Understanding Japan’s real estate tax system is crucial for making informed investment decisions. While the system may seem complex at first, having a clear grasp of the basics can save investors from unexpected expenses.
Key Real Estate Taxes in Japan
Acquisition Tax: A one-time tax imposed on property buyers, typically around 3-4% of the property’s assessed value.
Property Tax: An annual tax based on the property’s fixed asset value, with rates generally around 1.4%.
City Planning Tax: An additional tax in urban areas, typically 0.3% of the property’s value.
Registration and Licensing Tax:Paid during the property registration process, ranging from 0.4% to 2% of the property’s value.
Capital Gains Tax: Applies to profits from selling property, with rates differing based on ownership duration.
Tax Incentives for Foreign Investors
Depreciation Deductions:
Foreign investors can claim deductions for property depreciation, reducing taxable income.
Double Taxation Treaties:
Japan has treaties with many countries to prevent double taxation on property income.
How to Stay Tax-Compliant
Working with a tax professional is essential to navigating Japan’s tax system and maximizing incentives.
How Old Houses Japan Assists Investors
Our team connects you with tax advisors and provides insights into tax-efficient property investments, making the process stress-free for foreign buyers.
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