Questions are good
Due diligence, due diligence, due diligence
When purchasing a property in Japan there are a number of taxes that are required to be paid at JNW Properties. We have outlined below what is required as a buyer and seller; however we recommend employing an expert in this before purchasing.
Purchase tax
Acquisition Costs approximately 2% - 3% of the purchase price. Payable on completion
Income tax on rental income generated is 5% - 45%, depending on amount of net rental income
Holding costs include Fixed Asset Tax and City Planning Tax which is approximately 0.4 to 0.6% per annum.
Consumption Tax
10% of purchase price - normally included in the sale price however it is becoming more common to not include in the sale price of the property, so be aware of this when purchasing. There are circumstances when it is possible to claim this back but you should get expert advice regarding this.
Capital Gains Tax (on disposition)
30% before the first January after 5 years of ownership
15% from the first January after 5 years of ownership
Check out our free 10-steps to purchasing property in Japan
*For further details on tax, please contact the recommended tax advisor
Purchasing property is very straightforward in Japan and as foreigners can own 100% freehold in their own name then the only worry is making sure you purchase the right property for you.
Select your preferred plot of land, house or apartment
Pay a HK$20,000 reservation fee - this freezes the price, takes the property off the market and allows time to complete due diligence
Make a 10% down payment upon signing of sales and purchase contract after 14 days
Pay the 90% balance within 4-6 weeks
See our guide - 10-steps to purchasing property in Japan