Slide 1

The Complete Guide to the
Invoice System for Affiliate Income

Deciding when to become a taxable business, by income range
¥10M
Taxable-business threshold
2026
Mid-transition period
10%
Consumption tax rate
3 yrs
Until full enforcement
📌 What you'll learnThe basics of the Invoice System, the tax-exempt vs. taxable decision, transitional measures, the registration flow, and when to consult a tax accountant — all in 9 slides.
Slide 2 / System overview

The Invoice System
and its impact on affiliates

Two areas of impact: payout calculation and continued business
  • Impact 1
    How consumption tax is calculated on your payouts changesTax-exempt businesses cannot issue qualified invoices, so the ASP cannot claim the input tax credit and effectively bears the cost.
  • Impact 2
    A factor in whether business continuesSome ASPs are scaling back or ending dealings with tax-exempt businesses. There is a risk of reduced payouts.
Slide 3 / Income-based decision

Tax-exempt vs. taxable
by income range

Under ¥1M stays exempt; over ¥10M must be taxable
Income rangeRecommendation
Up to ¥1MTax-exempt business
¥1M–¥5MDepends on situation
¥5M–¥10MUsually taxable
Over ¥10MMust be taxable
⚠️ NoteThese are general guidelines only. Consult a tax accountant about your specific situation.
Slide 4 / Transitional measures

The 2026 transitional
measures and what's ahead

From October 2029, the credit is generally unavailable
PeriodCredit on purchases from tax-exempt businesses
Through Sept 202680% credit available
Oct 2026 – Sept 202950% credit
From Oct 2029Generally no credit
⚠️ WarningHeading toward 2029, ASPs are expected to push harder for taxable-business status. Decide your approach while you still have time.
Slide 5 / Registration flow

Registering as a taxable
business in 4 steps

Apply → choose method → notify ASPs → file consumption tax
  1. Apply to register as a qualified invoice issuerVia e-Tax or paper; 2–4 weeks
  2. Choose the simplified or general taxation methodIf annual sales are ¥50M or less, the simplified method means less administrative burden
  3. Notify your partner ASPs of your registration numberYou can now issue qualified invoices
  4. Prepare for consumption tax filingA consumption tax return is added from the following year
Slide 6 / Simplified vs. general

Simplified vs. general taxation:
which for affiliates?

With few expenses, simplified taxation is favorable
ItemSimplifiedGeneral
Admin burdenLowHigh
Deemed purchase rate50%Actual cost
When it's favorableFew expensesMany expenses
EligibilityAnnual sales ¥50M or lessNo limit
Slide 7 / Tax-accountant consultation

When you should consult
a tax accountant

Essential if income exceeds ¥2M or your situation is complex
  • Trigger 1
    Annual affiliate income over ¥2M
  • Trigger 2
    Main job + side income totaling over ¥5M
  • Trigger 3
    Invoice handling differs across multiple ASPs
  • Trigger 4
    You want to file a blue return as business income
💡 Cost guideA one-off consultation typically runs ¥10,000–¥30,000; a monthly retainer ¥10,000–¥30,000. A misjudgment can cost hundreds of thousands of yen.
Slide 8 / Pitfalls

3 mistakes
to avoid

Procrastinating, going solo, and canceling right after registering
  • Mistake 1
    Putting off the decisionThe closer the 2029 end of transitional measures gets, the less freedom you have to choose.
  • Mistake 2
    Filing incorrectly on your own judgmentConsumption tax filing errors risk late-payment and additional taxes.
  • Mistake 3
    Canceling within 2 years of registeringThere's a restriction preventing a return to tax-exempt status for 2 years. Don't register lightly.
Slide 9 / Summary

Today's action plan
in 3 steps

Know your income → check ASP intentions → consult an accountant

📋 Recap

1. System: Consumption tax credits based on qualified invoices
2. Impact: Payout calculation + a factor in continued business
3. Decision: Tax-exempt/taxable splits by income range
4. Transition: Generally no credit from 2029
5. Registration: 4 steps + simplified/general choice
Plus: Over ¥2M means a tax accountant is essential
✅ Bottom line: The Invoice System has a real impact on affiliates too. Under ¥1M, stay tax-exempt; over ¥10M, taxable is mandatory; in between, decide case by case. With the 2029 end of transitional measures approaching, we recommend deciding your approach within this year. Leave the final call to a tax accountant.

🚀 A stable income base comes before Invoice planning

If you have no steady income in the first place, there's no need to think about the Invoice System yet. Start by building recurring income with Kingfin.

Start with Kingfin for free →
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