Please keep “Information for registration identification” (登記識別情報) safe.

Japanese business start-up consultant

Occasionally, people who cannot find their “Information for registration identification” are asking how they restore the document.

Information for registration identification is an important document that proves you have the ownership of the real property.
Unfortunately, it is not reissued at the Legal Affairs Bureau.

If there is a risk of theft, there is a procedure of invalidating the PIN code to let the Legal Affairs Bureau know.
However, even after invalidating the PIN code, Information for registration identification is not reissued. That is the system of Japan.

If the document are not found, strict identity verification is required when selling the real property, and the lawyer in charge of the sale will handle it to prove your identity, which normally incur an additional cost. The amount of the cost depends on the lawyer.

One of the best ways to store documents is at home in a safe or file box. If you don’t know which one is an important document, asking in person is the best thing to do.

I hope the information is useful.
I will update every Monday.
For more information
Japanese business start-up consultant
Shihoshoshi Lawyer
(Judicial Scrivener)
Akiko HORI

https://lawhelp4u.com/propertyJapan/

Estate and Succession planning – 1-1-1. How is Inheritance Tax calculated in Japan?

Japanese business start-up consultant

The Japanese Law, tax system and inheritance system shall prevail in this blog.
When proceeding this type of scheme, the case should be dealt with a tax accountant.

I previously promised in this blog about writing the calculation for the inheritance tax in Japan. In Japan, the Inheritance tax is a tax on beneficiaries, each heirs should file the inheritance tax return individually. However, generally speaking, legal heirs ask for this task to the same tax accountant. That’s why it looks as if legal heirs file the Inheritance tax return all together at once.

Firstly, the Inheritance tax in Japan will be incurred as shown below.

STEP 1: Calculation of the taxable gross estate, including the receivable amount of life insurance.

STEP 2: Debt deduction and other fees, such as a funeral ceremony fee.

STEP 3: Basic deduction. This is statutory deduction, and if the taxable gross estate is under this deduction, heirs should not need to declare the inheritance tax return.
30,000,000 Japanese Yen + 6,000,000 Japanese Yen x The number of heirs.

STEP 4: Calculation the total amount of inheritance tax assuming that the heirs divide the deceased person’s estate in a legal portion.

¥100,000,000 – ¥48,000,000 = 52,000,000

Ex.) 1. Taxable estate amount.

  Total estate

After Basic Deduction

Legal

portion

Acquired amount on the law basis
Spouse ¥ 52,000,000 × 2/4= ¥26,000,000
Child 1 1/4= ¥13, 000,000
Child 2 1/4= ¥13, 000,000
  1. Tax calculation

By using the table below, the amount of tax for each legal heir is calculated.

Table for deduction amount

Acquisition amount of

each legal heir (A)

Tax Rate (B) Deduction amount (C)
¥10,000,000 and under 10% ¥0
¥30,000,000  and under 15% ¥500,000
¥50,000,000  and under 20% ¥2,000,000
¥100,000,000  and under 30% ¥7,000,000
¥200,000 ,000 and under 40% ¥17,000,000
¥300,000,000  and under 45% ¥27,000,000
¥600,000,000  and under 50% ¥42,000,000
Over ¥600,000,000 55% ¥72,000,000

 

 

  Legally acquired amount (A)×(B)-(C)  
Spouse ¥26,000,000 ×15%- ¥500,000 = ¥ 3,400,000
Child 1 ¥13, 000,000 ×15%- ¥500,000 = ¥ 1,450,000
Child 2 ¥13, 000,000 ×15%-- ¥500,000 = ¥ 1,450,000
    Total Inheritance Tax ¥ 6,300,000

 

STEP 5: Proportional distribution the total amount of inheritance tax by the actual inheritance amount that each heir inherits. The Inheritance tax in Japan is calculated based on the actual received amount. If each legal heir get one-third of the estate, the actual inheritance tax ratio is shown below.

  Total Inheritance tax Actual receivable ratio  
Spouse ¥ 6,300,000 ×1/3 = ¥ 2,100,000
Child 1 ×1/3 = ¥ 2,100,000
Child 2 ×1/3 = ¥ 2,100,000
There is a Marital Deduction (Until ¥160,000,000) for the legitimate spouse in Japan. There are various types of deduction. Further consultation is needed.

The Japanese tax authority doesn’t recognise the joint account under the Common law because they always put their importance to the actual contribution to a married couple’s estate. Sometimes, this might lead to the mismatch of cross-border taxation.

 

It is so easy to make mistakes and, if there are any errors, this can cause problems after the death that will go on to create unintentional upset for the family. A good lawyer or tax accountant is likely to save money in the long term because we can deal with things quickly.

 

I hope the information is useful.

I will update every Monday.

For more information
Japanese business start-up consultant
Shihoshoshi Lawyer
(Judicial Scrivener)
Akiko HORI

Comprehensive Estate Planning

Japanese business start-up consultant

As for the current real property trend in Japan, the number of relatively large-scale real property investment projects by wealthy people in Asia has been increasing.

The aging population and the COVID-19 pandemic has affected the Japanese economy. The government should maximise savings through rapid rationalisation of the estate and the reuse of previously developed land. For example, restructuring public property stock and exploiting surplus government land and buildings contribute to economic growth.

https://www.mlit.go.jp/common/001229088.pdf

Since such cases are intricately connected to the legal issues, a project may not be possible unless the underlying Japanese legal system is understood.

I believe that it is even more important to look at the articles of the relevant laws and precedents with a fresh feeling, and keep up networking with peers and other professionals.

Even if a client is an alien, it is no different from normal work, but it is important to understand what they want to achieve because they might not fully understand the Japanese system and the roles of experts. Clients often talk on the premise of their own system, and it is necessary to explain the Japanese system plainly and clearly. The important thing is to carefully listen to what kind of business the client wants to do. Empathy is essential.

In addition, if the contents of their request is outside the scope of my work, connecting to appropriate specialists is necessary in order for a smooth business operation.

I hope the information is useful.
I will update every Monday.
For more information
Japanese business start-up consultant
Shihoshoshi Lawyer
(Judicial Scrivener)
Akiko HORI

 

https://lawhelp4u.com/propertyJapan/

Real property in Japan and Highly-Skilled Foreign Professionals

Regarding restrictions on foreign ownership of real property vary from country to country, but Japan is a country which falls into the unregulated category.

Up to now, with respect to the purchase of real property in Japan, the number of people who purchase real property in Japan has steadily increased because of the Tokyo Olympics and the weaker yen.
Popular options are to own apartments or commercial buildings in central Tokyo,  and resort properties in Niseko, Hokkaido.

In Japan, there are no restrictions on non-Japanese purchasing real property regardless of their immigration status, such as permanent residence, nationality, or visa type. The taxation for non-Japanese has no difference from the one for Japanese.

There is no time limit on owning real property, an owner can be freely bought and sold, and can be inherited. However, importantly the inheritance tax or estate tax should be considered.

In principle, there is no visa, such as Tier 1 investor visa (UK) or EB-5 Immigrant Investor Program (US). However, if you have a rental property in Japan with stable income, there is a possibility to be granted permanent residency under the “Highly-Skilled Foreign Professionals” system.

The problem would be a language barrier, but please feel free to contact me in English when buying or selling real property in Japan.

“Highly-Skilled Foreign Professionals”
(高度人材ポイント制)

JPN

http://www.immi-moj.go.jp/newimmiact_3/

ENG

http://www.immi-moj.go.jp/newimmiact_3/en/index.html

I hope the information is useful.
I will update every Monday.
For more information
Japanese business start-up consultant
Shihoshoshi Lawyer
(Judicial Scrivener)
Akiko HORI

https://lawhelp4u.com/propertyJapan/