Key Takeaways
- Fixed asset tax (固定資産税) is about 1.4% of assessed value; city planning tax (都市計画税) adds up to 0.3% in urban areas.
- Assessed value is typically 60–70% of market value and is recalculated every 3 years.
- Non-resident rental income is subject to 20.42% withholding tax on gross rent.
- Residential land gets a 1/6 tax reduction (first 200㎡) — but vacant houses designated under the Vacant House Act can lose it, raising tax up to 6×.
- Bills are mailed in April–May to your Japanese address; a tax representative (納税管理人) is required to receive and pay them from overseas.
If you own property in Japan, you are subject to annual property taxes regardless of where you live. This guide explains the key taxes, payment deadlines, and compliance requirements for non-resident owners in 2026.
Types of Property Tax in Japan
1. Fixed Asset Tax (固定資産税)
This is the primary property tax in Japan, assessed on all land and buildings. The standard rate is 1.4% of the assessed value (評価額), which is typically 60–70% of market value. The assessment is recalculated every 3 years.
2. City Planning Tax (都市計画税)
Properties within designated urbanization promotion areas (市街化区域) are also subject to city planning tax at a maximum rate of 0.3% of assessed value. Most urban properties in Tokyo, Osaka, and other major cities are subject to this tax.
3. Income Tax on Rental Income
If you rent out your property, rental income is subject to Japanese income tax. Non-residents are taxed at a flat rate of 20.42% on gross rental income (withholding tax). Your tenant or property manager is responsible for withholding this amount.
Payment Schedule (2026)
Property tax bills (固定資産税 and 都市計画税) are typically sent in April or May and paid annually as a lump sum.
| Tax | Rate | Notes |
|---|---|---|
| Fixed Asset Tax (固定資産税) | ~1.4% | Assessed on all properties |
| City Planning Tax (都市計画税) | Up to 0.3% | Properties in urbanization promotion areas |
Note: Exact dates vary by municipality. Tokyo 23 wards, for example, may have slightly different deadlines.
Special Exemptions and Reductions
- Residential land exemption — Land with a residential building receives a 1/6 reduction (up to 200m²) or 1/3 reduction (over 200m²) on fixed asset tax.
- New building reduction — New residential buildings may receive a 50% reduction on the building portion for 3–5 years.
- Vacant lot penalty — Since 2015, properties designated as 特定空き家 (specified vacant houses) can lose their residential land tax exemption, potentially increasing the tax by up to 6x.
Common Mistakes by Non-Resident Owners
- Not appointing a tax representative — tax notices cannot be delivered, leading to missed payments
- Ignoring small-municipality taxes — even rural properties have tax obligations
- Forgetting about vacant property risk — leaving a property vacant and unmaintained can trigger the vacant lot penalty
- Not claiming eligible exemptions — many owners miss the residential land reduction
Most of these mistakes trace back to not knowing what the law requires of non-resident owners in the first place — our FAQ on legal requirements covers the essentials.
How to Stay Compliant from Overseas
The simplest approach is to appoint a property management service that acts as your tax representative, receives all notices, pays taxes on time, and keeps you informed. Japan YES Property Management does exactly this — view our plans or get in touch. Curious how the setup works? Our getting-started FAQ walks through the required documents and timeline.
Frequently Asked Questions
What is the property tax rate in Japan?
Japan's primary property tax (固定資産税, fixed asset tax) is assessed at a standard rate of 1.4% of assessed value. Properties in urbanization promotion areas (市街化区域) also pay city planning tax (都市計画税) at up to 0.3%. Assessed value is typically 60–70% of market value.
How is Japan's fixed asset tax (固定資産税) calculated?
Fixed asset tax is 1.4% of the assessed value (評価額), which is recalculated every three years. Residential land benefits from a 1/6 reduction (up to 200m²) or 1/3 reduction (over 200m²), making land under family homes significantly cheaper to hold.
When is Japanese property tax due?
Property tax notices are typically sent in April or May. Payment can be made in installments across the year, with the schedule varying by municipality. Non-residents need a tax representative to receive the notice and pay on their behalf.
Can a vacant property in Japan face higher property tax?
Yes. Since 2015, properties designated as 特定空き家 (specified vacant houses) under the Vacant House Special Measures Act lose their residential land tax exemption, potentially increasing fixed asset tax by up to 6 times. Regular maintenance and professional management prevent this designation.
Sources
This article is based on official Japanese government information.
About the author
Yuichi Suzuki（鈴木 裕一）
Founder, Japan YES Property Management · Licensed 宅地建物取引士 (Saitama No. 087841) · Keller Williams Saitama agent
Yuichi helps overseas owners run their Japanese property from abroad — tax representative filings, mail scanning and translation, bill payments and coordination with local companies, in English and Chinese.
Company overviewPurchased Japanese Property from Overseas? Let Us Handle the Management.
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