What is the standard Japanese corporate tax rate?

The standard national corporate tax rate (hojin-zei) is 23.2% on taxable income. This applies to all companies that do not qualify for the SME reduced rate. A local corporate tax of 10.3% of the national tax is added on top.

What rate do SMEs pay in Japan?

Small and medium-sized enterprises with paid-in capital of ¥100 million or less pay a reduced national rate of 15% on the first ¥8 million of taxable income per year, and 23.2% on any income above ¥8 million. The local corporate tax (10.3% of national tax) applies to both brackets.

What is the local corporate tax (chiho hojin zei)?

The local corporate tax is a national-level surcharge calculated as 10.3% of the national corporate tax payable. It replaced the former local allocation tax and is collected alongside the national tax. It is separate from local inhabitant taxes levied by prefectures and municipalities (not included here).

Does this include prefecture and municipal taxes?

No. This calculator covers national corporate tax and national local corporate tax only. Prefectural and municipal inhabitant taxes (juminzei) and business taxes (jigyozei) vary by location and add roughly 6–10% additional effective burden. Consult a local tax accountant for the full combined rate.

Is taxable income the same as accounting profit?

Not necessarily. Taxable income under Japanese tax law is adjusted accounting profit — certain expenses are non-deductible and some items receive special deductions. Enter the NTA-adjusted taxable income for an accurate result.

What is the ¥8 million SME threshold based on?

The ¥8 million threshold (approximately $55,000 USD) is an annual figure per the Japanese corporate tax law (Hojin Zeihō). Income up to this amount per fiscal year qualifies for the 15% reduced rate for eligible SMEs.

Japan Corporate Tax Calculator

Enter your taxable income and company size to calculate Japan corporate tax — national rate, local corporate tax, and effective combined rate.

Company Details

Taxable Income (JPY ¥)

Company Type

Standard Company — 23.2% Paid-in capital over ¥100 million, or listed company

SME — 15% / 23.2% Paid-in capital ¥100M or less — 15% on first ¥8M, 23.2% above

Enter your taxable income and click Calculate Tax to see results.

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Summary

Japanese corporate income tax (hojin-zei) is levied at the national level, with an additional local corporate tax (chiho hojin zei) calculated as a percentage of the national tax. Standard companies pay a national rate of 23.2% on all taxable income. Small and medium-sized enterprises (SMEs) with paid-in capital of ¥100 million or less pay a reduced rate of 15% on the first ¥8 million of income and 23.2% on income above that threshold. The local corporate tax adds 10.3% on top of the national tax amount. This calculator shows national tax, local tax, total tax payable, after-tax income, and effective combined rate.

How it works

Enter your company's taxable income in Japanese Yen (JPY).
Select your company type — Standard Company or SME (paid-in capital ¥100M or less).
The calculator applies the national corporate tax: 15% on the first ¥8M for SMEs, 23.2% on the remainder (or all income for standard companies).
Local corporate tax is added at 10.3% of the national tax amount.
Total tax payable, after-tax income, and effective combined rate are displayed instantly.

Use cases

Estimate annual corporate tax liability for Japan tax filings.
Compare tax burden between SME and standard company classifications.
Model after-tax income for business planning and investor presentations.
Understand the combined effect of national and local corporate tax.
Verify preliminary tax calculations before consulting a Japanese tax accountant.
Plan profit distributions and retained earnings for Japanese subsidiaries.

Frequently Asked Questions

Last updated: 2026-06-15 · Reviewed by Nham Vu