What are taxable sales?


Under the Japan consumption tax rule, sales can be classified into several categories as follows. And you need to correctly record accounting transactions based on those. You may also have to change settings in your accounting software.


  • Taxable sales

Providing your products or services in Japan are basically taxable sales unless it is non-taxable sales or tax exempt sales.

  • Non-taxable sales

Below sales are non-taxable sales because it is considered inappropriate for taxation.

Non-taxable sales Remarks
Land leasing and land sales Except leasing of land for less than one month
Selling of securities and monetary instruments
Interest and insurance premiums
Selling of postage stamps and revenue stamps
Services provided by the government and foreign exchange services
Medical services under the laws
Social welfare services under the laws
Midwifery services
Burial services
Selling of equipments for the disabled Wheelchairs, etc
School tuitions and other fees
Selling of authorised textbooks under the school law
Renting a house Except hotels, renting it for less than one month, renting it for business purposes, etc
  • Tax exempt sales

Tax exempt sales Remarks
Export from Japan
Selling ‘foreign goods’ in Japan ‘Foreign goods’ are goods that are permitted to export them to foreign countries, and goods that are not yet permitted to import them from foreign countries.
International transportation Passengers and cargo transportation
Selling and leasing of ships and aircraft for international transportation Passengers and cargo transportation
Repairing ships and aircraft for international transportation
Leasing of containers for international transportation
Providing services for shipping companies Port of entry assistance, etc
Providing services for ‘foreign goods’ Storage, inspection, etc
International communication and mail
Selling and leasing of intellectual property rights to non-residents Copyright, etc
Providing services to non-residents Except services such as transport, storage, foods, hotels, provided in Japan.
  • None of the above

Example: Selling goods in foreign countries, receiving donation, etc