Can Travel to Your Home Country Be a Business Expense in Japan?

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

I assist foreign business owners who may have difficulty dealing with Japanese accounting and tax procedures. If you find the Japanese tax system challenging, I can help you with your tax filings.

If you live and run a business in Japan, you may sometimes travel back to your home country to visit family and also take care of business while you are there.

Can any part of the travel cost be claimed as a business expense in Japan? Let’s look at two simple cases.

Traveling Only to Visit Family

Suppose the purpose of your trip is purely personal, such as visiting family or taking a vacation. In that case, the travel costs generally cannot be claimed as business expenses because the trip is not related to your business.

The fact that you are a business owner does not make the cost of traveling to your home country a business expense.

Combining a Family Visit with Business

The situation is different if you combine a family visit with genuine business activities, such as meeting clients or business partners in your home country.

In that case, part of the travel costs may be deductible as a business expense. However, simply having one business meeting during a personal trip does not automatically make the entire trip, or even a fixed percentage of the airfare, deductible.

You need to consider the actual purpose of the trip and reasonably separate the business portion from the personal portion.

For example, the number of days spent on business and personal activities may be one factor in determining a reasonable allocation. It is also important to keep records showing the business purpose, such as meeting schedules, emails, receipts, and other supporting documents.

Business or Personal? The Purpose Matters

When you travel to your home country, whether the cost is deductible in Japan depends on the actual purpose of the trip.

A personal trip to visit family is generally not a business expense. If the trip includes genuine business activities, however, part of the cost may be deductible depending on the circumstances.

If a trip has both business and personal purposes, keep records and make sure you can reasonably explain how you determined the business portion.

Koshida Accounting and Tax Office assists foreign business owners in Japan with accounting and tax matters.

If you are unsure whether travel or other expenses can be deducted for Japanese tax purposes, please feel free to contact us through the inquiry form.