①Where a corporation that files a blue return and that falls under the category of a qualified farmland-owning corporation prescribed in Article 2, paragraph (3) of the Cropland Act that has obtained the certification under Article 12, paragraph (1) of the Act on Promotion of Improvement of Agricultural Management Foundation for a farm management improvement plan prescribed in that paragraph (referred to in paragraph (3), item (i) as a "certified qualified farmland-owning corporation") (limited to one specified by Order of the Ministry of Finance as a person who takes charge of agriculture in the area of the regional plan prescribed in Article 19, paragraph (1) of the Act on Promotion of Improvement of Agricultural Management Foundation), within the designated period in each business year that includes a day within the period from April 1, 2007 to March 31, 2027 (hereinafter referred to as the "designated period" in this paragraph) (excluding the business year that includes the day of dissolution and each business year during liquidation), has received a grant prescribed in Article 3, paragraph (1) or Article 4, paragraph (1) of the Act on Payment of Grants to Farmers for Purpose of Stabilization of Farming Management or any other grant or subsidy specified by Order of the Ministry of Finance as being similar thereto (referred to in item (i) as "grants, etc."), if, in preparation for the expenditure of expenses required for strengthening the farm management base (meaning expanding the scale of farm management referred to in Article 12, paragraph (2), item (ii) of that Act or rationalizing the production methods referred to in that item; the same applies in item (i)) carried out in accordance with the certified plan prescribed in Article 13, paragraph (2) of the Act on Promotion of Improvement of Agricultural Management Foundation (referred to in paragraph (3), item (ii), (a) and (b) as the "certified plan"), the corporation sets aside as a reserve for strengthening the farm management base, through accounting as an expense or loss, an amount not exceeding the lesser of the following amounts (including the case where it sets aside the reserve for strengthening the farm management base through the method of setting it aside as a reserve through the appropriation of surplus by the day on which the settlement of accounts for that business year is finalized), the amount so set aside is included in deductible expenses in calculating the amount of income for that business year.

②Where, as of the date of the end of each business year of a corporation to which the provisions of the preceding paragraph have been applied, the amount of the reserve for strengthening the farm management base carried over from the preceding business year (where there are amounts that have been included, or are to be included, in gross profit by that day pursuant to the provisions of the following paragraph, or amounts that were included in gross profit by the date of the end of the preceding business year pursuant to the provisions of this paragraph, the amount obtained by deducting those amounts; hereinafter the same applies in this Article) includes an amount for which five years have elapsed from the day following the date of the end of the business year in which it was set aside (referred to as the "business year of accumulation" in the following paragraph), the amount of the reserve for strengthening the farm management base for which those five years have elapsed is included in gross profit in calculating the amount of income for the business year that includes the day on which those five years elapsed.

③Where a corporation that has set aside the reserve for strengthening the farm management base referred to in paragraph (1) comes to fall under any of the cases listed in the following items (excluding the case where a qualified merger in which the corporation is the merged corporation has been carried out), the amount equivalent to the amount specified in that item is included in gross profit in calculating the amount of income for the business year that includes the day on which the corporation came to fall under that case (in the case listed in item (iii), the business year that includes the day preceding the day of the merger). In this case, where the corporation falls under the case listed in item (ii) or item (v), the amounts into which the amount of the reserve for strengthening the farm management base prescribed in those items is divided by the business year of accumulation in which each was set aside are to be included in gross profit in order beginning with the amount with the earliest business year of accumulation.

④Where a corporation that has set aside the reserve for strengthening the farm management base referred to in paragraph (1) has the approval for filing blue returns revoked, or has submitted a written notification to the effect that it will discontinue filing blue returns, the amount of the reserve for strengthening the farm management base on the day on which the fact giving rise to the revocation of the approval occurred (or, in the case falling under any of the cases listed in the following items, the day specified in that item) or on the day on which the written notification was submitted (or, if the day on which the written notification was submitted falls after the date of the end of the business year in which the corporation discontinued filing blue returns, on that date) is included in gross profit in calculating the amount of income for the business year that includes that day. In this case, the provisions of the preceding two paragraphs and paragraph (6) do not apply.

⑤The provisions of Article 56, paragraph (6) apply mutatis mutandis where the provisions of paragraph (1) are applied.

⑥The provisions of Article 55, paragraphs (10) and (11) and the first sentence of paragraph (12) apply mutatis mutandis where a qualified merger has been carried out in which a corporation that has set aside the reserve for strengthening the farm management base referred to in paragraph (1) is the merged corporation. In this case, the phrase "is not a person" in paragraph (11) of that Article is deemed to be replaced with "is not a person or a certified qualified farmland-owning corporation prescribed in Article 61-2, paragraph (1)", and the phrase "paragraph (3)" in the first sentence of paragraph (12) of that Article is deemed to be replaced with "Article 61-2, paragraph (2)".

⑦Beyond what is provided for in paragraph (5), necessary matters concerning the application of the provisions of paragraphs (1) through (4) and the preceding paragraph are specified by Cabinet Order.

①Where a corporation that has the amount of the reserve for strengthening the farm management base referred to in paragraph (1) of the preceding Article (excluding an amount to which the provisions of paragraph (4) of that Article apply) (including a corporation that may receive the application of the provisions of paragraph (1) of that Article), in any business year, in accordance with the certified plan prescribed in that paragraph, makes an acquisition (excluding an acquisition by gift, by exchange, by capital contribution, or by a distribution in kind as prescribed in Article 2, item (xii)-5-2 of the Corporation Tax Act, an acquisition through a lease transaction without transfer of ownership, and any other acquisition specified by Cabinet Order; hereinafter the same applies in this paragraph) of agricultural land as prescribed in Article 4, paragraph (1), item (i) of the Act on Promotion of Improvement of Agricultural Management Foundation that has been designated, in a regional plan as prescribed in Article 19, paragraph (1) of that Act (limited to a plan for which public notice to the effect that it has been established has been given pursuant to the provisions of paragraph (8) of that Article, and, where public notice to the effect that it has been changed has been given pursuant to the provisions of that paragraph, meaning the plan after the change), as land to be used by the corporation (including a right of lease pertaining to that agricultural land; hereinafter the same applies in this paragraph), or makes an acquisition of agricultural machinery and equipment, tools, furniture and fixtures, buildings and their associated facilities, structures, and software (limited to those of a scale specified by Cabinet Order, and, for buildings and their associated facilities, limited to buildings specified by Order of the Ministry of Finance as buildings directly used for the corporation's agriculture, out of the agricultural facilities prescribed in Article 3, item (iv) of the Act on Establishment of Agricultural Promotion Regions that are constructed on land whose use has been designated as land listed in that item in an agricultural land use plan prescribed in Article 8, paragraph (4) of that Act, and their associated facilities; hereinafter referred to as "specified agricultural machinery, etc." in this paragraph and paragraph (4)) that have not been used for business since their manufacture or construction, or manufactures or constructs specified agricultural machinery, etc., and uses that agricultural land or specified agricultural machinery, etc. (hereinafter referred to as "agricultural land, etc." in this paragraph and paragraph (5)) for the corporation's agriculture, and if, for that agricultural land, etc., the corporation reduces its book value through accounting as an expense or loss within the limit of an amount not exceeding the lesser of the following amounts (hereinafter referred to as the "reduction entry limit" in this paragraph), or, instead of reducing its book value, accounts for an amount not exceeding the reduction entry limit by the method of setting it aside as a reserve in the finalized settlement of accounts for that business year (where the amount listed in Article 72, paragraph (1), item (i) or Article 144-4, paragraph (1), item (i) or item (ii) or paragraph (2), item (i) of the Corporation Tax Act is calculated, the settlement of accounts for the period prescribed in Article 72, paragraph (1) or Article 144-4, paragraph (1) or paragraph (2) of that Act (for a group tax sharing subsidiary corporation, the period prescribed in Article 72, paragraph (5), item (i) of that Act); hereinafter the same applies in this Chapter) (including the method of setting it aside as a reserve through the appropriation of surplus by the day on which the settlement of accounts for that business year is finalized), the amount equivalent to the amount so reduced or accounted for is included in deductible expenses in calculating the amount of income for that business year.

②The provisions of the preceding paragraph apply only if the tax return, etc. for the business year for which the corporation seeks the application of the provisions of that paragraph contains a statement concerning the inclusion in deductible expenses of the amount to be included in deductible expenses pursuant to the provisions of that paragraph, and has attached to it a written statement concerning the calculation of the amount to be included in deductible expenses and any other documents specified by Order of the Ministry of Finance.

③Even where a tax return, etc. without the statement or attachment referred to in the preceding paragraph has been filed, the district director may, when the district director finds that there were unavoidable circumstances for the absence of the statement or attachment, apply the provisions of paragraph (1), only if a document containing that statement, and the written statement and the documents specified by Order of the Ministry of Finance referred to in that paragraph, are submitted.

④The provisions listed in the items of Article 53, paragraph (1) do not apply to specified agricultural machinery, etc. to which the provisions of paragraph (1) have been applied.

⑤The calculation of the acquisition cost of agricultural land, etc. to which the provisions of paragraph (1) have been applied, in the case where the provisions of laws and regulations concerning corporation tax are applied to that agricultural land, etc., and other necessary matters concerning the application of the provisions of that paragraph are specified by Cabinet Order.