Businesses in Japan should retain VAT records for a specific period to comply with audit requirements:
- Retention Period:
VAT records, including invoices, receipts, import/export documents, contracts, accounting records, and bank statements, should be retained for at least seven years from the end of the fiscal year to which they relate. - Reason for Retention:
These records serve as evidence to support the amounts reported in VAT returns and may be requested by the National Tax Agency (NTA) during audits or inspections. - Penalties for Non-Compliance:
Failure to retain records for the required period could result in penalties, fines, or adverse consequences during tax audits.
Maintaining organized and accurate records for the prescribed period is essential for demonstrating compliance with VAT regulations and ensuring a smooth audit process. A Japanese tax professional can provide guidance on record-keeping best practices and assist in establishing efficient record retention procedures.
The information provided here is based on legislation as it stands on the date of publication and may not reflect subsequent changes. We advise clients to seek tailored professional advice before making any decisions based on this information.