E-invoicing compliance and regulatory updates - Japan

Electronic Invoicing Japan

For a long time, electronic invoicing has not been possible in Japan. But in 2019, the Japanese government implemented a new Japanese Consumption Tax (JCT) system with multiple tax rates. This introduced the option to no longer go through the ledger system for tax reporting, but instead add tax on to the invoice itself—provided both the supplier and buyer are registered with the Japanese National Tax Agency (NTA). This new taxing system is considered a major improvement that will help solve the tax leakage.

Furthermore, in the last few years, we have seen the Japanese government attempting to shift the country’s inclination towards paper-based transactions. Japan has been trying to speed up the capacity of economic transformation across the country, introducing the Qualified Invoice System (“QIS” or in Japanese “tekikaku-seikyu-sho”), which will be used to exchange invoices electronically as of 1 October 2023.

According to the new scheme, registered taxpayers will be eligible to issue qualified tax invoices, and on the buyer side, taxpayers will only be eligible for input tax credit where a qualified tax invoice has been issued. On the other hand, e-invoicing will be explicitly allowed for tax invoices subject to the buyer´s consent.

In July 2020, the E-invoice Promotion Association (EIPA) was established to develop and promote a standard e-invoice specification. EIPA has been conducting different research projects and plans to build a standardised e-invoice system –in 2021 the adoption of Peppol was proposed as the new national standard. Peppol service providers will also become a critical part of the setup and have a fair share in e-invoicing businesses.

Even though the launch of the new invoicing system is planned for October 2023, it will be possible to use the system as early as October 2022.

In order to issue qualified invoices, JCT taxpayers must register with Japan’s National Tax Agency (“NTA”). Applications must be filed no later than 30th September 2023.

On September 2022, Basware received acknowledgment as a Peppol Service Provider from the Digital Agency of Japan. For more information, you can read our short blog post here.

Want to learn more about e-Invoicing compliance?

Download our Global e-invoicing and Tax Compliance fact sheet here for more information.

Download now

Electronic Invoicing Japan

For a long time, electronic invoicing has not been possible in Japan. But in 2019, the Japanese government implemented a new Japanese Consumption Tax (JCT) system with multiple tax rates. This introduced the option to no longer go through the ledger system for tax reporting, but instead add tax on to the invoice itself—provided both the supplier and buyer are registered with the Japanese National Tax Agency (NTA). This new taxing system is considered a major improvement that will help solve the tax leakage.

Furthermore, in the last few years, we have seen the Japanese government attempting to shift the country’s inclination towards paper-based transactions. Japan has been trying to speed up the capacity of economic transformation across the country, introducing the Qualified Invoice System (“QIS” or in Japanese “tekikaku-seikyu-sho”), which will be used to exchange invoices electronically as of 1 October 2023.

According to the new scheme, registered taxpayers will be eligible to issue qualified tax invoices, and on the buyer side, taxpayers will only be eligible for input tax credit where a qualified tax invoice has been issued. On the other hand, e-invoicing will be explicitly allowed for tax invoices subject to the buyer´s consent.

In July 2020, the E-invoice Promotion Association (EIPA) was established to develop and promote a standard e-invoice specification. EIPA has been conducting different research projects and plans to build a standardised e-invoice system –in 2021 the adoption of Peppol was proposed as the new national standard. Peppol service providers will also become a critical part of the setup and have a fair share in e-invoicing businesses.

Even though the launch of the new invoicing system is planned for October 2023, it will be possible to use the system as early as October 2022.

In order to issue qualified invoices, JCT taxpayers must register with Japan’s National Tax Agency (“NTA”). Applications must be filed no later than 30th September 2023.

On September 2022, Basware received acknowledgment as a Peppol Service Provider from the Digital Agency of Japan. For more information, you can read our short blog post here.

Want to learn more about e-Invoicing compliance?

Download our Global e-invoicing and Tax Compliance fact sheet here for more information.

Download now

Archiving

Invoices must be stored for 10 years. The integrity, authenticity and availability of the invoices must be ensured.

Storage abroad is allowed with online access, readability and printability.

Want to know more about Basware’s archiving services?

Download our Basware Vault fact sheet here to learn more about our flexible and scalable solution.

Download now

Basware Services

Basware is a certified Peppol access point and exchanges over 5 million business documents per year over the Peppol network.

Basware offers CloudScan for clients to scan paper invoices using optical character recognition (OCR) technology. Scan and Capture service is available.

Want to find out how we can help in your specific case?

Speak to a member of our team to learn more.

Contact us

Interoperability

The Peppol network is a true “connect once, reach all” network. Once connected to Peppol through an access point—which Basware is—you can reach all other participants in Japan, as well as all other Peppol receivers in other countries.

Our advice

Currently, we advise customers in Japan to prepare for the QIS implementation that is coming into play from 1 October 2023. This impacts the exchange of the invoices itself but it also touches on the invoice templates used to send invoices, report taxes, and process invoices themselves.

For paper documents Basware advises to use CloudScan with self-validation for light volumes or to use Scan and Capture for higher transaction volumes.

Want to understand how we can help in your case?

Get in touch with our experts.

Contact us

Back to Compliance Map

Electronic Invoicing Japan

For a long time, electronic invoicing has not been possible in Japan. But in 2019, the Japanese government implemented a new Japanese Consumption Tax (JCT) system with multiple tax rates. This introduced the option to no longer go through the ledger system for tax reporting, but instead add tax on to the invoice itself—provided both the supplier and buyer are registered with the Japanese National Tax Agency (NTA). This new taxing system is considered a major improvement that will help solve the tax leakage.

Furthermore, in the last few years, we have seen the Japanese government attempting to shift the country’s inclination towards paper-based transactions. Japan has been trying to speed up the capacity of economic transformation across the country, introducing the Qualified Invoice System (“QIS” or in Japanese “tekikaku-seikyu-sho”), which will be used to exchange invoices electronically as of 1 October 2023.

According to the new scheme, registered taxpayers will be eligible to issue qualified tax invoices, and on the buyer side, taxpayers will only be eligible for input tax credit where a qualified tax invoice has been issued. On the other hand, e-invoicing will be explicitly allowed for tax invoices subject to the buyer´s consent.

In July 2020, the E-invoice Promotion Association (EIPA) was established to develop and promote a standard e-invoice specification. EIPA has been conducting different research projects and plans to build a standardised e-invoice system –in 2021 the adoption of Peppol was proposed as the new national standard. Peppol service providers will also become a critical part of the setup and have a fair share in e-invoicing businesses.

Even though the launch of the new invoicing system is planned for October 2023, it will be possible to use the system as early as October 2022.

In order to issue qualified invoices, JCT taxpayers must register with Japan’s National Tax Agency (“NTA”). Applications must be filed no later than 30th September 2023.

On September 2022, Basware received acknowledgment as a Peppol Service Provider from the Digital Agency of Japan. For more information, you can read our short blog post here.

Want to learn more about e-Invoicing compliance?

Download our Global e-invoicing and Tax Compliance fact sheet here for more information.

Download now