MONDAY, DECEMBER 30, 2024
You moved abroad a few years ago but kept your home in Japan because you were unsure what the future held for you. But now, you’ve firmly settled abroad for the foreseeable future and are ready to sell your Japanese house. Or maybe you invested in Japanese property as a foreign national and you’re ready to sell. Will you owe tax when you sell Japanese property as a foreign resident
As a foreigner living overseas, the key to a successful property sale in Japan is choosing a reliable real estate agency with the expertise and experience in dealing with foreign clientele. Such real estate agencies proactively promote themselves on the Internet, so they should be fairly easy to find. Once you choose the real estate agent the agent can be a tax administrator. The tax administrator can file for the tax return for the seller as long as it’s a basic one.
When a non-resident sells property in Japan, to prevent the omission of report on income tax, the buyer has to pay a withholding tax equivalent to 10.21% of the transaction value. This means that the seller will not receive 100% of the sales price due to the deduction of the withholding tax. Note that payment of withholding tax is only required in the following cases:
・The transaction value is more than 100 million yen
・The buyer is using the property for a purpose other than their own personal residence
・The buyer is not a private individual
What are the reasons for people choosing to rent out their house instead of selling it through real estate agents?
A home is the biggest financial asset most people own, and deciding what to do with it shouldn’t be taken lightly. There are pros and cons to both options: For example, selling gets you a large windfall of cash all at once, while renting earns you smaller increments of steady monthly income from your tenants. If you have somewhere else to live and can afford to hang on to the house, renting it will also allow you to continue building equity as home values go up. Take a look at the following scenarios to determine which path is best for you.
Consult us if you have any questions regarding what to do for your current property.
We are well experienced and deep rooted Osaka real estate agents.
Koji Kitada
Licensed estate agent
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