Domestic and foreign real estate companies and investors have been busted by the Sapporo Regional Taxation Bureau for failing to declare income on realty transactions in Niseko.

Niseko has attracted local and foreign investors due to its skiing environment and proximity from other Asian countries. It also has the highest rate of growth in land values. 

The Bureau found about 10 cases where holiday home lands were sold without the income from the sale reported in the required tax fields, which totaled around 3 billion Yen.

With realty becoming popular, some foreign investors aren’t aware that even if they live abroad, dealings with Japanese property call for taxes. So if an entire transaction takes places overseas, this concept still applies.

An operation between Sapporo and Tokyo tax bureaus found companies registered in Hong Kong, Samoa and the British Virgin Islands did not declare 1.5 billion Yen in corporate tax.

It’s likely that tax bureaus will pay greater attention to offshore transactions in an attempt to curb this issue. 

Source: The Asahi Shimbun

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