and where? This is a chronological roadmap of Japanese tax obligations, written for companies with no accounting staff in Japan. We keep the jargon to a minimum.

STEP 1 | Tax registrations right after incorporation

Corporate establishment notification — to the tax office within 2 months of incorporation. Similar notifications go to the prefecture and municipality (deadlines vary by locality)
Blue-form tax return application — a status with significant benefits, including carrying forward tax losses. File within 3 months of incorporation or by the day before your first fiscal year-end, whichever comes first
Salary-paying office notification — if you pay salaries to directors or employees (within 1 month)
Application for semiannual withholding tax payment — if you regularly employ fewer than 10 people, withholding tax on salaries can be paid twice a year instead of monthly

Missing the blue-form deadline is particularly costly — you may lose the ability to carry your first-year losses forward. Start these filings as soon as the corporate registration is complete.

STEP 2 | Understand where you stand on consumption tax (JCT)

Whether your company must charge and remit Japanese consumption tax (standard rate 10%, reduced rate 8%) depends on your situation.

A company incorporated with capital of JPY 10 million or more is a taxable enterprise from year one
Even below that threshold, subsidiaries of large groups can be taxable from the start under special rules
You will likely need to consider registering as a qualified invoice issuer (the “invoice system”) depending on your customers

Foreign-owned subsidiaries are often taxable from year one because of their capital or parent-company size. Thinking about consumption tax at the capital-setting stage gives you more options.

STEP 3 | Know the annual tax calendar

Within 2 months after fiscal year-end — corporate tax, local taxes, and consumption tax filings and payment (filing extensions are available by application, though interest considerations apply to payment)
Mid-year — interim filings and payments may be required depending on the prior year’s tax
December — year-end payroll adjustment (settling employees’ income tax)
End of January — statutory reports, salary payment reports to municipalities, and depreciable asset returns

Head-office reporting deadlines (often December closings) tend to collide with Japanese tax deadlines. Building the annual calendar first makes head-office communication much easier.

STEP 4 | Withholding tax on payments to your head office

Royalties (trademarks, software), interest, and dividends paid to the foreign parent are generally subject to Japanese withholding tax
Tax treaties can reduce or eliminate the rate, but filing a treaty notification in advance is generally required

Missed withholding on remittances to the parent company is one of the most common errors we see at foreign-owned subsidiaries. Whenever a new intercompany agreement (royalty, loan, etc.) is signed, check the withholding implications first.

STEP 5 | Build accounting that runs without in-house staff

Most subsidiaries start without a dedicated accountant in Japan. With cloud accounting (freee), bookkeeping can be outsourced while your head office checks the numbers in real time. KJTax Japan provides bookkeeping, monthly English reporting, and annual filings as one integrated service.

Common pitfalls

Missing the blue-form application deadline (losing first-year loss carryforward)
Forgetting the prefectural/municipal establishment notifications
Missed withholding on royalty or interest payments to the parent
Overlooking invoice-system registration and creating friction with customers
Underestimating the January workload (statutory reports, salary reports)

Summary

Registrations → consumption tax → annual calendar → withholding → accounting setup. Cover these five steps in order and Japanese tax becomes manageable. KJTax Japan supports the entire journey in English.