Consumption Tax (JCT) invoice rules in Japan

In Japan an invoice must show your registration number, itemised lines, and Consumption Tax (JCT) separately at the applicable rate — 8%, 10%, with 10% applying to most work. A qualified invoice (適格請求書) showing the registration number, the tax-exclusive or tax-inclusive amount per rate band, and the consumption tax per band.

The Japan rule people miss

Under the qualified invoice system your T-number must appear on the invoice, otherwise your business customer cannot claim the input credit — which makes unregistered suppliers materially less attractive to B2B buyers, regardless of price.

When Consumption Tax (JCT) registration becomes compulsory

Businesses under ¥10 million in taxable sales two years prior are exempt, but many register voluntarily anyway: staying exempt means your business customers lose their credit, and they will notice.

Assessed on a rolling twelve months in most systems, not your financial year — which is the detail that catches people out.

Which Consumption Tax (JCT) rate applies to what

8% applies to food and drink other than alcohol and dining out, and to newspapers issued at least twice weekly under subscription. Takeaway is 8%; eating in is 10% — the same sandwich, two rates.

Bands are defined by what you supply, not by who buys it.

How often you file in Japan

Most businesses file JCT annually, with interim payments once the prior year's liability passes set thresholds. The bigger change is the qualified invoice system in force since October 2023: without your registration number on the document, your business customer cannot claim the input credit — which quietly makes an unregistered supplier more expensive than a registered one.

A worked Consumption Tax (JCT) example

Invoice ¥4,100 with a 5% discount shown on the document:

• Net before discount: ¥4,100
• Discount at 5%: −¥205
• Taxable value: ¥3,895
• Consumption Tax (JCT) at 10%: ¥389.5
• Total due: ¥4,284.5

The discounted value is what gets taxed — discounts, deposits and advance payments covers where that stops being obvious.

Correcting an invoice in Japan

Returns, rebates and discounts need a qualified return-invoice, which carries the same registration-number requirement as the original. Small adjustments are relieved from the paperwork, but the relief is a threshold rather than a general exemption.

Invoicing outside Japan

Exported services to overseas customers are generally zero-rated, but the evidence requirements are strict and the default assumption by the tax office is that a supply is domestic unless you can show otherwise.

Charging tax to a client in another country covers the general shape.

Record keeping in Japan

Seven years for invoices and books, with some documents required for ten. What to hand your accountant at year end.

The universal fields — number, both parties, dates, lines, tax separately, total — apply on top of the local rules above. Rates change: checked to mid-2026, a starting point rather than tax advice; verify against the National Tax Agency.

Set your country once in EstimateBill and the tax is labelled correctly on every invoice after that — GST and GSTIN in India, VAT in the UK, Sales Tax and EIN in the US, across 58 countries.