What Are The Taxes Involved When Purchasing Property In Japan?
Are you having difficulty understanding the types of tax you need to pay when purchasing a property in Japan?
The following are the kinds of taxes you are required to pay when you buy a property in Japan:
①Stamp duty: Tax that is levied on documents
②Real-estate acquisition tax: Tax on the purchase of a property
③Registration license tax: For registering ownership transfer or mortgage on a property
You also need to pay the following taxes every year.
④Fixed asset tax: Levied on lands and buildings every year.
⑤City planning tax: People who own property in urban districts or city planning districts.
These taxes are the same taxes Japanese locals pay. Because the tax rate varies by region, please refer to the website of the local government in which your property is located for the specific amount of tax you have to pay. Calculating the total sum of taxes can be complex, so we recommend you consult a judicial scrivener or consult with a real estate company for accurate and easy numbers.
If you live abroad, you need to find a tax manager who can pay the tax on your behalf once you register him or her to the tax office. You also can choose a judicial scrivener as a tax manager. After acquiring the property, be sure to report the property’s purchase to the Ministry of Finance via Bank of Japan within twenty days.
Moreover, you must file an income tax report every year if you purchased a rental property. By calculating the total amount of tax you have to pay, you may receive a tax refund.
You can file an income tax report by yourself, but it would be much easier if you have a judicial scrivener or a certified public tax accountant do it for you.
If you are thinking of buying a property, be sure to include these taxes in your budget!
If you have any questions or would like to arrange a viewing, please feel free to contact us!