Deadline for registration of Qualified Invoice Issuer has been extended to 30 September 2023

A new JCT invoicing scheme, which is essentially similar to the EU VAT invoicing rules, will come into force on 1 October 2023. In the new JCT invoicing system, for claiming input JCT on purchases, taxpayers will be required to receive a qualified invoice (Qualified Invoice) from the supplier and keep record of the Qualified Invoice for JCT purposes. Suppliers will be required to be registered as the Qualified Invoice issuer with National Tax Agency (NTA).

The original deadline for the registration was 31 March 2023 to be duly registered from the commencement of the new JCT invoicing scheme, which is 1 October 2023.

However, to ease suppliers’ burden for the registrations, as a part of the 2023 tax reform plan, the government of Japan decided to treat the supplier as the Qualified Invoice issuer from day one as long as the registration forms are submitted to the NTA by 30 September 2021.

Notwithstanding the above, foreign business operators who are already registered as JCT taxpayers (kazei jigyousha) and foreign business operators for JCT purposes (touroku kokugai jigyousha) will automatically become Qualified Invoice issuers under the new JCT invoicing scheme without any additional steps to be taken.

Key takeaway

It is reported that 25% of Japanese corporations are not registered as Qualified Invoice issuer as of 31 December 2022 and that approximately 10% of JCT taxpayers may discontinue commercial transactions with non-registered suppliers. Therefore, if a supplier of JCT taxable sales is not registered, it should take all necessary actions soon.