Article 132Deferring Payment of Income Taxes on Assets Transferred on a Deferred-Payment Basis

①If a Resident transfers assets generating timber income or capital gains on a deferred-payment basis and the following requirements are all met, the district tax office director may permit a deferment of payment for all or a part of the income taxes payable pursuant to the provisions of Article 128 (Payment upon Filing) or Article 129 (Payment upon Filing in the Event of the Taxpayer's Death), as indicated in a return as prescribed in item (i) (or for all or a part of the taxes on assets transferred on a deferred-payment basis, if the taxes on assets transferred on a deferred-payment basis are less than the income taxes payable pursuant to the provisions of Article 128) for up to five years, at the application of the Resident (or the Resident's heir):

②Before permitting a tax payment deferment pursuant to the provisions of the preceding paragraph, the district director must collect collateral equivalent to the amount of income taxes whose payment is being deferred; provided, however, that this does not apply if the amount of income taxes whose payment is being deferred is one million yen or less and the deferment period is three years or less, or if that period is three months or less.

③A transfer on a deferred-payment basis as prescribed in paragraph (1) means a transfer undertaken under conditions meeting the following requirements based on a contract that defines those conditions:

④The taxes on assets transferred on a deferred-payment basis as prescribed in paragraph (1) means the part of the income taxes set forth in Article 120, paragraph (1), item (iii) that is indicated in a return as prescribed in paragraph (1), item (i) and which is calculated pursuant to Cabinet Order as the part of the taxes on timber income or capital gains from the sum total of the installment payments connected with the deferred-payment transfer whose payment deadline as defined in the contract for the deferred-payment transfer falls in or after the year following the relevant year (this excludes any installment payment already made during the relevant year).