Governments that use support measures such as tax deferral for companies whose income has dropped significantly

Utilization of support measures such as tax deferment for companies with drastically reduced income Government on April 12, 16:01

The government has implemented tax support measures such as postponement of tax payments for companies whose income has decreased significantly in an emergency economic measure following the spread of the new coronavirus. For implementation, the target and application method are posted on the Ministry of Finance's website to encourage use.

According to the plan, companies whose income has decreased significantly and sole proprietors, including freelancers, will have one year to pay corporate taxes, consumption taxes, income taxes, and the collection of local taxes such as property taxes.

This applies to cases where the income has decreased by more than 20% compared to the same period of the previous year for more than one month after February, exempt from collateral and arrears tax. If grace is granted, social insurance premiums such as pensions and health insurance will be deferred as well.

In addition, small and medium enterprises and sole proprietors will be exempt from property tax and city planning tax on equipment and buildings only for one year, which will be levied in the next fiscal year, if the decrease in sales is large.

In the event of a deficit, a “return refund” that provides a refund of corporate tax retroactively to the past fiscal year is also a special case and applies to large companies with a capital of 1 billion yen or less.

The government wants to start the application process as soon as possible after amending the relevant law later this month.

Tax support measures Main contents

Emergency economic measures following the spread of the new coronavirus include measures to reduce the burden on companies that have been severely affected as tax support measures.

[Tax deferral of corporate tax and consumption tax]
For corporations and freelancers, including freelancers, whose income has decreased significantly, we will suspend the payment of national taxes such as corporate tax, consumption tax and income tax, and the collection of local taxes such as property tax for one year. This applies if your income has declined by more than 20% for at least one month since February compared to the same period of the previous year. In general, if tax payment or collection is deferred, in principle, security must be provided and arrears tax and arrears are imposed, but this time, as exceptions, both are exempted. If grace is granted, payment of social insurance premiums such as pensions and health insurance will be deferred as well. It is expected that these tax payments and the postponement of social insurance premiums will reduce the burden of about 26 trillion yen.

[Reduction of property tax]
SMEs and sole proprietors, whose sales continue to decline, will reduce or reduce the property tax and city planning tax on equipment and buildings only for the next year (the 3rd year of Reiwa). From February to October, the decrease in sales during the three months from the same period of the previous year is 30% or more, less than 50%, half price, 50% or more decrease Exempts the full amount. The reduction in local taxes resulting from this measure will be fully paid by the government.

[Expansion of "return refund"]
In the event of a deficit, we will expand the “return refund” system, which allows you to receive a refund of the corporate tax amount going back to the past business year. Normally, this applies to small and medium-sized businesses that make a “blue tax return” in which income and expenditures are recorded on books and books, but as a special case, it also applies to large companies with capital of 1 billion yen or less. Spread.

[Financing support of event]
The event was canceled in response to the government's request for self-restraint and as a result of the event, the organizer suffered a large loss.If the buyer did not request a refund for tickets for cultural, artistic and sporting events, the amount was donated. Apply "donation deduction" to reduce tax burden. By reducing ticket refund payments, we can keep cash on hand and support cash flow.

[Promotion of telework for SMEs]
Encourage corporate telework to spread due to the spread of infection. We will provide preferential treatment to small and medium-sized businesses and sole proprietors who have introduced equipment necessary for telework and equipment for videoconferencing, such as deducting up to 10% of the acquisition amount from the corporate tax amount.

[Extension of the “mortgage loan tax reduction” occupancy period]
Regarding special measures to extend the period for receiving the “mortgage tax cut” to 13 years, we will extend the period of occupancy, which is until the end of the year, for one year until the end of the next year. It is intended for people whose housing construction has been delayed due to the spread of the infection and who can move in late. In the case of new construction, contracts must be completed by the end of September. It must be done.

[Extension of "Environmental Performance Discount"]
The tax on environmental performance, which is based on fuel efficiency when a car is acquired, will also be extended by six months from the end of September to the end of March next year, from the end of September to the end of March next year. You. The reduction in local taxes resulting from this measure will be fully paid by the government.