Who is liable? Japanese property taxed even for non-residents
Essential starting point: real estate located in Japan is a Japanese asset. For Japanese inheritance tax (sōzokuzei, sōzoku-zei), the location of the property prevails. Even if the deceased and the heir never lived in Japan, passing on an apartment or house located in Japan falls within the Japanese tax base.
The general rule:
- For a deceased and heirs who are non-resident with no recent Japanese residence link, Japanese tax in principle covers only Japan-situated assets (including real estate), not worldwide wealth.
- Residence status, nationality and Japanese-stay history can alter the scope of the base (worldwide vs Japanese assets) — hence the importance of a specialised zeirishi (zeirishi, tax accountant).
In other words: buying a property in Japan eventually creates Japanese inheritance-tax exposure for your heirs. Anticipate it from purchase, just like the annual property tax and, on resale, the capital gains tax. This article gives the landmarks; it does not replace personalised advice.
The basic deduction: ¥30M + ¥6M per heir
Before any tax, the estate benefits from a basic deduction (kiso kōjo, kiso kōjo). Its formula is simple and central:
Deduction = ¥30,000,000 + (¥6,000,000 × number of legal heirs)
That is a ¥30M base (≈ €200,000) increased by ¥6M (≈ €40,000) per legal heir. Only the portion of the estate above this deduction is taxed.
Deduction examples by number of heirs
| Number of legal heirs | Calculation | Total deduction |
|---|---|---|
| 1 | ¥30M + ¥6M | ¥36M (≈ €240,000) |
| 2 | ¥30M + ¥12M | ¥42M (≈ €280,000) |
| 3 | ¥30M + ¥18M | ¥48M (≈ €320,000) |
| 4 | ¥30M + ¥24M | ¥54M (≈ €360,000) |
In practice, a small property at ¥20-30M passed to several heirs can fall below the deduction and trigger no tax. A higher-value property exceeds the deduction and becomes taxable on the excess. Other specific deductions (spouse, etc.) exist and fall to the zeirishi.
The progressive scale: from 10% to 55%
Above the deduction, the tax follows a progressive bracketed scale, applied to the taxable share allotted to each heir (after statutory apportionment). Rates run from 10% to 55%.
Indicative inheritance-tax scale (sōzokuzei)
| Taxable share per heir | Rate | Deduction |
|---|---|---|
| ≤ ¥10M (≈ €67,000) | 10% | 0 |
| ≤ ¥30M (≈ €200,000) | 15% | ¥0.5M |
| ≤ ¥50M (≈ €333,000) | 20% | ¥2M |
| ≤ ¥100M (≈ €667,000) | 30% | ¥7M |
| ≤ ¥200M | 40% | ¥17M |
| ≤ ¥300M | 45% | ¥27M |
| ≤ ¥600M | 50% | ¥42M |
| > ¥600M | 55% | ¥72M |
The actual calculation runs in several steps (net base, apportionment by statutory shares, applying the scale, then re-apportioning by the effective division). This table is a landmark; the final calculation belongs to a zeirishi (zeirishi).
Property valuation: the tax value, not the market price
An often-misunderstood point: the taxable base is not the market price, but a tax value, generally lower.
Land: the rosenka value (rosenka)
Land is valued from the rosenka (rosenka, value per metre of street frontage), published yearly by the tax authority (Kokuzei-chō). This value is typically below the market price (often around 80%), which lowers the taxable base accordingly.
Building: the assessed value
The structure is valued at its assessed value (kotei shisan zei hyōkagaku, kotei shisan-zei hyōka-gaku), also below the rebuild or sale price.
As a result, the value taken for inheritance tax is often markedly lower than the purchase price. This is precisely why real estate is sometimes used in Japan as an estate-planning tool — a use that strictly requires professional advice. To place tax value against real price, cross-check the rosenka with Japan property price trends in 2026.
France-Japan treaty and gifts: avoiding double taxation
If you are a French tax resident with a property in Japan, two inheritance-tax systems can cross. This is where the France-Japan tax treaty comes in.
The treaty on inheritance
France and Japan have a treaty designed to avoid double taxation. In practice, real estate is taxable in the State where it sits (Japan), and a credit mechanism in principle avoids paying the same tax twice on the French side. Coordinating the two regimes is technical: joint support from a zeirishi (zeirishi) in Japan and a notaire/tax adviser in France is strongly recommended.
Gifts (zōyozei, zōyo-zei)
Transferring during your lifetime falls under gift tax (zōyozei, zōyo-zei), separate from inheritance, with its own (also progressive, up to 55%) scale and a much smaller annual allowance (around ¥1.1M/year, ≈ €7,300). Specific regimes (e.g. early transfer) exist. Here too, the gift-vs-inheritance trade-off is made with a professional.
Common mistakes to avoid
- Believing a Japanese property escapes Japanese tax because you live abroad: false.
- Confusing market value with tax value (rosenka): it is the latter that counts.
- Forgetting to appoint a tax representative in Japan for the estate formalities.
- Improvising a gift without weighing the zōyozei scale or the treaty.
In short: anticipate, value, seek advice
Inheritance tax on a Japanese property (sōzokuzei, sōzoku-zei) follows a clear logic: the Japanese property is taxable even for non-residents, a basic deduction (¥30M + ¥6M per heir) shields small estates, and the excess follows a progressive scale of 10 to 55%, applied to a tax value (rosenka) often below the market.
The France-Japan treaty in principle avoids double taxation, and the gift route (zōyozei, zōyo-zei) offers an alternative to frame carefully. Given the technicality — base, statutory apportionment, treaty, gift/inheritance choice — this topic requires professional advice: a zeirishi in Japan and a tax adviser/notaire in France. To structure your Japanese property project with succession in mind from the purchase, lean on our personalised support and also anticipate the non-resident's tax on rental income during ownership.
Frequently asked questions
Does a non-resident pay inheritance tax on a Japanese property?
Yes. Real estate located in Japan is a Japanese asset and falls within the Japanese inheritance-tax base (sōzokuzei, sōzoku-zei), even if the deceased and heirs live abroad. For non-residents, the tax in principle covers only Japan-situated assets. A zeirishi (zeirishi) confirms the scope of the base depending on the situation.
What is the inheritance-tax deduction in Japan?
The basic deduction (kiso kōjo, kiso kōjo) is ¥30M (≈ €200,000) plus ¥6M (≈ €40,000) per legal heir. With 2 heirs the deduction reaches ¥42M; with 3, ¥48M. Only the estate share above this deduction is taxed, on a 10 to 55% scale.
How is a property valued for Japanese inheritance tax?
Not at market price, but at a generally lower tax value. Land is valued at the rosenka (rosenka, tax value per metre of frontage, published by the authority, often ~80% of market) and the building at its assessed value (kotei shisan-zei hyōka-gaku). The taxable base is therefore often well below the purchase price.
Does the France-Japan treaty avoid double taxation?
Yes, in principle. Real estate is taxable in the State where it sits (Japan), and the treaty provides a mechanism to avoid paying the same tax twice. Coordination is technical: get support from a zeirishi (zeirishi) in Japan and a notaire/tax adviser in France.
Is it better to give during your lifetime (gift) or transfer by inheritance?
It depends. A gift falls under zōyozei (zōyo-zei), with its own progressive scale (up to 55%) and a much smaller annual allowance (~¥1.1M/year). Inheritance benefits from the ¥30M + ¥6M/heir deduction. The trade-off depends on the property's value, timing and family situation: decide it with a professional.
Official sources
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