NTA updated its guidance on global minimum tax rules, clarifying calculations and key definitions.
Japan’s National Tax Agency (NTA) released a revised version of its interpretative guidance on global minimum tax rules on 26 September 2025.
The guidance outlines the Japanese Corporation Tax Basic Circulars related to international taxation, detailing changes to the calculation of International Minimum Taxable Income. It compares the “Revised Post” and “Revised Before” provisions, clarifying definitions and calculation methods for key terms such as Permanent Establishment attributed income, Ultimate Parent Company Financial Accounting Standards, and Arm’s Length Price.
It further addresses the computation of Adjusted Covered Taxes and the allocation of taxes for various entities like permanent establishments and constituent entities under regimes such as the Controlled Foreign Corporation (CFC) tax system. Additionally, the revisions offer guidance on the treatment of deferred tax liabilities, particularly for those established before the Transition Accounting Year, and provide examples for defining key concepts related to shipping business operations and employee eligibility for certain deductions.
Earlier, the Japanese tax authority updated the FAQs regarding the country’s global minimum tax regulations, known as the income inclusion rule (IIR) on 13 September 2024.
