The Three Tax Representatives Every Non-Resident Owner Needs

Once the title is in your name, three different levels of government start sending you bills, and each of them keeps its own register of who to send them to. If you live outside Japan, those bills have nowhere to go, and Japanese law deals with that by requiring you to appoint someone here to receive them. That person is your tax representative. What almost nobody tells a foreign buyer is that you appoint one three times, with three different offices, because the three taxes belong to three different governments.

Getting this right is the single most useful piece of admin a non-resident owner does. Here's the whole of it.

What the role actually is

A tax representative is registered with a tax authority as the person who receives your notices and pays them on your behalf. The bills are addressed to them, in Japanese. They pay, or forward the amount to you and pay, and the authority has someone in Japan it can reach about your property.

That's the whole job. The representative is not your lawyer, not your accountant and not liable for your tax. They're the letterbox and the hands.

The three appointments

Municipal: fixed asset tax and city planning tax. The annual property tax, billed by the city or town where the house sits. This is the one everybody has heard of. The appointment is filed with the municipality's tax division on its own one-page form. Two properties in two different towns means two of these.

Prefectural: real estate acquisition tax. The one-off tax on buying property, billed by the prefecture some months after settlement. It comes from a different government with a different register, so the municipal appointment does nothing for it. This is the appointment that most often gets missed, and the bill then arrives at an empty house. It's filed with the prefectural tax office covering the property.

National: income tax. If you earn rental income in Japan you must file a return, and a non-resident filing from overseas appoints a representative with the national tax office to handle the filing, the correspondence and any refund. It uses the same Japanese term as the other two, which is exactly why people assume one appointment covers everything. It doesn't. This one is filed with the tax office for the area.

Three governments, three registers, three forms, three offices. The same person or company can hold all three, and for owners on our annual representation that's what we do.

Who needs them

Every owner of Japanese property who does not have an address in Japan. It doesn't matter whether you're Japanese or foreign, whether the property is a holiday house or an investment, or how cheap it was. The municipal and prefectural appointments apply to every owner. The national one applies once there's Japanese income to declare.

If you move to Japan later, you cancel them. If you sell, they lapse with the property.

Who can do it

Anyone with a Japanese address, individual or company. A resident friend or relative is the traditional answer and it works perfectly well if that person is reliable, will be there for years, and doesn't mind receiving official mail and handling a bank transfer a few times a year. Plenty of our clients go that route and we'd never talk them out of it.

The reasons people use a professional instead are the obvious ones: no suitable friend, a friend who moved away, or not wanting to owe a favour every year for the life of the property. Our annual representation covers the appointments for ¥60,000 a year across up to three properties, with each property beyond three adding ¥10,000. For owners who didn't purchase through us it's ¥70,000 for the first year, then ¥60,000. That fee also covers a domestic mailing address for all your official correspondence, setting up and paying the utilities, and the administrative side of an annual tax return if you have rental income. We don't charge consumption tax on it.

How they're filed

Each is a one-page form. The municipal and prefectural versions ask for the same things: the owner's name and overseas address, the property, and the representative's name, address, occupation and phone number. The representative signs to accept. There's no fee, no hearing and no approval process beyond the office stamping the form. The national one is lodged with the tax office and works the same way.

For owners on our annual representation, we file all three: the municipal and prefectural appointments straight after settlement, timed so they're in place before the first bill, and the national one when there's rental income to declare. That applies whether you bought through us or through someone else. Purchase clients who'd rather keep it separate are free to: a friend in Japan can hold the appointments, and an accountant handling your Japanese tax return will often bundle them. Whoever does it, file the first two in the month after settlement. The acquisition tax notice can arrive before the first regular property tax bill, and you want it landing on your representative's desk rather than the doormat of an empty house.

The fourth thing, which is not a tax matter at all

Since April 2024, an owner without a Japanese address must also have a domestic contact recorded on the property register itself, at the Legal Affairs Bureau. This is a name and address on the title, and it exists so the authorities have someone in Japan they can reach about the property. It's registered through the Legal Affairs Bureau, usually by the judicial scrivener at the time of purchase, and it has nothing to do with the three tax appointments. Whoever you name has to remain reachable for as long as they're on the title, so it's normally the same person who holds your tax appointments, and if that arrangement ever ends, with a friend who moves away or a management service you leave, the contact on the title needs changing too. It's a small registration, but it's one people forget.

The same person or company can be all four, and for owners on our annual representation we are. But if you're arranging things yourself, don't assume that having one means you have the others.

What the bills look like

Fixed asset tax is 1.4 percent of the government-assessed value of the land and building, plus around 0.3 percent city planning tax in designated urban areas. Assessed values on older houses sit well below market price, so the annual bill on the sort of property our clients buy is usually modest. On a ¥7 million purchase we completed this year the annual bill is about ¥107,000; on many older rural houses it's under ¥30,000. The notice arrives in April to June with payment slips for four instalments or a single lump sum.

Real estate acquisition tax is 3 percent for residential property and 4 percent for non-residential, on the assessed value rather than the price, with reductions that often apply to older homes and residential land. It arrives once, by post, typically about six months after purchase.

Both notices are entirely in Japanese. Our clients receive a plain-English summary and a statement showing what was paid and when.

If you rent the property out

Rental income earned in Japan is taxable in Japan, at progressive rates starting at 5 percent on the net figure after expenses, filed by 15 March each year. That's what the national appointment is for. Where your tenant is a company, 20.42 percent of the gross rent is withheld at source and credited against your return; an individual living in the house as a residence generally doesn't withhold.

We provide the administration for that annual return on our annual service, and we're plain about the limit of it: we are not tax accountants, and an owner with a complex position needs one.

What goes wrong when it's skipped

The honest list, from watching it happen:

The bills go to the empty house. Nobody pays them. Late-payment charges accrue. The office sends reminders, also to the empty house. Eventually a demand arrives, sometimes by way of the neighbour who finally opens the letterbox, and the owner discovers a year of arrears plus penalties and an office that is, understandably, unimpressed. The acquisition tax is the usual culprit, because the buyer appointed a representative with the town and assumed that was that. Untangling it from overseas costs more in time and goodwill than five years of a representative would have.

None of this is dramatic and none of it is hard to avoid. Make the three appointments in the first month, make sure the representative knows what they're receiving, and it never becomes a problem.

In short

If you live outside Japan and own property here, you need a tax representative registered with the municipality, another with the prefecture, another with the national tax office if you have rental income, and a domestic contact recorded on the title. A friend can do all of it for free. We do all of it, plus a mailing address and the utilities, for ¥60,000 a year. Either way, get it done before the first bill arrives. Ask us about annual representation, or see everything it covers. Already own a property and need someone on the ground? That's a page of its own.