Entry into force of the Tax Convention between Japan and Peru
On December 30, 2020, Japan received from Peru the notification confirming that its internal procedures necessary for the entry into force of the Convention between Japan and the Republic of Peru for the Elimination of Double Taxation with respect to Taxes on Income and the Prevention of Tax Evasion and Avoidance (PDF) (signed on November 18, 2019) were completed. Thus, all the necessary procedures for the entry into force of the Convention have been completed.
- The Convention, therefore, will enter into force on January 29, 2021 (the thirtieth day after the date of receipt of the latter notification) and will have effect:
(1) in Japan:
(a) with respect to taxes levied on the basis of a taxable year, for taxes for any taxable years beginning on or after January 1, 2022; and
(b) with respect to taxes levied not on the basis of a taxable year, for taxes levied on or after January 1, 2022; and
(2) in Peru:
with respect to taxes on income obtained and amounts paid, credited to an account, or accounted as an expense, on or after January 1, 2022.
- The provisions concerning the exchange of information and the assistance in the collection of taxes will have effect from the following dates without regard to the date on which the taxes are levied or the taxable year to which the taxes relate:
(1) with respect to the provisions of the exchange of information, January 29, 2021; and
(2) with respect to the provisions of the assistance in the collection of taxes, the date to be agreed between the Governments of the two countries through an exchange of diplomatic notes.
- It is expected that, while eliminating double taxation and preventing international tax evasion and tax avoidance, the Convention promotes further mutual investments and economic exchanges between the two countries.