Order for Enforcement of the Income Tax Act

The head of the business office of a financial institution or other such place must, as provided by Ministry of Finance Order, submit to the Commissioner of the National Tax Agency, through the competent district director with jurisdiction over the location of that business office of a financial institution or other such place, a written notice stating the name and location of that business office of a financial institution or other such place, the individual number or corporate number (meaning the corporate number prescribed in Article 2, paragraph (16) (Definitions) of the Act on the Use of Numbers to Identify a Specific Individual in Administrative Procedures; the same applies hereinafter) (in the case of an individual who has no individual number, the name and location) of the financial institution, etc. (meaning a person listed in the items of Article 32 (Scope of Financial Institutions, etc.)) pertaining to that business office of a financial institution or other such place, and other matters.

Upon the submission of the written notice set forth in the preceding paragraph, the Commissioner of the National Tax Agency may, for all or some of the business offices of financial institutions or other such places pertaining to that written notice, determine a number for each such business office of a financial institution or other such place (hereinafter in this Article referred to as the "office number"), or change that office number.

When the Commissioner of the National Tax Agency has determined or changed an office number under the preceding paragraph, the Commissioner is to notify the head of the business office of the financial institution or other such place concerned, in writing, to that effect and of that office number.

The head of the business office of a financial institution or other such place that has received notice of an office number is to add that office number to the documents prescribed in this Section that are submitted to the district director (including electronic or magnetic records recording the matters to be stated in those documents that are provided by electronic or magnetic means).

The amount calculated as provided by Cabinet Order prescribed in Article 11, paragraphs (1) and (2) (Nontaxability of Public Corporations and Charitable Trusts) of the Act is, in accordance with the categories of cases listed in the following items, the amount specified in the relevant item.

Where a Domestic Corporation prescribed in Article 11, paragraph (1) of the Act (hereinafter in this Article through Article 51-4 (Submission of Tax-Exemption Return Forms Concerning Interest, etc. on Public and Corporate Bonds, etc.) referred to as a "public corporation, etc."), or the trustee of a public interest trust or participant protection trust prescribed in Article 11, paragraph (2) of the Act (hereinafter in this Article through Article 51-4 referred to as a "public interest trust, etc.") has, throughout the calculation period for distributions of proceeds from a beneficial interest in a Loan Trust that it owns or that belongs to the trust property of the public interest trust, etc., had an entry or record made in the transfer account book of a financial institution (meaning the transfer account book kept under the Act on Book-Entry Transfer of Corporate Bonds and Shares by a person listed in Article 32, items (i), (iv), and (v) (Scope of Financial Institutions, etc.); the same applies hereinafter in this Article and Article 51-3) pursuant to Article 51-3, paragraph (1) (Recording of Securities Pertaining to Public and Corporate Bonds, etc.), or placed it in custody: the amount of the distribution of proceeds corresponding to that calculation period;

Where a public corporation, etc. or the trustee of a public interest trust, etc. has, in the middle of the calculation period for distributions of proceeds from a beneficial interest in a Loan Trust that it owns or that belongs to the trust property of the public interest trust, etc., had an entry or record made in the transfer account book of a financial institution, or placed it in custody, pursuant to Article 51-3, paragraph (1), and has, throughout the period from the day on which the entry or record was made or the custody was entrusted until the last day of that calculation period, had an entry or record made in the transfer account book of a financial institution, or kept it in custody: the amount calculated by multiplying the amount of the distribution of proceeds corresponding to that calculation period by the number of days in the period during which the entry or record has been made or the custody has been entrusted, and dividing the product by the number of days in that calculation period.

The beneficial interests specified by Cabinet Order prescribed in Article 11, paragraph (3) (Nontaxability of Public Corporations and Charitable Trusts) of the Act are the following beneficial interests:

a beneficial interest in a Loan Trust;

a beneficial interest in a Bond Investment Trust;

a beneficial interest in a Bond-Based Investment Trust;

a bond-type beneficial interest prescribed in Article 6-3, item (iv) (Application of This Act to Trust Corporations) of the Act.

The method specified by Cabinet Order prescribed in Article 11, paragraph (3) (Nontaxability of Public Corporations and Charitable Trusts) of the Act is, for each category of public and corporate bonds, etc. listed in the following items for which a public corporation, etc. or the trustee of a public interest trust, etc. seeks to receive the application of Article 11, paragraphs (1) and (2) of the Act with respect to the interest and similar income (meaning the interest and similar income prescribed in Article 11, paragraph (3) of the Act; the same applies in the following Article) on the public and corporate bonds, etc. prescribed in Article 11, paragraph (3) of the Act (hereinafter in this paragraph, the following paragraph, and the following Article referred to as "public and corporate bonds, etc.") that it owns or that belong to the trust property of the public interest trust, etc., the method specified in the relevant item.

public and corporate bonds and the beneficial interests listed in the items of the preceding Article (excluding those listed in the following item through item (iv)): the method of having an entry or record made in the transfer account book of a financial institution pertaining to the business office or similar place of a financial institution (meaning the business office, office, or other similar place of a person listed in Article 32, items (i), (iv), and (v) (Scope of Financial Institutions, etc.); the same applies hereinafter in this paragraph and in items (i) and (iv) of the following paragraph);

corporate bonds (meaning corporate bonds prescribed in Article 2, paragraph (1), item (ix) (Definitions) of the Act that fall under the rights prescribed in Article 29-2, paragraph (1), item (viii) (Application for Registration) of the Financial Instruments and Exchange Act; the same applies hereinafter in this item and in item (ii) of the following paragraph): the method of placing them in custody, by a specified management method (meaning a method that satisfies requirements prescribed by the Commissioner of the Financial Services Agency, such as imposing restrictions on the transfer of those corporate bonds), with a financial instruments business operator or similar institution (meaning a financial instruments business operator prescribed in Article 2, paragraph (9) (Definitions) of that Act (limited to a person that conducts type-I financial instruments business prescribed in Article 28, paragraph (1) (General Provisions) of that Act) or a registered financial institution prescribed in Article 2, paragraph (11) of that Act; the same applies in item (ii) of the following paragraph);

public and corporate bonds and the beneficial interests listed in item (ii) or (iii) of the preceding Article that are acquired from an Investment Trust management company (meaning an Investment Trust management company prescribed in Article 2, paragraph (11) (Definitions) of the Act on Investment Trusts and Investment Corporations; the same applies in item (iii) of the following paragraph) (excluding those listed in the preceding item): the method of having an entry or record made in the transfer account book of a financial institution through the business office of that Investment Trust management company that has brokered the transfer;

long-term credit bank debentures under Article 8 (Issuance of Long-Term Credit Bank Debentures) of the Long Term Credit Bank Act and other public and corporate bonds, etc. specified by Ministry of Finance Order, and beneficiary certificates in registered form of Loan Trusts and Bond-Based Investment Trusts Under Public Offering (limited to Investment Trusts not managed under instructions from the settlor prescribed in Article 2, paragraph (2) of the Act on Investment Trusts and Investment Corporations) (excluding those listed in item (ii)): the method of having an entry or record made in the transfer account book of a financial institution pertaining to the business office or similar place of a financial institution, or the method of having them kept at the business office or similar place of a financial institution.

The business offices or similar places (meaning business offices, offices, or other places equivalent to these; the same applies in item (ii)) listed in the following items (hereinafter in the following Article referred to as the "office of a financial institution or similar body") must, for the public and corporate bonds, etc. specified in the relevant item, keep books, set up an account for each person who has had an entry or record made or has placed the bonds in custody, and enter or record the matters specified by Ministry of Finance Order.

the business office or similar place of a financial institution set forth in item (i) of the preceding paragraph: the public and corporate bonds, etc. for which an entry or record has been made in the transfer account book of a financial institution set forth in that item;

the business office or similar place of a financial instruments business operator or similar institution set forth in item (ii) of the preceding paragraph: the corporate bonds for which custody has been accepted as set forth in that item;

the business office of the Investment Trust management company set forth in item (iii) of the preceding paragraph: the public and corporate bonds, etc. for which an entry or record has been made in the transfer account book of a financial institution set forth in that item;

the business office or similar place of a financial institution set forth in item (iv) of the preceding paragraph: the public and corporate bonds, etc. for which an entry or record has been made in the transfer account book of a financial institution, or for which custody has been accepted, as set forth in that item.

When the Commissioner of the Financial Services Agency has specified requirements pursuant to paragraph (1), item (ii), the Commissioner is to give public notice thereof.

In addition to what is provided for in paragraphs (1) and (2), necessary matters concerning the retention of the books set forth in paragraph (2) are specified by Ministry of Finance Order.

Where a public corporation, etc. or the trustee of a public interest trust, etc. seeks to receive the application of Article 11, paragraphs (1) and (2) (Nontaxability of Public Corporations and Charitable Trusts) of the Act with respect to the interest and similar income on public and corporate bonds, etc. that it is to be paid, it must, by the day preceding the day on which it is to be paid the interest and similar income on those public and corporate bonds, etc., submit the return form prescribed in Article 11, paragraph (3) of the Act, through the office of a financial institution or similar body and the payer (meaning the payer prescribed in Article 11, paragraph (3) of the Act; the same applies hereinafter in this paragraph and paragraph (6)), to the competent district director with jurisdiction over the place for tax payment of that payer for that interest and similar income under Article 17 (Locality for Paying Over Withholding Tax) of the Act (or, where a designation has been made under Article 18, paragraph (2) (Designation of Locality for Paying Over Taxes) of the Act, the place for tax payment so designated).

The head of the office of a financial institution or similar body set forth in the preceding paragraph must not accept the return form if the matters concerning the entry or record, custody, or brokering of transfer of Securities pertaining to the public and corporate bonds, etc. stated in the return form set forth in that paragraph differ from the matters concerning the entry or record, custody, or brokering of transfer of Securities pertaining to those public and corporate bonds, etc. stated in the books set forth in paragraph (2) of the preceding Article.

In the case referred to in paragraph (1), when the return form set forth in that paragraph is accepted by the office of a financial institution or similar body set forth in that paragraph, that return form is deemed to have been submitted to the district director set forth in that paragraph on the day on which it was accepted.

A public corporation, etc. or the trustee of a public interest trust, etc. set forth in paragraph (1) may, in lieu of submitting a return form pursuant to that paragraph, provide the matters to be stated in that return form to the office of a financial institution or similar body set forth in that paragraph by electronic or magnetic means (meaning the electronic or magnetic means prescribed in Article 11, paragraph (4) of the Act; the same applies in paragraph (6)). In this case, that public corporation, etc. or the trustee of that public interest trust, etc. is deemed to have submitted that return form to that office of a financial institution or similar body.

With respect to the application of paragraph (3) in the case where Article 11, paragraph (4) of the Act or the preceding paragraph applies, the phrase "the return form set forth in that paragraph is" in that paragraph is deemed to be replaced with "the matters to be stated in the return form set forth in that paragraph are", the phrase "accepted by" with "provided to", and the phrase "the day on which it was accepted" with "the day on which they were provided".

The head of the office of a financial institution or similar body that has accepted the return form set forth in paragraph (1) may, in lieu of submitting a return form pursuant to that paragraph, provide the matters to be stated in that return form to the payer set forth in that paragraph by electronic or magnetic means. In this case, the head of that office of a financial institution or similar body is deemed to have submitted that return form to that payer.

The requirements specified by Cabinet Order prescribed in the row for federations of agricultural cooperatives in Appended Table 1 of the Act are that the articles of incorporation of the federation of agricultural cooperatives contain the following provisions:

a provision that the business conducted by the federation of agricultural cooperatives is limited to the business listed in Article 10, paragraph (1), item (xi) (Facilities Relating to Medical Care) of the Agricultural Co-operatives Act (including business incidental thereto), or that business and the business listed in item (xii) (Facilities Relating to the Welfare of the Elderly) of that paragraph (including business incidental thereto);

a provision that the federation of agricultural cooperatives is not to pay dividends of surplus (limited to those on capital contributions);

a provision that, when the federation of agricultural cooperatives is dissolved, its residual assets are to revert to the State, a local government, or another federation of agricultural cooperatives that conducts the business prescribed in item (i).

A federation of agricultural cooperatives that seeks to receive the designation prescribed in the row for federations of agricultural cooperatives in Appended Table 1 of the Act must attach a copy of its articles of incorporation and other documents specified by Ministry of Finance Order to a written application stating its name and the location of its principal office, the name and location of the hospitals or clinics it establishes, and other matters specified by Ministry of Finance Order, and submit it to the Minister of Finance.

When the Minister of Finance has designated a federation of agricultural cooperatives pursuant to the row for federations of agricultural cooperatives in Appended Table 1 of the Act, the Minister is to give public notice thereof.