Withholding tax when the seller is a non-resident

This information applies to:
  • Sellers who are non-residents (eg. foreigners living abroad and Japanese citizens living abroad).
  • Buyers, both local and overseas residents, who are buying real estate in Japan from a non-resident.

If the seller of Japanese real estate is a non-resident, depending on the situation, the buyer must withhold 10.21% of the sale price and pay it to the tax office, with the remaining 89.79% paid to the seller. The buyer is responsible for paying the 10.21% to the tax office by the 10th of the month following the transaction.

As a buyer: As a seller:
It is your obligation to make this payment to the tax office by the deadline. If you are currently living overseas, you will need to appoint a tax representative or accountant to pay this on your behalf. You will need to appoint a tax representative in Japan to file a final tax return to have the remainder returned to you (less any taxes that may have been owed).

Withholding Tax in Japan

*If the payment of deposits and mid-term payments also meet the conditions for withholding tax, the tax must be withheld and paid by the buyer at each payment.  

The above information has been provided as a general guide only. For more details on this tax, and for other detailed tax questions, please consult with the tax office or a specialist tax accountant.

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