As long as a tenancy lease is made out for a period of one month or longer, there is no legislation, visas or any other complications you need to be concerned about as an owner. There is no certification or agreement for either foreign or local landlords. 

Complications and hassles only arise if the lease is what’s called “minpaku”, which is defined by law as short-term leases of less than one month. For that matter, even if the tenant decides to move out mid-lease, and has stayed in the property for a shorter period of time, you would be well within your legal rights, since you made out a lease for a minimum term of one month.

Regarding taxes, you would need to legally declare your income for tax purposes, of course. Income tax is first billed in Japan, then the difference is billed in your country of residence. You might be tax-free in Japan due to the low-income stream in Japan, but you still need to report your income in your country of residence.

Your total Japanese income stream is taken into account as well as your tax situation in your country of origin. 

As a non-resident, you would be exempt from municipal and regional taxes. However, the fixed asset tax is applicable to all property owners. For properties less than 200 sqm in size, the tax would be around 0.75% to 1.5% of the property purchase price per annum.

For specific and accurate advice, it’s best to speak to an accountant in both countries regarding tax matters.

For more information about guidelines for non-resident landlords email Priti Donnelly of Nippon Tradings Japan via the contact details listed below. 

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