This detailed list represents typical features necessary for a VAT software system in Japan, covering input handling, compliance with tax regulations, automation, and reporting needs. These functionalities ensure that businesses can efficiently manage their VAT obligations while remaining compliant with Japanese tax laws.
1. Transactional Classifications
- Taxable Classification: Determine whether each transaction is taxable, non-taxable (or exempt), or outside of taxation.
- Tax rate Classification: Determine qualified (standard, reduced) or categorized (a full, 80%) taxable purchases.
- Purpose Classification: Sales purpose classification (taxable, not-taxable or combined sales) required for itemized deduction method.
2. Amount Entry
- Tax-Inclusive/Exclusive Entry: Allow entry of amounts as either tax-inclusive or tax-exclusive.
- Rounding Options: Provide selection for rounding methods.
- Total Input by Tax Rate: Support input of totals by tax rate in compliance with invoice regulations.
- Cumulative and Proportional Calculations: Perform calculations based on accumulation or proportionate allocation.
3. Journal Entry Display in Accounting System
- Separate Display of VAT Amounts: Determine whether VAT amounts are displayed separately in journal entries.
4. Aggregation Functions
- Aggregation by Account and Tax Rate: Enable aggregation of taxable sales and purchases, categorized by account (and client) and by tax rate.
5. Transitional Measures Compliance
- Taxable Purchases from Exempt Businesses: Address the handling of taxable purchases from VAT exempt businesses.
- 20% Special Measure: Support for the 20% special measure.
- Small Amount Special Measure: Support for special measures related to small amounts less than 10,000 yen.
- Under 30,000 JPY Special Measure (permanent measure): Handle special cases for transactions under 30,000 yen.
6. Input Automation
- Electronic Transactions: Support for handling electronic transactions.
- Scanner Integration: Integration with scanners for document management.
- Bank Transactions: Facilitate bank transaction processing.
- Qualified Invoice Check: Provide a function to check for compliance with qualified invoice requirements.