A comprehensive guide to the process and taxes for foreigners buying a home in Japan
- 代表：日野ミカエル大輔
- Nov 27, 2024
- 4 min read
A guide to the process and taxes for foreigners buying a home in Japan
Step 1: Decide on a real estate agency!
If you want to buy a house, the first step is to find a reliable partner - a real estate agency! There are many real estate agencies that cater to foreigners.
🌟 wagaya Japan (English, Chinese, Korean, Vietnamese available) 🌟 Mitsui Fudosan Realty (English and Chinese available) 🌟 Best Estate.jp (Not only English, but also Portuguese!) 🌟 Global Trust Networks (Multilingual for peace of mind!) 🌟 realestate.japan (A lifesaver when searching for properties!)
Choose the company that's best for you based on your purpose and the area you live in. If you're unsure, we're here to help!
Step 2: The purchasing process is super simple!
🏡 1) Find a property!
Research your ideal property while consulting with a real estate agency. You can also check out properties that suit your taste online and make a list!
✍️ 2) Expressing your intention to "buy!"
Once you have decided on the property you want to buy, submit a "Proof of Purchase". It's like saying "I want this house!", but it's not mandatory yet, so don't worry!
💰 3) Are you prepared with money?
If you pay in full, it's smooth, but if you want to take out a loan, you'll need to do a little preparation.
If you have permanent residency, it's easier to get a loan!
Having a down payment will give you even more peace of mind!
🖋 4) Sign the contract and pay the deposit!
When you sign the contract, you pay a deposit (usually 5-10% of the property price). After that, you all get together to go through the registration procedures, and the house will be in your name!
Step 3: Here's how much it will cost to buy a house!
If you own a home in Japan, you will incur the following taxes and fees:
💸 1) Real estate acquisition tax
Tax is levied when you acquire real estate. The tax is roughly 3-4% of the property price.
📝 2) Registration and License Tax
This is a tax levied during the registration process. It is roughly 0.15-0.4% of the assessed value of the property.
🏠 3) Consumption Tax
Land is tax-free, but buildings are subject to consumption tax. However, if you buy from an individual, you may not be taxed!
📄 4) Stamp Duty
The stamp fee to be affixed to a contract. It varies depending on the amount, but there are cases where you can save a little by taking mitigation measures!
🛠 5) Property Tax
Taxes paid annually. The standard is 1.4% of the assessed value, but this can vary depending on the municipality.
🏙 6) City Planning Tax
A tax to keep the city clean. The maximum amount is 0.3% of the assessed value.
About Nōzei Kanrinin
In Japan, a "Nōzei Kanrinin" (納税管理人) is a tax agent or a representative appointed to handle tax-related matters on behalf of a foreigner or non-resident who owns property in Japan. The role of a tax representative is crucial for foreigners who do not reside in Japan, as they may not be familiar with or able to navigate the Japanese tax system.
Key Points About Nōzei Kanrinin:
Purpose:A Nōzei Kanrinin is appointed to ensure that taxes, such as property taxes and other relevant taxes, are paid correctly and on time for a foreign property owner. The tax representative acts as a liaison between the foreigner and the Japanese tax authorities.
Who Needs One:Foreigners or non-residents who own property in Japan are required to appoint a tax representative. This is particularly necessary for those who do not live in Japan, as they may not be able to receive tax notifications or deal with the tax authorities directly.
Responsibilities:The Nōzei Kanrinin handles various tasks, including:
Receiving and responding to tax notices from the Japanese tax office.
Ensuring payment of taxes such as property tax (固定資産税, koteishisanzei) and other local taxes.
Acting on behalf of the property owner in tax-related matters.
Appointment Process:To appoint a tax representative, the foreign property owner needs to submit a formal notification to the local tax office. The representative must be a resident of Japan (such as a lawyer, accountant, or a real estate agent) and should be familiar with Japanese tax law.
Benefits:Appointing a Nōzei Kanrinin ensures that all tax obligations are met, preventing any legal issues related to unpaid taxes. It also simplifies communication with the Japanese tax authorities, which can otherwise be challenging for non-residents who do not speak Japanese.
Legal Requirement:In Japan, it is legally required for non-resident property owners to appoint a Nōzei Kanrinin. Failure to do so can result in difficulties in managing taxes and could even lead to penalties or legal complications.
Overall, the Nōzei Kanrinin serves as a vital tool for foreign property owners in Japan to stay compliant with tax regulations and ensure that their property investment does not face unnecessary complications.
American Life Real Estate provides full support!
Buying a property can be a bit of an adventure, but don't worry! We're here to help you with multilingual support✨
In addition, we also provide free Tesla pick-up and drop-off services and advice on taxes and loans. Let's enjoy the search for your ideal home together!
Please feel free to contact us anytime! Why not enjoy your home search with American Life Real Estate?
Please refer to the National Tax Agency website.
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