Regulation for Enforcement of the Act on Special Provisions concerning Preservation Methods for Books and Documents Related to National Tax Prepared by Means of Computers

In this Ministerial Order, "national tax," "books and documents related to national tax," "electronic or magnetic record," "person required to preserve," "electronic transaction," or "computer output microfilm" means, respectively, national tax, books and documents related to national tax, an electronic or magnetic record, a person required to preserve, an electronic transaction, or computer output microfilm prescribed in Article 2 of the Act on Special Provisions concerning Preservation Methods for Books and Documents Related to National Tax Prepared by Means of Computers (Act No. 25 of 1998; hereinafter referred to as the "Act").

In this Ministerial Order, the meanings of the terms set forth in the following items are as prescribed respectively in those items:

Computer processing: means the input, accumulation, editing, processing, correction, updating, retrieval, deletion, or output of information performed using a computer, or processing similar thereto;

The books related to national tax specified by Ministry of Finance Order prescribed in Article 4, paragraph (1) of the Act are books that are required to be kept and preserved pursuant to the provisions of the Income Tax Act (Act No. 33 of 1965) or the Corporation Tax Act (Act No. 34 of 1965), other than those in which all transactions affecting assets, liabilities, and capital are recorded in an orderly and clear manner in accordance with the principles of regular bookkeeping (in the case of books required to be kept and preserved pursuant to the provisions of the Corporation Tax Act, the principles of double-entry bookkeeping).

together with the keeping and preservation of the electronic or magnetic records relating to those books related to national tax, to keep the following documents (excluding the documents set forth in (a) and (b) where a program other than one developed by the person required to preserve (meaning commands to a computer that are combined so as to obtain one result; the same applies hereinafter in this paragraph and in paragraph (6), item (iv)) is used for the computer processing relating to those books related to national tax, and excluding the document set forth in (c) where the computer processing relating to those books related to national tax is entrusted to another person (excluding a person who uses a program developed by the person required to preserve for that computer processing)):

a document stating an outline of the computer processing system (meaning a system relating to computer processing; the same applies hereinafter) relating to those books related to national tax;

a document prepared in the course of developing the computer processing system relating to those books related to national tax;

an operating manual for the computer processing system relating to those books related to national tax;

a document clarifying the administrative procedures for the computer processing relating to those books related to national tax and for the keeping and preservation of the electronic or magnetic records relating to those books related to national tax (where that computer processing is entrusted to another person, the contract relating to that entrustment and a document clarifying the administrative procedures for the keeping and preservation of the electronic or magnetic records relating to those books related to national tax);

to equip the place where the electronic or magnetic records relating to those books related to national tax are kept and preserved with computers, programs, displays, and printers that can be used for the computer processing of those electronic or magnetic records, and with operating manuals for them, and to make it possible to promptly output those electronic or magnetic records on a display screen and in writing in an orderly format and clear state;

to make it possible to comply with a request to present or submit the electronic or magnetic records relating to those books related to national tax under the provisions of laws concerning national tax.

The documents specified by Ministry of Finance Order prescribed in Article 4, paragraph (3) of the Act are, among documents related to national tax, inventory lists, balance sheets, and profit and loss statements, and other documents prepared in relation to calculation, arrangement, or settlement of accounts.

The device specified by Ministry of Finance Order prescribed in Article 4, paragraph (3) of the Act is a scanner.

A person required to preserve who intends, pursuant to the provisions of Article 4, paragraph (3) of the Act, to substitute the preservation of electronic or magnetic records relating to documents related to national tax (limited to documents related to national tax prescribed in that paragraph; the same applies hereinafter in this Article) for the preservation of those documents related to national tax must preserve those electronic or magnetic records in accordance with the following requirements (excluding the requirement set forth in item (v) (limited to the part pertaining to (b) and (c)) where the person required to preserve is able to comply with a request to present or submit those electronic or magnetic records under the provisions of laws concerning national tax).

to input by any of the following methods:

to input the recorded matters relating to those documents related to national tax promptly after their preparation or receipt;

to input the recorded matters relating to those documents related to national tax promptly after the ordinary period for processing the relevant business has elapsed (limited to the case where rules on the processing of each task from the preparation or receipt of those documents related to national tax to that input have been established);

in the input under the preceding item, to use a computer processing system satisfying the following requirements (excluding the requirement set forth in (b) where the person required to preserve is able to confirm that the person has input the recorded matters relating to those documents related to national tax by the method set forth in (a) or (b) of that item):

it is a computer processing system that uses a scanner (limited to one satisfying the following requirements):

it reads at a resolution of 200 dots or more per 25.4 millimeters, which is the resolution for scanning general documents prescribed in A.1.2 of Annex A of Japanese Industrial Standards (meaning the Japanese Industrial Standards prescribed in Article 20, paragraph (1) (Japanese Industrial Standards) of the Industrial Standardization Act (Act No. 185 of 1949); the same applies hereinafter) Z 6016;

it reads gradations of each of red, green, and blue at 256 or more levels;

promptly after the preparation or receipt of those documents related to national tax, to attach to the recorded matters of the electronic or magnetic record for each input unit a time stamp (limited to one satisfying the following requirements; hereinafter in this item and in Article 4, paragraph (1), items (i) and (ii) referred to as a "time stamp") relating to a time certification business certified by the Minister for Internal Affairs and Communications (meaning a business that provides services of attaching time stamps to information recorded in electronic or magnetic records) (where rules on the processing of each task from the preparation or receipt of those documents related to national tax to the attachment of that time stamp have been established, after the ordinary period for processing the relevant business has elapsed, promptly to attach that time stamp to those recorded matters):

it can be confirmed, throughout the preservation period of those documents related to national tax (meaning the period during which the preservation of documents related to national tax is required under the provisions of laws concerning national tax), that those recorded matters have not been altered, by a method of confirming with the person who conducts that business or by any other method;

it is a computer processing system that satisfies any of the following requirements with regard to the recorded matters of the electronic or magnetic records relating to those documents related to national tax:

where the recorded matters of the electronic or magnetic records relating to those documents related to national tax have been corrected or deleted, it is possible to confirm these facts and their content;

it is impossible to correct or delete the recorded matters of the electronic or magnetic records relating to those documents related to national tax;

to make it possible to confirm the mutual relationship between the recorded matters of the electronic or magnetic records relating to those documents related to national tax and the recorded matters of the books related to national tax prescribed in Article 2, item (ii) of the Act that are related to those documents related to national tax (where those books related to national tax are books for which the keeping and preservation of the electronic or magnetic records relating to those books has been substituted for the keeping and preservation of those books pursuant to Article 4, paragraph (1) of the Act, or books for which the keeping of those electronic or magnetic records and their preservation by computer output microfilm has been substituted for the keeping and preservation of those books pursuant to Article 5, paragraph (1) or (3) of the Act, the recorded matters of those electronic or magnetic records or that computer output microfilm);

at the place where the electronic or magnetic records relating to those documents related to national tax are preserved, to equip computers, programs, color displays with a maximum screen diameter of 35 centimeters or more, and color printers, which can be used for the computer processing of those electronic or magnetic records, and operating manuals for them, and to make it possible to promptly output those electronic or magnetic records on a color display screen and in writing in the following state:

being in an orderly format;

being as clear as those documents related to national tax;

being capable of being output in enlarged or reduced form;

being such that, as provided by the Commissioner of the National Tax Agency, characters of the four-point size prescribed in Japanese Industrial Standards Z 8305 can be recognized;

to ensure a function enabling a search of the recorded matters of the electronic or magnetic records relating to those documents related to national tax (limited to one satisfying the following requirements):

it is possible to set the transaction date or other date, the transaction amount, and the business partner (referred to as "record items" in (b) and (c)) as search conditions;

for record items relating to a date or amount, it is possible to set a condition by specifying a range thereof;

it is possible to set a condition by combining two or more arbitrary record items;

the provisions of paragraph (2), item (i) apply mutatis mutandis to the preservation of electronic or magnetic records by a person required to preserve who intends, pursuant to the provisions of Article 4, paragraph (3) of the Act, to substitute the preservation of electronic or magnetic records relating to documents related to national tax for the preservation of those documents related to national tax.

Where a person required to preserve prescribed in Article 4, paragraph (3) of the Act proves that, due to a disaster or other unavoidable circumstances, the person was unable to preserve the electronic or magnetic records relating to the documents related to national tax prescribed in the first sentence of that paragraph in accordance with the Ministry of Finance Order prescribed in the first sentence of that paragraph, the person may, notwithstanding the preceding two paragraphs, preserve those electronic or magnetic records; provided, however, that this does not apply where, had those circumstances not arisen, it is found that the person would not have been able to preserve those electronic or magnetic records in accordance with that Ministry of Finance Order.

Where a person required to preserve who substitutes, pursuant to the provisions of Article 4, paragraph (3) of the Act, the preservation of electronic or magnetic records relating to documents related to national tax for the preservation of those documents related to national tax records in electronic or magnetic records the matters stated in those documents related to national tax that were prepared or received before the date on which the preservation of those documents related to national tax is replaced (referred to as the "base date" in item (ii)) (excluding general documents; hereinafter in this paragraph through paragraph (11) referred to as "past important documents"), and has submitted in advance a written notification stating the type of the past important documents relating to the matters to be recorded and the following matters (hereinafter in this paragraph and the following paragraph referred to as an "application notification") to the competent district director with jurisdiction over the place for tax payment, etc. (where the past important documents are documents under the proviso to Article 52, paragraph (4) (Obligation to Keep Books) of the Order for Enforcement of the Liquor Tax Act (Cabinet Order No. 97 of 1962), the proviso to Article 17, paragraph (5) (Obligation to Keep Books) of the Order for Enforcement of the Tobacco Tax Act (Cabinet Order No. 5 of 1985), the proviso to Article 17, paragraph (5) (Obligation to Keep Books) of the Order for Enforcement of the Gasoline Tax Act (Cabinet Order No. 57 of 1957), the proviso to Article 21, paragraph (4) (Obligation to Keep Books) of the Order for Enforcement of the Liquefied Petroleum Gas Tax Act (Cabinet Order No. 5 of 1966), or the proviso to Article 20, paragraph (8) (Obligation to Keep Books) of the Order for Enforcement of the Petroleum and Coal Tax Act (Cabinet Order No. 132 of 1978), or import permits, documents under Article 27, paragraph (6) (Matters to Be Stated in Books, etc.) of the Regulation for Enforcement of the Consumption Tax Act (Ministry of Finance Order No. 53 of 1988) or documents certifying that import permission has been granted, or a passenger list prescribed in the proviso to Article 7 (limited to the part pertaining to overseas business operators under that Article) (Obligation to Keep Books) of the Order for Enforcement of the International Tourist Tax Act (Cabinet Order No. 161 of 2018), the Director-General of Customs with jurisdiction over the place for tax payment, etc.; referred to as the "competent district director, etc." in the following paragraph) (limited to the case where the person has not previously submitted an application notification relating to documents of the same type as those past important documents), the person may, notwithstanding the requirement set forth in paragraph (6), item (i), preserve the electronic or magnetic records relating to those past important documents by keeping, together with the preservation of those electronic or magnetic records, a document clarifying the administrative procedures for the preparation and preservation of those electronic or magnetic records (limited to one for which the person responsible for those administrative matters has been determined). In this case, with regard to the application of the provisions of that paragraph, the phrase "promptly after the preparation or receipt of those documents related to national tax," in item (ii), (b) of that paragraph is deemed to be replaced with "when reading those documents related to national tax with a scanner,", and the phrase "(meaning a business that provides services of attaching time stamps to information recorded in electronic or magnetic records) (where rules on the processing of each task from the preparation or receipt of those documents related to national tax to the attachment of that time stamp have been established, after the ordinary period for processing the relevant business has elapsed, promptly to attach that time stamp to those recorded matters)" in that item is deemed to be replaced with "(meaning a business that provides services of attaching time stamps to information recorded in electronic or magnetic records)".

the base date;

any other matters for reference.

Where, with regard to the past important documents for which the person required to preserve prescribed in the preceding paragraph intends to receive the application of that paragraph, there is, besides the competent district director, etc., a district director who is convenient for submitting the application notification (hereinafter in this paragraph referred to as a "district director other than the competent district director"), and that district director other than the competent district director finds that there are reasonable grounds for the circumstances making it convenient, the person may submit to the competent district director, etc., via that district director other than the competent district director, an application notification stating the details of the circumstances making it convenient. In this case, where the application notification has been accepted by the district director other than the competent district director, the application notification is deemed to have been submitted to the competent district director, etc. on the date on which it was accepted.

Where a person required to preserve who preserves the electronic or magnetic records relating to past important documents pursuant to the provisions of paragraph (9) proves that, due to a disaster or other unavoidable circumstances, the person has become unable to preserve those electronic or magnetic records in accordance with the Ministry of Finance Order prescribed in the first sentence of Article 4, paragraph (3) of the Act, the person may, notwithstanding the provisions of paragraph (9), preserve those electronic or magnetic records; provided, however, that this does not apply where, had those circumstances not arisen, it is found that the person would have become unable to preserve those electronic or magnetic records in accordance with that Ministry of Finance Order.

The requirements specified by Ministry of Finance Order prescribed in the second sentence of Article 4, paragraph (3) of the Act are that the electronic or magnetic records relating to the documents related to national tax in the second sentence of that paragraph are preserved, at the place where those documents related to national tax are preserved, for the period during which the preservation of those documents related to national tax is required under the provisions of laws concerning national tax.