Taxes on Real Property

1.Taxes on acquisition of real property

(1)Real Property Acquisition Tax（不動産取得税）

Real property acquisition tax is levied on an newly acquired land / building at a rate of 4% (the rate is 3% for land and residential buildings acquired between April 1, 2003 and March 31, 2009; rates for other land/buildings depend on their acquisition date) .The tax base is the value for the fixed asset tax or similar thereto.

However,
the tax base for the certain land acquired during the period from January 1, 2003 to March 31, 2009 is one half of the land value. Acquisition of land or buildings by merger, spin-off or inheritance is non-taxable and acquisition of land and buildings for residential use has certain advantages of reduced tax.

(2) Business Office Tax（事業所税）

(a) Tax Payer
The enterprise which carries on business in the premises.

(b) Tax rate and tax exemption limit Asset levy:¥600 per １㎡of floor space (tax exemption limit 1,000 ㎡）
Employee levy: the total salary amount x 0.25% (tax exemption limit 100 employees)

(3)Registration and License Tax（登録免許税）
Registration and license tax is levied on registration of real property, companies, etc., with Registry
Offices. Typical rates are:

Registration Type		Tax Basis	Tax Rates
Initial registration of ownership		Assessed value used in Fixed Asset Tax for land and building(s)	0.40%
Registration of transfer of ownership	Inheritance		0.40%
	purchase sale etc. of land		2.0% (1.0%, until 2011March.31)
	purchase sale etc. of building(s)		2.00%
Establishment of mortgage		Amount of loan	0.40%

2. Stamp Duty（印紙税）
Stamp tax is paid by affixing and canceling a revenue stamp on the taxable documents which are are listed in the Stamp Tax Act.

Typical examples are:

Taxable Documents

Agreements for transfer of ownership of real property, intangible assets, aircraft and a business, loan agreements, agreements for contract work

Tax Base (Contract value)	Tax Amount (Per document)
Less than 10,000 yen	<Not taxed>
Up to 100,000 yen	200 yen
Up to 500,000 yen	400 yen
Up to 1 million yen	1,000 yen
Up to 5 million yen	2,000 yen
Up to 10 million yen	10,000 yen
Up to 50 million yen	15,000 yen
Up to 100 million yen	45,000 yen
Up to 500 million yen	80,000 yen
Up to 1 billion yen	180,000 yen
Up to 5 billion yen	360,000 yen
More than 5 billion	540,000 yen
No amount listed	200 yen

3.Tax on Holding of Real Property

(1)Fixed Asset Tax（固定資産税）Fixed asset tax is levied on land, buildings and depreciable assets for business use(hereinafter “fixed assets”) as of January 1 of every year. Fixed asset is levied, in principle, by the municipality where the fixed assets are located. The annual tax rate is 1.4% applied to the tax value of the fixed assets and tax payment must be made in April,July, December and February of the following year.

(2) City Planning Tax（都市計画税）City planning tax is levied on land and buildings in certain areas as a surtax to the fixed asset tax. The annual tax rate is 0.3% which applies to the tax asset value for fixed asset tax purpose.

-Related Links

“Taxes on Real Property”

“Taxes on Real Estate Income of Non-residents”

“Countries with Tax Treaties with Japan”

“Taxes on Trust Beneficiary Right of Real Estate”