Article 72-24-10Deduction and Refund of the Enterprise Tax Amount Accompanying a Reassessment in the Case of an Overstated Return Based on Fictitious Accounting

①Where a prefectural governor has made a reassessment of the value-added levy, capital levy, income levy or revenue levy for a business year that began before the first day of each business year of a corporation that carries on business (including the business year of the merged corporation relating to a qualified merger (meaning a qualified merger prescribed in Article 2, item (xii)-8 of the Corporation Tax Act; the same applies hereinafter in this Section) carried out on or before the last day of that business year with that corporation as the merging corporation (meaning a corporation that has had assets and liabilities transferred to it by a merged corporation (meaning a corporation that has transferred its assets and liabilities through a merger; the same applies hereinafter in this Section) through a merger; the same applies hereinafter in this Section) that began before the date of that qualified merger (hereinafter in this paragraph referred to as the "business year of the acquired corporation")), and the following paragraph has applied to that reassessment, the enterprise tax paid on fictitious accounting prescribed in that paragraph relating to that reassessment (excluding the amount already to be refunded pursuant to paragraph (3) or (7) and the amount deducted pursuant to this paragraph) is to be deducted from the value-added levy amount, capital levy amount, income levy amount or revenue levy amount of that business year (limited to a business year ending on or after the day of that reassessment (or, where that reassessment was made, with respect to the value-added levy, capital levy, income levy or revenue levy for the business year of the acquired corporation, before the date of that qualified merger, the date of that qualified merger)).

②Where the value added, amount of stated capital, etc., income or revenues for each business year stated in a return submitted by a corporation that carries on business pursuant to Article 72-25, Article 72-28 or Article 72-29 exceeds the value added, amount of stated capital, etc., income or revenues that should have been the tax base for that business year, and part of the excess amount is based on fictitious accounting of facts, if the prefectural governor has made a reassessment of the value-added levy, capital levy, income levy or revenue levy for that business year (excluding the case where, with respect to that corporation, a fact listed in the items of the following paragraph or the items of paragraph (4) occurred between the last day of that business year and the day before the day of that reassessment, and the case where that fact occurred, with respect to the merging corporation relating to a qualified merger with that corporation as the merged corporation, between the date of that qualified merger and the day before the day of that reassessment), then, of the amount specified by Cabinet Order out of the amount paid as the value-added levy, capital levy, income levy or revenue levy for that business year, the amount of the part reduced by that reassessment that relates to the amount recorded through that fictitious accounting (hereinafter in this Article referred to as the "enterprise tax paid on fictitious accounting") is not to be refunded, and is not to be appropriated to the unpaid local government levies of that corporation, notwithstanding Articles 17, 17-2, 17-4 and 72-41-4, except for the amount that has come to be refunded under those provisions where the following paragraph or paragraph (7) applies.

③With respect to a corporation that carries on business to which the preceding paragraph has applied (where that corporation has been dissolved through a qualified merger, the merging corporation relating to that qualified merger; hereinafter in this Article referred to as an "applicable corporation"), where the deadline for filing a return under Article 72-25, Article 72-28 or Article 72-29 for the business year that includes the day on which five years elapse from the first day of the business year that includes the day of the reassessment referred to in that paragraph (or, where that reassessment was made before the date of the qualified merger with respect to the value-added levy, capital levy, income levy or revenue levy for each business year of the merged corporation relating to that qualified merger, the first day of the business year of that merged corporation that includes the day of that reassessment) (or, where a fact listed in the following items has occurred with respect to that applicable corporation between the day of that reassessment and the last day of the business year that includes the day on which those five years elapse, the deadline for filing specified in the relevant item) has arrived (or, where the return was not submitted by that deadline for filing, where that return was submitted after that deadline for filing, or a determination was made under Article 72-39, paragraph (2), Article 72-41, paragraph (2) or Article 72-41-2, paragraph (2) with respect to the value-added levy, capital levy, income levy or revenue levy for the business year relating to that return), the prefectural governor is to, as specified by Cabinet Order, refund to that applicable corporation the enterprise tax paid on fictitious accounting relating to that reassessment (excluding the amount already to be refunded pursuant to this paragraph or paragraph (7) and the amount deducted pursuant to paragraph (1)), or appropriate it to the unpaid local government levies of that applicable corporation.

④Where any of the following facts has occurred with respect to an applicable corporation, that applicable corporation may, within one year after the day on which that fact occurred, request the prefectural governor to refund the enterprise tax paid on fictitious accounting relating to its application (excluding the amount already to be refunded pursuant to the preceding paragraph or paragraph (7) and the amount deducted pursuant to paragraph (1); the same applies in paragraphs (6) and (7)).

⑤Where, in respect of a corporation that carries on business, a reassessment that reduces the value added, income or revenues for each business year of the corporation and that accompanies a reassessment made of the value-added levy, income levy or revenue levy for a business year of the corporation that ended before the first day of that each business year (including a reassessment made of the value-added levy, income levy or revenue levy for a business year of the merged corporation relating to a qualified merger with that corporation as the merging corporation that ended before the date of that qualified merger; hereinafter in this paragraph referred to as the "original reassessment") (hereinafter in this paragraph referred to as a "consequential reassessment") has been made, if, of the value added, income or revenues of the portion reduced by that consequential reassessment, there is any relating to an amount that was recorded through fictitious accounting of the facts in the business year relating to that original reassessment, the preceding paragraphs apply deeming that amount to be an amount based on fictitious accounting by that corporation in that each business year.

⑥An applicable corporation that intends to claim a refund under paragraph (4) must submit to the prefectural governor a written request stating the enterprise tax paid on fictitious accounting for which it intends to receive the refund, the basis of its calculation, and other particulars specified by Order of the Ministry of Internal Affairs and Communications.

⑦When the written request set forth in the preceding paragraph has been submitted, the prefectural governor is to investigate the facts pertaining to the request and other necessary matters and, based on the results of that investigation, as provided by Cabinet Order, refund the enterprise tax paid on fictitious accounting to the applicable corporation that made the request, or appropriate it to the local government levies unpaid by that applicable corporation, or notify the corporation in writing that there are no grounds for the request.