It’s mid-October. If you’re a freelancer or sole proprietor in Japan, you probably have a pile of receipts somewhere: an envelope, a drawer, a tote bag. It has been growing since January. Filing season for the tax return (確定申告) is still a few months away, so the pile hasn’t felt urgent yet. That changes fast in February.

This post is about Reshito, the AI receipt scanner we built at BenStay. The first half is about the backlog itself and how to clear it, whatever tool you use, because the method matters more than the software.

TL;DR

  • A receipt backlog is a data-entry problem: each receipt needs its date, payee, amount and tax treatment recorded before it is useful for filing.
  • Under the invoice system (インボイス制度), which started in October 2023, taxpayers using general taxation generally need qualifying books and invoices to claim the consumption-tax input credit. The issuer’s registration number is one of the required invoice elements. Eligible purchases from unregistered suppliers can still get a transitional credit: 80% through September 30, 2026, and 70% from October 1, 2026 through September 30, 2028. Certain eligible transactions under ¥10,000 also fall under a small-amount exception through September 30, 2029.
  • Under the electronic bookkeeping law (電子帳簿保存法), receipts you received digitally generally have to stay digital. The search requirements have exemptions. For example, a business with base-period sales of ¥50 million or less is exempt from them if it can provide the data for download when tax officials ask.
  • Blue-return (青色申告) books and documents generally have to be kept for seven years, but certain supporting documents have a five-year period. Keeping everything for seven years can be a conservative way to organize, so anything you build should still be usable years from now.
  • Reshito lets you photograph a receipt. AI then extracts the date, payee, amount and tax rate, and sorts the expense (経費) into a category.

Why Does a Receipt Backlog Get So Painful?

A backlog hurts because every receipt needs the same four or five facts pulled out by hand, and receipts in Japan come in every format you can think of. You’ll find thermal convenience-store slips, handwritten 領収書 from small shops, hardware-store printouts with dozens of lines, and PDFs from online services. Each one puts the date, the shop name, the total and the tax breakdown in a different place.

Doing one is trivial. Doing three hundred in one sitting in February is miserable, and that’s when mistakes creep in: a transposed digit, a skipped receipt, an 8% item filed as 10%.

The rules add another layer. Under the invoice system, taxpayers using general taxation generally need qualifying books and invoices for the full input credit, and the registration number is one of the invoice’s required elements. Purchases from unregistered suppliers may still qualify for the transitional credit, and the small-amount exception covers some transactions. Under the electronic bookkeeping law, a receipt that arrived digitally, such as an emailed PDF, generally has to be kept as electronic data. Printing it and filing the paper isn’t a substitute. Ordinary compliance also means taking an anti-tampering measure, such as adopting and following written procedures that prevent corrections and deletions, and being able to display and print the records. Whether the search requirements apply depends on your sales and situation.

Paper receipts are a separate case. A scan or photo can replace the paper original only if you meet all of the scanner-storage requirements. Those include image quality (for receipts, at least 200 dpi-equivalent resolution and 24-bit color), controls on corrections and deletions, a link to your accounting records, searchability and readable output. They also include a timestamp, or an accepted method of proving the image was stored within the required period. Ordinary receipts generally have to be scanned within about seven business days of receipt, or within an established processing cycle of up to two months plus about seven business days.

So the real job is building an organized, consistent ledger, not just getting the shoebox emptied.

How Can You Clear the Backlog Without Any Special Tool?

Split the work into short batches and give every receipt the same fields. Here’s a method that works with nothing more than a spreadsheet:

  1. Sort by month first. Don’t enter anything yet. Just put the receipts into twelve piles. This shows you how big the job is and gives you natural stopping points.
  2. Fix your columns. Use date, payee, amount, tax treatment, whether a registration number is printed, category, and a link or filename for the stored image. Tax treatment should allow taxable 8%, taxable 10%, exempt and outside-scope, as applicable. Insurance premiums, for example, are generally exempt rather than taxed at 8% or 10%. If a receipt mixes rates, split it into separate rows (or separate amount and tax columns for each rate) linked to the same receipt. Keep the same columns all year.
  3. Photograph or save every receipt as you enter it, and keep the paper. Name the file after the date and payee so you can find it again. Photographing the backlog for data entry is fine, but keep the originals. These receipts arrived before you adopted scanner storage. To replace them with electronic records, you must first submit the scanner-storage notification for past important documents (過去分重要書類) in advance and meet the applicable requirements.
  4. Separate digital receipts. Emailed invoices and PDF receipts generally have to stay digital. Put them in one folder, never print them in place of keeping the original file, and write down and follow a simple procedure for preventing corrections and deletions.
  5. Do one month per sitting. Thirty receipts a night is manageable. Trying to process three hundred in one weekend can be exhausting.
  6. Flag anything doubtful instead of guessing, for example a receipt with no registration number or a mixed 8%/10% total you can’t split. Then ask your tax accountant (税理士) about the flagged pile in one go.

At 30 receipts per session, a 300-receipt backlog takes ten sessions. Schedule those sessions before December, and keep processing new receipts as they come in.

What Did We Build, and How Does It Work?

Reshito is an AI receipt scanner for Japanese freelancers and sole proprietors. You photograph a receipt. The AI reads the date, payee, amount and tax rate, then sorts the expense into a category, so you have structured records ready for tax filing and for working under the invoice system.

We built it because steps 2 and 3 above (typing in the fields and filing the image) are where all the time goes. Our own operation produces a steady stream of receipts: cleaning supplies, replacement linens, small repairs, train fares to properties. Sorting them was never hard. Typing them in was. AI can reduce manual typing, but the time saved depends on image quality and the corrections required.

With Reshito, the batching method above still applies. You still sort by month and still work in small sessions. But each receipt becomes “take a photo, check the result” instead of “read, type, double-check, rename the file.” Keep in mind that AI extraction on its own doesn’t make your storage compliant: the scanner-storage and electronic-storage requirements above still apply.

Where Does Reshito Fit, and Where Doesn’t It?

Reshito fits best if you’re a freelancer or sole proprietor with a steady flow of paper and mixed-format receipts who wants help with data entry. If your backlog is mostly crumpled slips from many different shops, that’s the case we designed it for.

It’s honestly less useful in a few situations:

  • You have only a handful of receipts a year. A spreadsheet and ten minutes a month is perfectly fine.
  • Your expenses are almost all card or bank transactions that your accounting software already imports. If your software already imports payment data, you may need less manual entry. You still need to reconcile the entries and keep the required supporting documents. Card-company statements generally don’t count as invoices for the input credit themselves, subject to applicable exceptions.
  • You need someone to make judgement calls. Whether an expense is deductible, how to split personal and business use (家事按分), or what to do about a receipt with no registration number are questions for you and your tax accountant. Reshito categorizes expenses, but it doesn’t replace professional advice.

You should also check what the AI extracted, especially on faded thermal paper or handwritten receipts. It’s still your ledger and your return.

If that sounds like your pile, you can try it at reshito.jp.

FAQ

Q: When should I start clearing my receipt backlog for the tax return?

As soon as you can, ideally in autumn. At 30 receipts per session, a 300-receipt backlog takes ten sessions. If you schedule them from October and keep up with new receipts, you’ll have time before filing season to ask your accountant about doubtful items.

Q: Can I photograph paper receipts instead of keeping the originals?

A photograph can replace the paper original only when you meet all of the scanner-storage requirements. Otherwise, keep the paper. The requirements include image quality (at least 200 dpi-equivalent and 24-bit color for receipts), controls on corrections and deletions, a link to your accounting records, searchability and readable output. They also include a timestamp or an accepted method of proving storage within the required period. Receipts you got before adopting scanner storage also need the advance notification for past important documents. Receipts you received digitally generally have to stay digital. AI extraction alone doesn’t make storage compliant, so check the details with a tax professional.

Q: Does Reshito decide whether an expense is deductible?

No. Reshito extracts the date, payee, amount and tax rate and puts the expense into a category. Whether a specific expense is deductible, and how much, is a judgement for you and your tax accountant.

This post is for informational purposes only and does not constitute legal or tax advice. Please consult a qualified professional for your specific situation.