Meeting expense is one of the expenses challenged as entertainment expense subject to limitation as income tax deductibles. For meeting expense at coffee shops and restaurants, always have your sales personnel write down the following items on the back of the receipt to substantiate the business purpose.
1. A list of the attendees
2. Group or association of each individual
If the above information is not kept properly, tax auditors in Japan will not hesitate to deem this transaction as salaries subject to withholding obligations. Please note that even if the above information is provided, the following elements provide room for the tax auditors to challenge as entertainment expense as well.
C) Amount Spent