Complete Japanese Real Estate Tax Guide
2025-06-05
1. Real Estate Acquisition Tax (不動産取得税)
A local tax levied once when acquiring real estate. For residential properties, the rate is 3% of the fixed asset tax assessment value (land is 1.5% until 2024 as a special measure). Newly built homes can receive deductions up to 12 million yen (13 million for long-term quality housing) under certain conditions. Land also qualifies for reductions if specific requirements are met.
2. Registration and License Tax (登録免許税)
A national tax paid when registering real estate ownership. Ownership transfer through sale is 2% of the fixed asset tax assessment value (0.3% with special measures). Mortgage registration is 0.4% of the loan amount (0.1% with special measures). Preservation registration for new buildings is 0.4% (0.15% with special measures).
3. Fixed Property Tax & City Planning Tax (固定資産税・都市計画税)
Local taxes imposed annually on property owners as of January 1st. Fixed property tax has a standard rate of 1.4% of the assessed value. City planning tax is levied up to 0.3% on properties in urbanization promotion areas. Residential land up to 200㎡ receives a special reduction to one-sixth of the tax amount.
4. Capital Gains Tax (譲渡所得税)
Tax on profits from selling real estate. Properties held 5 years or less are taxed at 39.63% (income tax 30.63% + residence tax 9%) as short-term gains. Properties held over 5 years are taxed at 20.315% (income tax 15.315% + residence tax 5%) as long-term gains. Primary residence sales qualify for a special deduction of up to 30 million yen.
5. Inheritance & Gift Tax (相続税・贈与税)
Taxes on inherited or gifted real estate. Inheritance tax applies progressive rates of 10-55% on amounts exceeding the basic deduction (30 million yen + 6 million yen × number of legal heirs). Gift tax applies 10-55% progressive rates after the annual 1.1 million yen basic deduction. The inheritance settlement taxation system can also be utilized for gifting.