Order for Enforcement of the Income Tax Act

The amount calculated as specified by Cabinet Order prescribed in Article 139, paragraph (2) (Refunding of Prepaid Taxes) of the Act is the remainder obtained by deducting the amount listed in item (ii) from the amount listed in item (i).

the sum of the amounts of delinquent tax paid on the tax prepayment, etc. prescribed in Article 268, paragraph (1), item (i) (Order of Appropriation of Income Tax to Be Refunded) for the year pertaining to the Tax Return prescribed in Article 139, paragraph (1) of the Act (hereinafter in this Article referred to as "tax prepayment, etc.") (excluding, where any of that delinquent tax has already become refundable under the provisions of Article 139, paragraph (2) or Article 160, paragraph (2) (Refunding of Prepaid Taxes Based on Reassessment or Similar Decision) of the Act, the amount of the delinquent tax that has become refundable);

the sum of the amounts of delinquent tax calculated pursuant to the provisions of laws relating to national taxes on each tax prepayment, etc. obtained sequentially, in the order specified below, out of that tax prepayment, etc. (excluding the amount of the portion to be appropriated by a refund under Article 139, paragraph (1) or Article 160, paragraph (1) of the Act) until reaching the amount listed in Article 120, paragraph (1), item (iii) (Filing an Income Tax Return) of the Act stated in the Tax Return referred to in the preceding item (where there is an amount of tax withheld prescribed in item (iv) of that paragraph, the amount listed in that item, and where there is income tax to be appropriated under Article 268, paragraph (2), item (i), the amount obtained by adding that amount of income tax).

among the tax prepayment, etc., for those with different statutory payment due dates prescribed in Article 2, item (viii) (Definitions) of the Act on General Rules for National Taxes (hereinafter in this Article referred to as "statutory payment due date"), the one with the earlier statutory payment due date takes priority;

among the tax prepayment, etc. with the same statutory payment due date, for those with different dates of finalization, the one with the earlier date of finalization takes priority;

among the tax prepayment, etc. with the same statutory payment due date and date of finalization, for those with different dates of payment, the one with the earlier date of payment takes priority.

Where calculating the amount listed in Article 140, paragraph (1), item (ii) (Claim to Be Issued a Refund Based on Carryback of Net Loss) or Article 141, paragraph (1), item (ii) (Claim by an Heir to Be Issued a Refund Based on Carryback of Net Loss) of the Act, if all or part of the amount of a Net Loss is to be deducted from the taxable gross income, taxable retirement income, and taxable timber income for the year preceding the relevant year, the following apply.

if, within the amount of the Net Loss to be deducted, there is an amount of the portion of loss arising in the calculation of the gross income prescribed in Article 201, paragraph (1), item (ii), (a) (Deduction for Carryover of Net Loss), that amount is first to be deducted from the taxable gross income for the year preceding the relevant year;

if, within the amount of the Net Loss to be deducted, there is an amount of the portion of loss arising in the calculation of the amount of timber income prescribed in Article 201, paragraph (1), item (ii), (b), that amount is first to be deducted from the taxable timber income for the year preceding the relevant year;

the amount of the portion of loss arising in the calculation of gross income that cannot be fully deducted even after the deduction under item (i) is to be deducted from the taxable timber income for the year preceding the relevant year (where the deduction under the preceding item is made, the amount after that deduction), and then from the taxable retirement income;

the amount of the portion of loss arising in the calculation of the amount of timber income that cannot be fully deducted even after the deduction under item (ii) is to be deducted from the taxable gross income for the year preceding the relevant year (where the deduction under item (i) is made, the amount after that deduction), and then from the taxable retirement income (where the deduction under the preceding item is made, the amount after that deduction);

in the case of item (i) or (iii), if the amount of the portion of loss arising in the calculation of gross income includes both the amount of loss from Fluctuating Income prescribed in Article 199 (Aggregation of Profits and Losses for Loss from Fluctuating Income, etc.) and the amount of other losses, the amount of other losses is deducted first, and then the amount of loss from Fluctuating Income is deducted;

in the case of item (i) or (iv), if Article 90, paragraph (1) (Averaging Taxation on Fluctuating Income and Ad Hoc Income) of the Act applied in the year preceding the relevant year, then, of the amount of the Net Loss to be deducted from the taxable gross income for that year, the amount of loss from Fluctuating Income prescribed in Article 199 is first to be deducted from the amount subject to averaging taxation prescribed in Article 90, paragraph (3) of the Act for that year, and the amount of the portion of loss arising in the calculation of the amount of Income in Each Class other than that Fluctuating Income is first to be deducted from the portion of the taxable gross income for that year other than that amount subject to averaging taxation.

Where the preceding paragraph applies, if the Net Loss arising in that year includes both the Net Loss from Disaster damage to business assets prescribed in Article 70-2, paragraph (4), item (i) (Special Provisions on Deduction for Carryover of Net Loss Related to a Specified Extraordinary Disaster) of the Act and the amount of Net Loss other than that Net Loss from Disaster damage to business assets (excluding that falling under the Net Loss in the year of a specified extraordinary Disaster prescribed in paragraph (1) of that Article), the deduction under the preceding paragraph is made on the basis that the amount of Net Loss forming the basis for calculating the amount to be refunded under Article 142, paragraph (2) (Procedures for Issuing Refunds Based on Carryback of Net Loss) of the Act consists of amounts of Net Loss taken in sequence, starting from the amount of Net Loss other than that Net Loss from Disaster damage to business assets.

The events specified by Cabinet Order prescribed in Article 140, paragraph (5) (Claim for a Refund Based on Carryback of Net Loss upon Transfer of the Whole of a Business, etc.) of the Act are the suspension of the whole of the business for a considerable period or the transfer of an important part of it, which are found to make it difficult, by reason of the occurrence of those events, to receive, with respect to the amount of Net Loss prescribed in that paragraph, the application of Article 70, paragraph (1) (Deduction for Carryover of Net Loss) of the Act.

The amount for which a refund may be claimed under the provisions of Article 140, paragraph (5) or Article 141, paragraph (4) (Claim by an Heir to Be Issued a Refund Based on Carryback of Net Loss) of the Act is the amount calculated, on the basis of the taxable gross income, taxable retirement income and taxable timber income for the year two years before the year that includes the date on which the event prescribed in those provisions occurred, the amount of income tax calculated for those by applying the provisions of Part II, Chapter III, Section 1 (Tax Rates) of the Act, and the amount of Net Loss prescribed in those Articles that arose in the year preceding the year that includes that date, in accordance with the provisions of Article 140, paragraphs (1) through (3) and Article 141, paragraphs (1) through (3) of the Act and the preceding Article. In this case, if the provisions of Article 140, paragraph (1) or Article 141, paragraph (1) of the Act have already been applied to the income tax for that year two years before, the amount obtained by deducting the amount of Net Loss pertaining to that application from the amount equivalent to the taxable gross income, taxable retirement income and taxable timber income for that year two years before is deemed to be that taxable gross income, taxable retirement income and taxable timber income, and the amount obtained by deducting the amount refunded through that application from the amount equivalent to the amount of income tax for that year two years before is deemed to be that amount of income tax.

Where a claim for a refund is made under the provisions of Article 141, paragraph (1) or (4) (Claim by an Heir to Be Issued a Refund Based on Carryback of Net Loss) of the Act, if there are two or more heirs, the claim for a refund under the provisions of Article 142, paragraph (1) (Procedures for Issuing Refunds Based on Carryback of Net Loss) of the Act pertaining to that claim must be submitted by each heir in a single document jointly signed; provided, however, that this does not preclude each heir from submitting it separately with the names of the other heirs appended.

An heir who has submitted the claim for a refund referred to in the preceding paragraph by the method set out in the proviso to that paragraph must, without delay, notify the other heirs of the gist of the matters stated in that claim for a refund.