What Happens in Japanese Tax Audits if You Discard Ledgers and Documents?

【Koshida Accounting Firm Column Date:

Hi, my name is Taisei Koshida, and I am a certified public accountant as well as a 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 Japanese taxpayer’s obligations, you might find this blog helpful.




The obligation of keeping ledgers and documents.

Under Japanese tax laws, taxpayers have obligations to maintain ledgers and relevant documents for seven years, and to present them properly to tax officers when tax audits are conducted.


Presumed taxation

If taxpayers cannot fulfill this obligation, they may be subject to presumed taxation; this involves calculating the tax amount based on logical reasoning rather than individual facts.


Cancellation of blue tax return

This is done by cancelling the blue tax return, a form that most taxpayers choose. Due to this action, taxpayers can no longer receive tax-related benefits such as carrying over accumulated losses.




Our accounting firm has been actively assisting foreign business owners in Japan with accounting and tax matters. Please feel free to contact us through the inquiry form.