Bookkeeping and retention for white return filers: books for 7 years, documents for 5 yearsEven with a "white return," you must keep records and hold on to them
People with real estate, business or forestry income must record income and expenses in books and keep books and documents even when filing a white return. Books recording income and expenses must be kept for 7 years, and documents such as invoices and receipts for 5 years. Failure to keep books or insufficient entries may lead to heavier additional taxes.
Key points
- Bookkeeping: record the date, counterparty, amount etc. of transactions in an orderly way. A simple method of writing only the daily totals together is also allowed
- Retention period: books recording income and necessary expenses (statutory books) are kept for 7 years
- Optional books, documents related to settlement such as inventory lists, and documents such as invoices, delivery notes and receipts are kept for 5 years
- People with miscellaneous income from business whose income two years earlier exceeded JPY 3 million must keep documents related to cash and deposit transactions
- From amended returns etc. for tax returns for 2023 (Reiwa 5), the additional tax on omitted income caused by failure to keep sales-related books or insufficient entries is increased by 5% or 10%
What to do in practice
- Record sales in your books without gaps, even if only as daily totals, and keep them for 7 years
- Keep invoices and receipts for 5 years. Also check the conditions under which electronic records can replace them
People who run a shop or rent out rooms must write down their money coming in and going out in a book, even with a "white return," which needs no special application. The books you write and the receipts you get must be kept, not thrown away, for a set number of years.
- ○Applies: Write money in and out in a book
- ○Applies: Keep books for 7 years
- ○Applies: Keep receipts and invoices for 5 years
- ×Does not apply: No need to keep records
Points
- Write earnings and payments in a book, even if only as daily totals
- Keep books for 7 years, and receipts and invoices for 5 years
- If your sales records are missing, extra tax can become heavier
What the words mean
- Book (帳簿)
- A notebook where you write down money coming in and going out
- Additional tax (加算税)
- An extra, penalty-like tax you pay when you reported too little
- National Tax Agency (NTA): NTA: Tax Answer No. 2080 Bookkeeping and record retention for white return filers
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.