Cap on the transitional measure lowered from JPY 1 billion to JPY 100 million, judged on total purchases from each supplierOnce your purchases from one shop pass JPY 100 million, the rest is not covered
The transitional measure for taxable purchases from suppliers that are not qualified invoice issuers has a cap on annual purchase amounts. For taxable periods beginning on or after October 1, 2026 (Reiwa 8), the cap is lowered from JPY 1 billion to JPY 100 million.
Key points
- The part of annual taxable purchases (tax included) from one supplier (not a qualified invoice issuer) that exceeds JPY 100 million cannot use the transitional measure
- The cap before the revision was JPY 1 billion
- The JPY 100 million cap applies from taxable periods beginning on or after October 1, 2026 (Reiwa 8)
- For taxable periods beginning on or after October 1, 2024 (Reiwa 6), the pre-revision cap of JPY 1 billion is used
What to do in practice
- Total up the annual (business year) purchases, tax included, from each supplier and check whether any supplier is close to JPY 100 million
There is a special rule that lets you deduct part of the consumption tax on purchases from shops that do not issue invoices, and it has a limit per shop. From periods starting in October 2026 (Reiwa 8) or later, that limit drops sharply from JPY 1 billion to JPY 100 million.
- Purchases from one shop (tax included)
- JPY 150 million
- - Cap of JPY 100 million
- JPY 100 million
- Part not covered
- JPY 50 million
Points
- The limit is based on the total you buy from one shop in one year
- The part over JPY 100 million is not covered by the special rule
- The new limit applies to one-year periods (for a company, business years) that start after October 1, 2026 (Reiwa 8)
What the words mean
- Limit (cap)
- The top line: nothing above it is allowed.
- National Tax Agency (NTA): NTA: Special feature on the FY2026 (Reiwa 8) tax reform (invoice system)
- National Tax Agency (NTA): NTA: No. 6498 Qualified invoice system (invoice system)
This article summarizes and explains materials published by government agencies and is not advice on any individual case. Rules can change, so for actual procedures and decisions always check the latest original materials and consult professionals such as tax accountants or labor and social security attorneys. English, Simplified Chinese and Traditional Chinese versions are translations prepared from the Japanese articles for convenience. If anything differs, the Japanese text and the original source take precedence.