Is donation tax deduction prepared?


​​【 An example deemed donation taxable 】

  • ​​Consideration not collected · contract not signed relate to the business trip for the technical assistance of foreign subsidiary.
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  • Global advertising expenses collective burden of the parent company.

Even among group companies, it is necessary to collect consideration as an independent company

【　What happens if it is regarded as donation tax?　】
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  • • It is difficult to overturn the indications in response after the tax authorities have pointed out.
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　→ In many cases, it is taxed as it is.
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  • Even in the case that can prove the rationality, there is a tendency to carry out a forceful taxation.
→　Recently "Key element" of tax investigation.
  • As the trend of the officer of the general tax audit, despite being originally a transfer pricing case, there are many cas-es handled as donation money.
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※　Compared to the transfer pricing taxation, donations taxation has many disad-vantages for the taxpayers.
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It is necessary to prepare in advance, including setting internal rules before the survey.

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【　How to reduce the risk of donation taxation?　】
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  • Consolidate the rules related to the creation and maintenance of contract, recording of business trip and charging consideration.
→　To insist on the purpose of business trips, adequacy of consideration etc to the tax authorities.
  • Documentation of transfer pricing and policy on collecting consideration among group companies.
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To clarify the functions and risks of the parent company and subsidiaries, to explain the rationality of the burden relationship of consideration between the parent company and subsidiaries.

→　To shift the burden of proof to the authorities, to avoid the risk of donation tax.

It is effective to prepare contracts and create policies in advance.
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Two reasons for recommending our company
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①　Broad follow-up range

As a common handling, there is a method by which the client responds to many question items created by the accounting firm. However, because its content is difficult, work often does not progress as expected, or investigation takes more time than imagined.


Although we may prepare question items, we will complete the answers of the questionnaire together while closely following the client. In this way, without forsaking the client, it is possible to minimize the client's burden.

Also, regarding items that require survey, we also include corre-spondence to investigate together, so you can leave it with con-fidence without expert knowledge.

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②　Abundant practical experience both in Japan and overseas

Even with qualifications and experience of accounting tax, there are actually many cases where there are no practical experiences. As a result, it often happens that it is difficult to communicate with the client due to not to understand what kind of processing is being done and what kind of flow is being promoted in the office work within the company.

We have not only knowledge of accounting tax but also practical experience in domestic and overseas, and we also grasp the pat-terns that companies tend to have, so we can do smooth sup-port.

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Contact us here
Trade Tax International Tax & Accounting  Osaka branch
Trade Tax West Japan Co.,Ltd.
Chida International Tax & Accounting

5-1-18, 11F, Miyahara, Yodogawa-Ku, Osaka-shi, Osaka 532-0003 JAPAN
TEL 06-6350-7100   FAX 06-6350-7101