Order for Enforcement of the Income Tax Act

Assets specified by Cabinet Order as prescribed in Article 2, paragraph (1), item (xix) (Definitions) of the Act are, among assets other than Inventory, Securities, and Deferred Assets, the following (excluding those whose value does not decrease with the passage of time):

buildings and associated facilities (meaning heating and cooling equipment, lighting equipment, ventilation equipment, elevators, and other facilities associated with a building);

structures (meaning docks, bridges, quays, piers, tracks, reservoirs, mine shafts, chimneys, and other civil engineering facilities or works fixed to land);

machinery and equipment;

a vessel;

aircraft;

vehicles and transport equipment;

tools, appliances, and fixtures (including living things used for ornamental, entertainment, or similar purposes);

the following intangible Fixed Assets:

mining rights (including mining leasehold rights, quarrying rights, and other rights to excavate or collect earth and stone (excluding the intangible Fixed Assets listed in (b)));

storage rights (including trial drilling rights prescribed in Article 2, paragraph (8) (Definitions) of the Act on Carbon Dioxide Storage Business (Act No. 38 of 2024));

fishing rights (including rights of entry to fisheries);

dam use rights;

water rights;

patent rights;

utility model rights;

design rights;

trademark rights;

software;

breeder's rights;

tree harvesting rights;

fishing port water surface facility operating rights;

goodwill;

exclusive siding use rights (meaning the right to exclusively use a railway or track by bearing, for a person that operates a railway business prescribed in Article 2, paragraph (1) (Definitions) of the Railway Business Act (Act No. 92 of 1986) or a transport business conducted by laying a track prescribed in Article 1, paragraph (1) (Scope of Application of the Act on Rail Tracks) of the Act on Rail Tracks (Act No. 76 of 1921) (hereinafter in this item referred to as a "railway business operator, etc."), the costs required for laying that railway or track);

railway-track connecting passage facility use rights (meaning the right to use facilities, where a railway business operator, etc. has borne, for another railway business operator, etc., the Japan Railway Construction, Transport and Technology Agency, the Japan Expressway Holding and Debt Repayment Agency, or the State or a local government, the costs required for providing bridges, underground passages, and other facilities necessary for connection with the railways or tracks of that other railway business operator, etc., the Japan Railway Construction, Transport and Technology Agency, or the Japan Expressway Holding and Debt Repayment Agency, or facilities necessary for laying a railway or track);

Right to use electricity or gas supply facilities (meaning the right to bear the expenses required for establishing electricity or gas supply facilities (excluding those used for the Specified Gas Pipeline Service Business prescribed in Article 2, paragraph (7) of the Gas Business Act (Act No. 51 of 1954)) for a person who operates the General Power Transmission and Distribution Business prescribed in Article 2, paragraph (1), item (viii) (Definitions) of the Electricity Business Act (Act No. 170 of 1964), the Power Transmission Business prescribed in item (x) of that paragraph, the Power Distribution Business prescribed in item (xi)-2 of that paragraph, or the Power Generation Business prescribed in item (xiv) of that paragraph, or the General Gas Pipeline Service Business prescribed in Article 2, paragraph (5) (Definitions) of the Gas Business Act, and to receive the supply of electricity or gas by using those facilities);

Right to use waterworks facilities (meaning the right to bear the expenses required for establishing waterworks facilities for a water supply utility prescribed in Article 3, paragraph (5) (Definitions of Terms) of the Water Supply Act (Act No. 177 of 1957), and to receive the supply of water by using those facilities);

Right to use industrial waterworks facilities (meaning the right to bear the expenses required for establishing industrial waterworks facilities for an industrial water supply business operator prescribed in Article 2, paragraph (5) (Definitions) of the Industrial Water Supply Business Act (Act No. 84 of 1958), and to receive the supply of industrial water by using those facilities);

Right to use telecommunications facilities (meaning the right to bear the expenses required for installing, for a telecommunications carrier that installs the telecommunications circuit facilities prescribed in Article 9, item (i) (Registration of Telecommunications Business) of the Telecommunications Business Act (Act No. 86 of 1984) and is prescribed in Article 2, item (v) (Definitions) of that Act, for use in the telecommunications business prescribed in item (iv) of that Article, the telecommunications facilities prescribed in item (ii) of that Article, and to receive the provision of the telecommunications services prescribed in item (iii) of that Article by using those facilities (excluding telephone subscription rights and rights equivalent thereto));

The following living organisms (excluding those that fall under item (vii)):

Cattle, horses, pigs, sheep, and goats;

Citrus trees, apple trees, grape vines, pear trees, peach trees, cherry trees, loquat trees, chestnut trees, plum trees (ume), persimmon trees, apricot trees, plum trees (sumomo), fig trees, kiwifruit trees, blueberry bushes, and pineapples;

Tea plants, olive trees, camellia trees, mulberry trees, kori-yanagi (wicker willow), mitsumata (paper bush), kozo (paper mulberry), moso bamboo, asparagus, ramie, maoran, and hops.

The expenses specified by Cabinet Order prescribed in Article 2, paragraph (1), item (xx) (Meaning of Deferred Asset) of the Act are, among the expenses spent by an individual (excluding expenses that are to be regarded as the amount required for the acquisition of assets and prepaid expenses), the following:

Business start-up expenses (meaning expenses specially spent for start-up preparation until the commencement of a business that gives rise to real property income, business income, or timber income);

Development expenses (meaning expenses specially spent for the adoption of new technology or a new business organization, the development of resources, or the opening of markets);

In addition to what is listed in the preceding two items, the following expenses, the effect of which extends for one year or more from the date of the expenditure:

Expenses spent for the installation or improvement of public facilities or shared facilities from which one receives benefit;

Key money, eviction fees, and other expenses spent for leasing or using assets;

Key money and other expenses spent for receiving the provision of services;

Expenses arising from the gifting of assets used for the advertising of products, etc.;

In addition to the expenses listed in (a) through (d), expenses spent for one to receive benefit.

The prepaid expenses prescribed in the preceding paragraph means, among the expenses spent by an individual for continuously receiving the provision of services under a certain contract, those corresponding to services not yet provided as of December 31 of the year in which the date of the expenditure falls (in the case of death or Absence From Japan in the middle of the year, at the time of that death or Absence From Japan).

The income specified by Cabinet Order prescribed in Article 2, paragraph (1), item (xxiii) (Meaning of Fluctuating Income) of the Act is income arising from fishing or the harvesting of laver, income arising from the farming of yellowtail, red sea bream, flounder, oysters, eels, scallops, or pearls (including pearl oysters), income pertaining to remuneration for manuscripts or musical compositions, or income pertaining to royalties for copyrights.

The income specified by Cabinet Order prescribed in Article 2, paragraph (1), item (xxiv) (Meaning of Ad Hoc Income) of the Act is the following income and other income similar thereto:

Income pertaining to contract money received in a lump sum by a professional baseball player or other person who provides services exclusively for a certain person by promising, for a period of three years or more, to provide services for that certain person or not to provide services for any person other than that person, where the amount of that contract money is equal to or more than twice the annual amount of the remuneration for the provision of services under that contract;

Income pertaining to a right fee, down payment, or other consideration received in a lump sum by a person who holds real property, rights existing on real property, vessels, aircraft, quarrying rights, mining rights, fishery rights, or industrial property rights or other rights related to technology, or production methods based on special technology, or anything equivalent thereto, by promising, for a period of three years or more, to allow another person (including, where that person is a Nonresident, the place of business or similar place prescribed in Article 161, paragraph (1), item (i) (Domestic Source Income) of the Act) to use those assets (including establishing superficies, mining lease rights, or other rights pertaining to those assets), where the amount of that consideration is equal to or more than twice the annual amount of the royalties for the use of those assets under that contract (excluding income that falls under capital gains);

Income pertaining to compensation received by a person who has come to suspend, convert, or abolish all or part of operations at a certain place, as compensation for real property income, business income, or miscellaneous income for a period of three years or more pertaining to those operations due to that suspension, conversion, or abolition;

In addition to what is listed in the preceding item, income pertaining to compensation received by a person who has suffered damage from mining damage or other Disaster with respect to all or part of assets used for operations, as compensation for real property income, business income, or miscellaneous income for a period of three years or more pertaining to those operations due to having suffered that damage.

The Disasters specified by Cabinet Order prescribed in Article 2, paragraph (1), item (xxvii) (Meaning of Disaster) of the Act are Disasters caused by abnormal changes in natural phenomena such as cold damage, snow damage, drought damage, lightning strikes, and volcanic eruptions, abnormal Disasters caused by human action such as mining damage and explosions of explosives, and abnormal Disasters caused by insects, noxious animals, and other living creatures.