Supplementary Provisions, Article 3Transitional Measures Concerning Nontaxability of Interest Income and Similar Income from Small Deposits

①The provisions of Part I, Chapter II, Section 4 of the New Order apply to the Deposits and Savings, Jointly Managed Trusts or Securities prescribed in Article 10, paragraph (1) of the New Act (hereinafter referred to as "deposits and similar savings" in this Article) for which deposit, entrustment or purchase (hereinafter referred to as "placement" in this Article) is made on or after the Effective Date.

②Where deposits and similar savings that are deemed, pursuant to the provisions of Article 28, paragraph (3) of the Supplementary Provisions of the Amending Act, to have been the subject of placement in accordance with the requirements of Article 10 of the New Act are based on an ordinary deposit contract, etc. prescribed in Article 35, paragraph (1) of the Order for Enforcement of the Income Tax Act prior to amendment by the Cabinet Order Partially Amending the Order for Enforcement of the Income Tax Act (Cabinet Order No. 314 of 1981; hereinafter referred to as the "1981 Amending Order" in this paragraph) (hereinafter referred to as the "Former Order for Enforcement of the Income Tax Act"), which is to remain in force pursuant to the provisions of Article 3, paragraph (2) of the Supplementary Provisions of the 1981 Amending Order prior to amendment by the provisions of Article 11 of the Supplementary Provisions, the application to exempt savings from taxation under Article 35, paragraph (1) of the Former Order for Enforcement of the Income Tax Act pertaining to those deposits and similar savings is deemed to be an application to exempt savings from taxation under Article 35, paragraph (1) of the New Order stating the classification of deposits and similar savings prescribed in Article 35, paragraph (1) of the New Order and the limit on the current balance of those deposits and similar savings (where an application to exempt savings from taxation under Article 35, paragraph (2) of the Former Order for Enforcement of the Income Tax Act has been submitted, the limit after the change).

③With regard to the retention of the application forms prescribed in Article 48, paragraph (1) of the Former Order for Enforcement of the Income Tax Act, the books prescribed in paragraph (3) of that Article, the copies of the return forms prescribed in paragraph (4) of that Article, and the documents and books prescribed in paragraph (5) of that Article, which were received or prepared before the Effective Date and pertain to the former Deposits and Savings prescribed in Article 28, paragraph (3) of the Supplementary Provisions of the Amending Act, the provisions then in force continue to govern.

④A return form for the acceptance of deposits at the place of employment prescribed in Article 49, paragraph (1) of the Former Order for Enforcement of the Income Tax Act that was submitted before the Effective Date (excluding one for which a notification has been made, pursuant to paragraph (2) of that Article, to the effect that savings falling under Deposits and Savings will no longer be managed) is deemed to be the written notice under Article 50, paragraph (1) of the New Order that was submitted on the Effective Date pursuant to that paragraph.

⑤The cases specified by Cabinet Order prescribed in Article 28, paragraph (5) of the Supplementary Provisions of the Amending Act are cases where, at the business office of a financial institution or other such place prescribed in Article 10, paragraph (1) of the New Act (hereinafter referred to as the "business office of a financial institution or other such place" in this Article) through which the former statement of tax-exempt savings prescribed in Article 28, paragraph (5) of the Supplementary Provisions of the Amending Act (hereinafter referred to as the "former statement of tax-exempt savings" in this Article) was submitted, placement is made on or after the Effective Date of deposits and similar savings for which application of Article 10, paragraph (1) of the New Act is sought and the case falls under any of the following items, and cases where, on or after the Effective Date, the return form under Article 10, paragraph (4) of the New Act is submitted with regard to that former statement of tax-exempt savings.

⑥An individual for whom the placement of deposits and similar savings prescribed in the preceding paragraph, made on or after the Effective Date at the business office of a financial institution or other such place through which the former statement of tax-exempt savings was submitted, has come to fall under the case set forth in item (iii) or item (iv) of that paragraph must, except where, during the period from the day of that placement to December 31, 1990, the individual has submitted the statement of tax-exempt savings under Article 28, paragraph (5) of the Supplementary Provisions of the Amending Act with regard to that former statement of tax-exempt savings pursuant to that paragraph, and except in other cases specified by Ministry of Finance Order, newly submit a statement of tax-exempt savings under Article 10, paragraph (3) of the New Act as provided in that paragraph and paragraph (5) of that Article by the earlier of January 31, 1991 and the day on which, on or after January 1 of that year, the individual first makes placement of deposits and similar savings for which application of Article 10, paragraph (1) of the New Act is sought.

⑦The provisions of the second sentence of Article 28, paragraph (5) of the Supplementary Provisions of the Amending Act apply mutatis mutandis to the submission of the statement of tax-exempt savings referred to in the preceding paragraph. In this case, the phrase "the day on which that placement is made" in Article 28, paragraph (5) of the Supplementary Provisions of the Amending Act is deemed to be replaced with "the submission deadline prescribed in Article 3, paragraph (6) of the Supplementary Provisions of the Cabinet Order Partially Amending the Order for Enforcement of the Income Tax Act and the Order for Enforcement of the Act on Special Measures Concerning Taxation (Cabinet Order No. 124 of 1985)".

⑧Where a statement of tax-exempt savings is submitted pursuant to the provisions of Article 28, paragraph (5) of the Supplementary Provisions of the Amending Act or paragraph (6) of this Article, and the maximum limitation in the former statement of tax-exempt savings (hereinafter referred to as the "former maximum amount" in this paragraph and the following paragraph) has a fraction of less than 10,000 yen (including where the former maximum amount is less than 10,000 yen), the maximum limitation set forth in Article 10, paragraph (3), item (iii) of the New Act to be stated in that statement of tax-exempt savings is to be the amount after rounding up or rounding down that fraction, notwithstanding Article 28, paragraph (5) of the Supplementary Provisions of the Amending Act (including as applied mutatis mutandis pursuant to the preceding paragraph). In this case, where the sum of that maximum limitation and the maximum limitation set forth in Article 10, paragraph (3), item (iv) of the New Act to be stated in that statement of tax-exempt savings comes to exceed 3,000,000 yen, that statement of tax-exempt savings cannot be submitted.

⑨In the case referred to in the preceding paragraph, when the statement of tax-exempt savings referred to in that paragraph is submitted, it is deemed that a return form under Article 10, paragraph (4) of the New Act changing the former maximum amount to the maximum limitation stated in that statement of tax-exempt savings has been submitted.

⑩When the business office of a financial institution or other such place receives a statement of tax-exempt savings newly submitted pursuant to the provisions of Article 28, paragraph (5) of the Supplementary Provisions of the Amending Act or paragraph (6) of this Article and prescribed in those provisions, it must state in that statement that it was submitted pursuant to those provisions and the date of submission of the former statement of tax-exempt savings pertaining to that statement.

⑪With regard to the application of Article 47-2 of the New Order to the statement of tax-exempt savings referred to in the preceding paragraph, the phrase "the 10th of the month following the month" in that Article is deemed to be replaced with "the last day of the second month following the month".