What is mandatory electronic filing of statutory reports?

Statutory reports are documents required by various laws and regulations, such as the Income Tax Law and Inheritance Tax Law, and there are more than 50 types of statutory reports. Since a huge number of statutory reports are submitted every year, electronic filing of tax returns by e-tax and other means has long been encouraged in view of the paperless paperwork costs in both the public and private sectors.
However, since e-filing used to be mandatory only when the number of sheets submitted per type exceeded 1,000, many companies and corporations have not yet taken the step to e-file their tax returns.

However, the system has been changed so that for submissions beginning in January 2021, the number of documents submitted for each type of report will be required to exceed 100 documents.
 

As a result, companies that have not been e-filing up to this point are now seeking ways to adapt their systems, etc., or to find a mechanism to make e-filing more efficient.

Documents subject to mandatory electronic filing

In principle, more than 50 types of documents are subject to the e-filing mandate All of the statutory reports In principle, all of the more than 50 types of statutory reports are required to be filed electronically.

However, the main documents that will be particularly affected in the accounting and general affairs departments of general companies will be "payment reports of remuneration, fees, contracts, and prize money" and "payment reports of real estate rental fees, etc.".

Example 1) Payment record of remuneration, fees, contracts, and prize money

This is a document to be prepared when remuneration is paid to individuals, such as freelancers, for their work, and is used to report the annual amount of payment and withholding tax to the tax office.
It is probably prepared mainly by the accounting department or other departments to compile information on payments.

Example 2: Report of payment of real estate rental fees, etc.

This form is prepared when a payment is made to an individual out of real estate used as a store or business office. This form is used for companies that operate local roadside stores, etc., and pay rent to private landowners. In many cases, this form is also prepared by the accounting department, general affairs department, store management department, etc.

Documents subject to mandatory e-filing

As described above, various types of statutory reports are subject to electronic filing, and we will now look specifically at the conditions under which electronic filing is obligatory.

Condition 1: At least 100 sheets for each type of record were submitted in the previous two years

The first condition is that at least 100 copies of each type of record must be submitted.
Therefore, if only a few dozen sheets are generated for one type of statement, or if the total number of sheets exceeds 100 for two types of statements (e.g., a statement of payment for real estate rental fees and a statement of payment for brokerage commissions for the sale or lease of real estate, etc.), then they are not subject to this requirement.
In addition, since the basis for judgment is the two preceding years, for example, if "90 sheets were submitted in the first year and 110 sheets in the second year," then "electronic filing is mandatory in 2022, but not in 2021.

Condition 2: Submission will be made in January 2021 or later

The second condition is that the submission must be made in January 2021 or later. If the submission is made before January 2021, it will not be subject to the e-filing requirement unless there are more than 1,000 sheets for each type of report.

Therefore, when combined with the "previous two years" requirement mentioned above, e-filing will become mandatory if 100 or more statements were submitted in January 2019 or later.

How to automate e-filing in the system

Finally, we will explain how to automate the implementation of e-filing through the use of systems.
E-filing requires two steps: (1) preparation of tax return data in a format that can be imported by e-tax, etc., and (2) importing of the data by e-tax, etc.

① Prepare tax return data in a format that can be imported by e-tax, etc.

For example, in the case of a report of payment for real estate rental fees, it is very complicated to compile the amount of payment to the lessor for each office and to compile the necessary information for the tax return.

If it is a payment report for real estate, such work can be automated by a rental real estate management system, allowing the system to perform the work efficiently.

② Import data by e-tax, etc.

Once the information is ready, the actual e-filing is carried out using the e-Tax software (installed version/web version). You can choose from the following two options.

(1) When using e-Tax software (installed version)

You can install the software from the " e-Tax Software Download Corner. With the installed version, you can submit any type of statutory report without limitation.

When using e-Tax software (WEB version)

You can submit 9 types of statutory reports such as "Certificate of Withholding Tax for Salary Income" and "Record of Payment for Use of Real Estate, etc." by using e-Tax software (WEB version).

On the e-tax software, it is possible to create and submit a statement by importing a CSV file, but it is necessary to form the tax return information created by the system into a form that can be imported by e-tax or other software.
HUE, an accounting system for major companies provided by Works Applications, can create reports and output files that can be automatically imported by e-tax, etc. for "payment reports for real estate rental fees," "payment reports for remuneration, fees, contracts, and monetary awards," etc. The system is designed to match the Japanese tax system and business customs. We offer real estate management functions and payment management functions that match the Japanese tax system and business customs, etc. Please contact us if you are interested.

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