Newsletter #004 2026 Tax Reform Series – Part 6 What Should Foreign Business Owners Check Now?

Helping foreign business owners understand Japan's tax system—one topic at a time.

Over the past few weeks, we have introduced some important items in Japan's 2026 Tax Reform.

The rules are complicated, but you do not need to understand every detail. The important thing is to know which changes may affect you and your business.

If You Are a Sole Proprietor

Check the changes to the Blue Return Special Deduction.

From 2027, the maximum deduction will increase to ¥750,000, but additional requirements must be met.

Now is a good time to review your bookkeeping, accounting software, and e-Tax filing system.

If You Own a Company

Review changes that may affect:

• employee salaries and benefits,

• business investment, and

• transactions with related companies.

Some changes may require advance preparation.

If You Pay Consumption Tax

Check the changes to the Invoice System and transitional input tax credit rules.

Small businesses should also review which consumption tax method is suitable for them.

If You Invest in Crypto Assets

Major changes to crypto asset taxation have been proposed.

The rules are still developing, so we will provide further updates when the details become clear.

Key Takeaway

You do not need to understand every tax reform.

You only need to understand the changes that affect you and your business — and prepare for them at the right time.

We will continue to explain Japan's tax system in simple and practical English.

Coming Next

This concludes our 2026 Tax Reform Series.

Next, we will begin a new series focusing on the basic tax knowledge that foreign business owners need when starting and running a business in Japan.

Prepared by　Kyoji Yasui Tax Accountant Office

Helping foreign business owners understand Japan's tax system with clear, practical guidance.