①The amount of gain on gifts received that a domestic corporation has received in each business year from another domestic corporation with which the domestic corporation has a full controlling interest (limited to a full controlling interest held by a corporation) (limited to an amount corresponding to the amount of a donation prescribed in Article 37, paragraph (7) that would be included in deductible expenses, when calculating the amount of income of the other domestic corporation for each business year, if the provisions of Article 37 (Exclusion of Contributions or Donations from Deductible Expenses) were not applied) is excluded from gross profits, when calculating the amount of income of the domestic corporation for each business year.

②The amount of gain on gifts received prescribed in the preceding paragraph, irrespective of the gift having been made as a donation, contribution, gift, or under any other name, is to be the amount of monies, the value of the assets other than monies as of the time of the gift, or the value of the economic benefits as of the time of the conveyance, in the case where a domestic corporation has received a gift or the gratuitous conveyance of monies or other assets or economic benefits (excluding those to be deemed expenses for advertising or providing samples or other equivalent expenses, and entertainment and social expenses, reception expenses, and welfare expenses; the same applies in the following paragraph).

③In the case where a domestic corporation has received a transfer of assets or a conveyance of economic benefits, when the price for the transfer or conveyance is low compared with the value of the assets as of the transfer or the value of the economic benefits as of the conveyance, the portion of the difference between the price and the value that is found to have been, in effect, received as a gift or gratuitous conveyance is to be included in the amount of gain on gifts received set forth in the preceding paragraph.

①In the case where a domestic corporation receives a refund of the following amount or the amount to be refunded is to be appropriated for the unpaid national tax or local tax, the amount to be refunded or to be appropriated is excluded from gross profits, when calculating the amount of income of the domestic corporation for each business year:

②In the case where the amount of foreign withholding tax, etc. prescribed in Article 39-2 (Exclusion of Foreign Withholding Tax, etc. on Dividends Received from Foreign Subsidiaries from Deductible Expenses) that is excluded from deductible expenses of a domestic corporation, when calculating the amount of income for each business year pursuant to the provisions of that Article, has been reduced, the amount of the reduction is excluded from gross profits, when calculating the amount of income of the domestic corporation for each business year.

③In the case where the amount of a foreign country's corporate tax (meaning the foreign country's corporate tax prescribed in Article 69, paragraph (1) (Foreign Tax Credit); hereinafter the same applies in this paragraph) that a domestic corporation has come to pay, for which the domestic corporation was subject to the provisions of paragraphs (1) through (3) or paragraph (18) of that Article (including as applied mutatis mutandis pursuant to paragraph (24) of that Article), has been reduced in each business year of the domestic corporation beginning within seven years after the first day of the business year in which it was subject to those provisions (hereinafter referred to as the "applicable business year" in this paragraph) (when the domestic corporation has received the transfer of the whole or a part of the business from another domestic corporation that is an acquired corporation, etc. as prescribed in paragraph (9) of that Article as a result of a qualified merger, etc. as prescribed in that paragraph, including the case where, out of the amount of the foreign country's corporate tax that the acquired corporation, etc. has come to pay, the amount of the foreign country's corporate tax that it has come to pay on the basis of the income arising from the business transferred to the domestic corporation has been reduced in each business year of the domestic corporation beginning within seven years after the first day of the applicable business year of the acquired corporation, etc. pertaining to that amount), the amount specified by Cabinet Order as the reduced portion of the creditable amount of the foreign country's corporate tax prescribed in paragraph (1) of that Article out of the amount of the reduction (excluding the amount specified by Cabinet Order as the amount to be included in gross profits) is excluded from gross profits, when calculating the amount of income of the domestic corporation for each business year.

④In the case where a domestic corporation receives from another domestic corporation the group tax sharing tax effect amount of the other domestic corporation (meaning the amount exchanged between a group tax sharing corporation and another group tax sharing corporation as the amount equivalent to the amount of corporation tax and local corporation tax (excluding the amount of interest tax) that is reduced by applying the provisions of Article 64-5, paragraph (1) (Aggregation of Profits and Losses) or Article 64-7 (Aggregation of Losses) or any other provisions applicable only to group tax sharing corporations (including a domestic corporation that was a group tax sharing corporation; hereinafter the same applies in this paragraph)), the amount received is excluded from gross profits, when calculating the amount of income of the domestic corporation for each business year.

⑤In the case where a domestic corporation receives a refund of the amount to be excluded from deductible expenses in the calculation of the amount of income for each business year, pursuant to the provisions of Article 55, paragraph (5), the amount to be refunded is excluded from gross profits, when calculating the amount of income of the domestic corporation for each business year.

In the case where, with regard to the net operating loss caused by a disaster prescribed in Article 80, paragraph (5) (Refund by Carryback of Loss) that has arisen in the interim period prescribed in that paragraph of a domestic corporation (hereinafter referred to as the "net operating loss caused by a disaster" in this Article), the domestic corporation (including another group tax sharing corporation, if the domestic corporation is a group tax sharing corporation) was subject to the provisions of Article 80, the amount equivalent to the net operating loss caused by a disaster that was used as the basis of the calculation of the amount to be refunded by filing the interim return based on provisional accounts prescribed in that paragraph (if the domestic corporation is a group tax sharing corporation, the amount that was treated as the amount used as the basis of the calculation of the amount to be refunded pursuant to the provisions of paragraph (13) of that Article) is included in gross profits, when calculating the amount of income for the business year containing the interim period.

①When, with regard to a domestic corporation's inventory, calculating the amount to be included in deductible expenses in each business year in the calculation of the amount of income for the business year, pursuant to the provisions of Article 22, paragraph (3) (The Amount to be Included in Deductible Expenses in Each Business Year), the value of the inventory held by the domestic corporation as of the end of the business year that is used as the basis of the calculation (hereinafter referred to as the "closing inventory" in this paragraph) is to be the amount evaluated based on the valuation method that the domestic corporation selected for the closing inventory from among the method of treating the average acquisition cost of inventory as the fair value of the inventory held as of the end of the business year and other valuation methods specified by Cabinet Order (in the case where the domestic corporation did not select any valuation method or did not evaluate the inventory based on the valuation method of their choice, the amount evaluated based on one of the valuation methods specified by Cabinet Order).

②Cabinet Order provides for special provisions on the selectable valuation methods referred to in the preceding paragraph, the way of selecting a valuation method, the acquisition cost of inventory to be used as the basis of the calculation of the fair value of inventory, and other necessary particulars concerning the valuation of inventory.

①With regard to depreciable assets held by a domestic corporation as of the end of each business year, the amount to be included in deductible expenses as the depreciation allowance thereof in the calculation of the amount of income for the business year, pursuant to the provisions of Article 22, paragraph (3) (General Rules for Calculation of the Amount of Income for Each Business Year), is the portion of the amount that the domestic corporation accounted for as a loss as its depreciation allowance in the business year (hereinafter referred to as the "amount accounted for as a loss" in this Article) up to the amount calculated as specified by Cabinet Order based on the depreciation method that the domestic corporation selected for the assets from among the depreciation method under which the depreciation allowance is the same every year, the depreciation method under which the depreciation allowance decreases at a fixed rate every year, and other depreciation methods specified by Cabinet Order, in accordance with the date of the acquisition of assets and the category of their types (in the case where the domestic corporation did not select any depreciation method, based on one of depreciation methods as specified by Cabinet Order) (such calculated amount is referred to as the "maximum amount of depreciation" in the following paragraph).

②In the case where a domestic corporation transfers its depreciable assets to a succeeding corporation in a company split, corporation receiving a capital contribution in kind, or corporation receiving a distribution in kind as a result of a qualified company split, qualified capital contribution in kind, or qualified in-kind distribution (for a qualified in-kind distribution, excluding a distribution of all residual assets; hereinafter referred to as a "qualified company split, etc." through to paragraph (4)), when the amount equivalent to the amount accounted for as a loss was accounted for as a loss with regard to the depreciable assets, the portion of the amount accounted for as a loss (referred to as the "amount accounted for as a loss during the period" in the following paragraph and paragraph (4)) up to the amount equivalent to the maximum amount of depreciation calculated with regard to the depreciable assets as prescribed in the preceding paragraph by deeming the day prior to the date of the qualified company split, etc. to be the last day of the business year is included in deductible expenses, when calculating the amount of income for the business year containing the date of the qualified company split, etc. (referred to as the "business year of the company split, etc." in paragraph (4)).

③The provisions of the preceding paragraph apply only in the case where the domestic corporation set forth in the paragraph has submitted a document stating the amount accounted for as a loss during the period and other matters specified by Ministry of Finance Order to the competent district director with jurisdiction over the place for tax payment, within two months after the date of the qualified company split, etc.

④Out of the amount accounted for as a loss for depreciable assets set forth in paragraph (1) in each business year prior to the business year in which a depreciation allowance for the depreciable assets was accounted for as a loss by the domestic corporation set forth in the paragraph (hereinafter referred to as the "business year of the depreciation" in this paragraph) (such amount accounted for includes, when the depreciable assets were transferred from an acquired corporation or corporation making a distribution in kind (hereinafter referred to as an "acquired corporation, etc." in this paragraph) as a result of a qualified merger or qualified in-kind distribution (limited to a distribution of all residual assets), the portion of the amount accounted for as a loss in each business year on or before the business year containing the day prior to the date of the qualified merger or the date of the determination of residual assets of the acquired corporation, etc. that was excluded from deductible expenses in the calculation of the amount of income for the business year, and when the depreciable assets were transferred from a splitting corporation, corporation making a capital contribution in kind, or corporation making a distribution in kind (hereinafter referred to as a "splitting corporation, etc." in this paragraph) as a result of a qualified company split, etc., the amount recorded in the books as the amount accounted for as a loss during the period in the business year of the company split, etc. of the splitting corporation, etc., and the portion of the amount accounted for as a loss in each business year prior to the business year of the company split, etc. that was excluded from deductible expenses in the calculation of the amount of income for each business year on or before the business year of the company split, etc.; hereinafter the same applies in this paragraph), the amount accounted for as a loss includes the amount excluded from deductible expenses in the calculation of the amount of income for each business year prior to the business year of the depreciation; and the amount accounted for as a loss during the period includes the portion of the amount accounted for as a loss for depreciable assets set forth in paragraph (2) in each business year prior to the business year of the company split, etc. of the domestic corporation set forth in the paragraph that was excluded from deductible expenses in the calculation of the amount of income for the business year.

⑤In the case referred to in the preceding paragraph, with regard to depreciable assets held by the domestic corporation (limited to depreciable assets transferred from an acquired corporation as a result of a qualified merger, depreciable assets falling under the category of assets evaluated by fair value prescribed in Article 62-9, paragraph (1) (Gains or Losses on the Fair Valuation of Assets Held by Wholly Owned Subsidiary Corporations in a share exchange Involved in Non-qualified Share Exchange) to which the provisions of the paragraph were applied, and other depreciable assets as specified by Cabinet Order), in the case where the amount specified by Cabinet Order as the amount recorded in the books as the value of the depreciable assets is less than the amount recorded in the acquired corporation's books immediately prior to the transfer, the book value immediately after the provisions of paragraph (1) of the Article were applied, or any other amount specified by Cabinet Order, the amount of the shortfall is deemed to be the amount accounted for as a loss in each business year prior to the business year specified by Cabinet Order.

⑥Special provisions on depreciation methods that can be selected as set forth in paragraph (1), procedures for selecting a depreciation method, acquisition costs of depreciable assets that are used as the basis of the calculation of the depreciation allowance, special provisions under which the amount corresponding to the portion that extends the usable period, etc., out of the amount expended on depreciable assets, is treated as the acquisition cost of depreciable assets, and other matters necessary for the depreciation of depreciable assets are specified by Cabinet Order.