Skip to content

Accounting Intelligence Blog

Talk about tax and corporate finance in Japan

  • Our profile
  • Pricing: 値段表
  • お問合せフォーム Contact Form
  • Career Oppotunities
  • Home
  • 2022
  • July
  • 4
  • Benefit of Blue Form Tax filer status

Benefit of Blue Form Tax filer status

Posted on July 4, 2022 By user
Corporate Tax, Tax saving

There are two tax filing statuses. One is called Blue Form filer and the other is called White Form filer. If you have your own company or have your own proprietorship, you should choose Blue Form filer status as your tax status because it is much better and basically there will be nothing to lose.

Benefit of carrying losses to future

Blue Form Filer Status has a lot of tax benefit but the biggest one is you will be allowed to carry your tax losses to the next 10 years.
For example, if you make tax loss of 10 MM yen in this year (Year #1) and you make taxable income of 12 MM yen in the next year (Year #2), your taxable income for Year #2 will be only 2 MM yen if you are Blue. If you are a White Form filer, your taxable income will be 12 MM yen, because you are not entitled to carry tax losses and you are taxed based on each year’s income.
So, if you make tax losses, they will be waisted each year when it is incurred, and if you make taxable income, you will have to pay the tax on the full amount.
There is another relatively major tax benefit for sole proprietors. You will get 650,000 yen extra deduction from your taxable income. If you are making 5,000,000 yen a year after all the expenses, your marginal tax rate is 30%(20% for National Tax and 10% for Resident Tax).
https://www.nta.go.jp/taxes/shiraberu/taxanswer/shotoku/2260.htm
You are saving 195,000 yen as tax every year. If you run your business for 20 years, you will save 3,900,000 yen as tax in total. It is a significant amount. At least, it is for me.

How to become a Blue Form filer

You should submit the following form to the tax office.
https://www.nta.go.jp/law/tsutatsu/kobetsu/hojin/010705/pdf/056-1.pdf
you will be a Blue Form filer from the next year.

Deadline to become a Blue Form tax filer

if it is a newly set up company, an application form has to be submitted within 3 month. If it is a sole proprietor, it has to be done within 2 months.
For existing companies and sole proprietors that have been operating for years, the deadline to become one for the next year is the end of this fiscal year. If you would like to become one as a company for calendar year 2023, the deadline is the end of 2022.
If you are a sole proprietor, your deadline is March 15th of the year that you want to become. For example, if you would like to have a Blue Form filer status for 2023, the deadline is March 15th, 2023.

Post navigation

❮ Previous Post: Tax Permanent Resident status vs Permanent Residency for VISA
Next Post: 4 important things you need to know when you start your own business ❯

Recent Posts

  • Carried Losses for non-SMEs
  • 蓝表申报人身份的诸多好处
  • 消费税出口退税时的须知事项
  • RPAとPythonはどう違うの?Power Automateでエクセルの操作をしてみました。
  • Power Automateをやって見ました。

Recent Comments

No comments to show.

Archives

  • January 2023
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • January 2021
  • November 2020
  • July 2020
  • April 2020
  • March 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • February 2016
  • December 2015
  • October 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015

Categories

  • About our firm
  • Accounting and DX
  • Consumption Tax
  • Corporate Tax
  • cross border related tax
  • Estate Tax
  • Investing in Japan
  • M&A
  • Personal Tax
  • routine tax practices
  • Setting up organization
  • Starting a business in Japan
  • Tax
  • Tax saving
  • TK
  • Uncategorized
  • Valuation of stock in private company
  • Withholding Tax
  • キャリア
  • システム開発
  • スタートアップの経理と税金
  • プログラミングで効率化
  • ブロックチェーンと仮想通貨
  • ランニング
  • 中国語
  • 中文税金
  • 事業の成長・経営
  • 事業承継
  • 企業再編
  • 会社・支店の設立関係
  • 会社の解散・清算
  • 会社節税
  • 会計事務所独立・経営
  • 会計基準関係
  • 国際税務
  • 小さな会社の経理と税金
  • 山
  • 投資スキームと税金
  • 未分類
  • 本
  • 法人税関係
  • 洋書の読書ガイド
  • 消費税(日本語)
  • 監査など
  • 相続
  • 英語学習
  • Our profile
  • Pricing: 値段表
  • お問合せフォーム Contact Form
  • Career Oppotunities

Copyright © 2023 Accounting Intelligence Blog.

Theme: Oceanly by ScriptsTown