Tax Statute of Limitations in Japan: What Happens If You Do Not File?

Many foreign residents assume that an unfiled tax return eventually disappears after a few years. However, Japan’s tax statute of limitations rules may allow the tax office to assess taxes much longer than expected.

Hi, my name is Taisei Koshida, and I am a certified public accountant and tax accountant.

I aim to assist non-Japanese business owners who struggle with reading or writing in Japanese. If you find the Japanese tax return system challenging, I can help you with your tax filings.

If you are unclear about the statute of limitations in Japan, you might find this blog helpful.

Many foreign business owners assume that failing to file a tax return eventually becomes irrelevant after a few years.

However, Japan’s statute of limitations rules can be more complex than expected, especially when no tax return has been filed.

If the Tax Office Does Not Consider the Failure to File Fraudulent

In general, the tax office has five years from the filing due date to assess additional taxes.

If the Tax Office Considers the Failure to File Fraudulent

In this case, the statute of limitations is seven years from the due date of the tax return. For example, if you receive your revenue in cash to hide business income, you are more likely to be considered fraudulent.

Our accounting firm has been actively assisting foreign business owners in Japan with accounting and tax matters.  If you are concerned about unfiled tax returns or past tax obligations in Japan, please feel free to contact us through the inquiry form.

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