Article 62 (Calculation of Depreciation Expenses as Necessary Expenses)

In paragraph ①, "depreciable assets" refers to assets falling under any of the following categories that are directly used in the business (excluding those whose value does not decrease with the passage of time). <Amended Dec. 31, 2001, Dec. 30, 2002, Feb. 19, 2005, June 30, 2005, Mar. 29, 2017, Feb. 11, 2020, Aug. 26, 2020, Feb. 28, 2025> 1. Tangible assets falling under any of the following categories: a. Buildings (including attached facilities) and structures (hereinafter referred to as "buildings and structures") b. Vehicles and transportation equipment, tools, instruments, and fixtures c. Ships and aircraft d. Machinery and equipment e. Animals and plants f. Tangible assets similar to those in items a through e 2. Intangible assets falling under any of the following categories: a. Goodwill, design rights, utility model rights, trademark rights b. Patent rights, fishing rights, aquaculture rights, mining rights under the 「Act on the Development of Undersea Mineral Resources」, toll road management rights, repair rights, rights to use electricity and gas supply facilities, rights to use industrial water supply facilities, rights to use water supply facilities, rights to use heat supply facilities c. Mining rights, rights to use exclusive telephone lines, rights to use exclusive circuits, rights to manage sewage treatment facilities, rights to manage water supply facilities d. Dam usage rights e. Deleted <Dec. 30, 2002> f. Development costs: Costs incurred in applying research results or related knowledge to create or significantly improve materials, equipment, products, processes, systems, or services prior to commercial production or use, which the business operator has recognized as development costs (including amounts paid by members of industrial technology research associations under the 「Industrial Technology Research Association Promotion Act」 to such associations for research and development and acquisition of research facilities). g. Value of donated assets for use and profit: The book value of assets donated other than cash, when such assets are used or profit is derived from such assets. h. Frequency usage rights and airport facility management rights: Frequency usage rights under Article 14 of the 「Radio Waves Act」 and airport facility management rights under Article 26 of the 「Airport Facility Act」. i. Other intangible assets similar to those in items a through h

A business operator may deduct depreciation expenses as necessary expenses by recognizing the accumulated depreciation amount without reducing the book value of the depreciable assets for each taxable period. In this case, the accumulated depreciation amount shall be recorded for each individual asset; however, if a depreciation expense adjustment statement under Article 73-2 is prepared and kept, the total amount of depreciation expenses may be recognized as the accumulated depreciation amount in a lump sum. <Amended Feb. 18, 2010>

The shortfall amount cannot be used to offset the disallowed depreciation amount of subsequent taxable periods.

When a business operator simultaneously applies depreciation and revaluation to depreciable assets, the depreciable scope amount shall be calculated assuming that depreciation was applied first, followed by revaluation.