What is Grace system?
Grace system for national taxes is that taxpayers will be granted grace of tax payment for up to one year by applying to the tax office if taxpayers are in special circumstances such as they are likely to face difficulty continuing business or maintaining standard of living by paying the national tax in a lump sum, or they have lost their assets due to disasters (Note).
There are (1) Grace of asset conversion (Article 151 and 151-2 of the National Tax Collection Act) and (2) Grace of tax payment (Article 46 of the Acts on General Rules for National Taxes).

Note: Methods of tax payment are followings:

  1. (1) defer payment for one year; or
  2. (2) make installment payment during the grace period depending on the taxpayer's financial resources.

Application dead line for Special grace
Special Grace of Tax Payment (Special grace) which was established following enactment and enforcement of the "Act on Extraordinary Exception on National Tax Related Laws to Address the Impact of the Novel Coronavirus Disease" on April 30, 2020 has ended on February 1, 2021. However, if it is recognized you had unavoidable reasons why you could not apply for Special grace for the taxes which were due by February 1, 2021 by their due date, you may apply for Special grace after the due date. Please consult your district tax office (collection group) about how to apply, etc.

[Application form for the Special grace]

Requirements for and effects of Grace of asset conversion
Taxpayers who meet following requirements are eligible for Grace of asset conversion by application within six months from the due date for payment of taxes.

  1. (1) It is recognized that you are likely to face difficulty continuing your business or maintaining your standard of living by paying national taxes in a lump sum.
  2. (2) It is recognized that you have sincere intention to pay taxes.
  3. (3) You have no outstanding national taxes other than the taxes for which you are applying for grace.
  • Note 1: Even if you already have other outstanding national taxes or have had national taxes unpaid for more than six months after their due date, you may be granted Grace of asset conversion by the director of your district tax office. (Article 151 of the National Tax Collection Act)
  • Note 2: No security will be necessary unless it is obviously possible to provide such security.

In the case Grace of asset conversion is granted,

  1. (1) You will be granted the grace for one year in principle. (It may be extended for a further one year, depending on circumstances.)
  2. (2) Delinquent tax (interest on principal tax) during the grace period will be reduced*.
  3. * In 2021, the rate of delinquent tax will be reduced from 8.8% per annum to 1.0% per annum.
  4. (3) Seizure of assets or asset conversion (sale of assets) will be suspended.

Requirements for and effects of grace of tax payment
In the case of the following individual circumstances, grace of tax payment may be granted.
Examples of individual circumstances:

  1. (1) You were forced to dispose of furnishings or inventory due to disinfection having been carried out at a facility where a COVID-19 infection case was confirmed.
  2. (2) If you or your family members living in the same household became ill, you can be granted the grace for the amount equivalent to medical expenses and the costs associated with treatment etc. in the national tax you cannot pay in a lump sum.
  3. (3) If you were forced to close or suspend your business, you can be granted the grace for the amount equivalent to losses or expenses caused by such closure or suspension of business in the national tax you cannot pay in a lump sum.
  4. (4) If you suffered considerable losses in your business due to a decrease in profits, you can be granted the grace for the amount equivalent to the losses suffered in the national tax you cannot pay in a lump sum.

In the case Grace of tax payment is granted,

  1. (1) You will be granted the grace for one year in principle. (It may be extended for a further one year, depending on circumstances.)
  2. (2) Delinquent tax (interest on principal tax) during the grace period will be reduced or exempted*.
  3. * In 2021, the rate of delinquent tax will be reduced from 8.8% per annum to 1.0% per annum.
  4. (3) Seizure of assets or asset conversion (sale of assets) will be suspended.

Inquiries and consultations regarding tax grace
For general information regarding tax grace, please contact the Regional Taxation Bureau Grace Support Center or check the following leaflet and FAQ (Frequently Asked Questions).
For inquiries regarding the details of grace system and individual circumstances, please feel free to consult your district tax office (collection group).

How to apply for grace
Please download the Application form for tax grace below, and submit it to the tax office (Note 1) which has jurisdiction over your address by the dead line of each grace system (Note 2).
For details on how to fill out the application form, please contact the Regional Taxation Bureau Grace Support Center.
To prevent congestion of the tax office counter, we ask that you submit the application form electronically via e-Tax or by post.

  • Note 1: For address of the tax office, please check here (Japanese language).
  • Note 2: You need to submit the application form for grace of asset conversion within six months after the due date for payment of national taxes in principle. Please consult your district tax office (collection group) about the details.

[Application form]

[Other form]

Other
In the case where grace is granted to you, a notification of the grant of grace will be sent to you.
The notification includes the articles relevant to the granted grace.

Aside from the grace system, you can check the NTA's response to COVID-19 on the URL below.

Regarding the NTA's responses to the COVID-19 (Japanese language)

In the case where you cannot pay the tax amount during the Special grace period, you may be granted Conventional grace.
You need to pay the tax granted Special grace by the end of the grace period with tax payment slips at a financial institution etc. However, in the case you cannot fully pay the tax during the Special grace period, please contact your district tax office (collection group) since you may be granted other grace depending on your situation if applicable.

  • Note: In the case you obtain a certificate of tax payment regarding the amount for which grace has been granted during the Special grace period, it will be written to the effect that "you have been granted Special grace under the provisions of Article 3 of the Act on Extraordinary Exception on National Tax Related Laws to Address the Impact of the Novel Coronavirus Disease" in the "Remarks" section of the certificate.

[Certificate of tax payment]

[Leaflet]

[Other form]

Explanation videos
Please refer to following videos explaining the outline of how to submit/fill in the application forms for tax grace.
These videos are linked to the National Tax Agency Video Channel on YouTube, and a separate window will open.
Please be aware that some contents in these videos such as the application form, etc. might differ from the latest ones.

[For those who are newly applying for Conventional grace]

play@Click here to play the video.

[For those who have already been granted Special grace]

play@Click here to play the video.