Rental Income Tax for Overseas Owners in Japan: 20.42% Withholding, Tax Returns and Tax Agents

Published2026.11.028 min read

If you live outside Japan and let a property in Japan, your tax treatment differs from a resident landlord. The biggest difference: depending on the tenant, 20.42% of the rent may be withheld at source. Use the checker to see what applies to you, then read about withholding, tax returns and tax agents, based on National Tax Agency materials.

Key points

WithholdingIf the tenant is a company, a business or a sublease company, the tenant withholds 20.42% of rent
ExemptAn individual renting a home for themselves or their family does not withhold
Tax returnFile every year for Japanese real estate income; withheld tax is settled in the return
Tax agentAppoint one and notify the tax office to file returns and receive documents

Check your situation

Who is a “non-resident”?

For tax purposes, a non-resident is an individual with no domicile in Japan who has not had a residence in Japan for one continuous year or more. Nationality does not matter: a Japanese national posted abroad for a year or more is generally a non-resident after leaving. A company without a head office in Japan is a foreign corporation. ※1 ※2

Withholding on rent (20.42%)

Anyone who rents property in Japan from a non-resident or foreign corporation and pays rent in Japan — companies and individuals alike, whether or not in business — must withhold 20.42% income tax and special reconstruction income tax. The exception: an individual renting for their own or their relatives’ home. ※3

Tenant	Withholding	Example
Individual (own/family home)	Not required	Ordinary residential tenant
Individual (business use)	Required	Sole trader renting a shop or office
Company	Required	Company housing, offices
Sublease company	Required	Master lease (sublease) contracts

When the landlord is a non-resident or foreign corporation. ※3 ※4

Deadline: by the 10th of the month after payment (end of the following month if the payer is in Japan but pays abroad) ※3
From 2027: a special defence income tax is added to the breakdown; the published rate for rent remains 20.42% ※3 ※5
Tax treaties: most allow the country where the property is located to tax rent, so Japanese withholding applies ※3

	Amount
Monthly rent	150,000 yen
Withheld (150,000 yen × 20.42%)	30,630 yen
Owner receives	119,370 yen
Withheld per year	367,560 yen

Company housing and subleases: the tenant is a company, so withholding applies whoever lives there
Owner moved abroad or sold to a foreign buyer: rent paid after the change is subject to withholding ※4
Not withheld: a tenant who paid the tax without deducting it can deduct it from later rent or claim it from the landlord ※4

Tax return

Income from letting property in Japan must be reported in a tax return even by non-residents (if it exceeds total deductions). File between 16 February and 15 March of the following year; withheld tax is credited and any overpayment refunded. Main expenses include management fees, repairs, property tax, insurance, depreciation and loan interest. The basic deduction is available to non-residents. ※2

Tax agent (nozei kanrinin)

A non-resident who needs to file returns, receive tax office documents or pay or receive refunds must appoint a tax agent and submit the appointment notification to the tax office. The agent can be a company or an individual. Local taxes such as property tax may also require notifying the metropolitan tax office or city office. ※1 ※2

FAQ

If a management company collects the rent, who withholds?

The payer (tenant) withholds. If the management company only collects on the landlord’s behalf and the tenant is an individual renting their home, no withholding is needed. In a sublease, the management company is itself the tenant and withholds. ※3

Do I get the withheld tax back?

It is settled in your tax return; if withheld tax exceeds the tax due after expenses and deductions, the difference is refunded.

Is consumption tax charged on residential rent?

No. Rent for housing (let for one month or more) is exempt; rent for shops and offices is taxable.

Managing your Japanese property from abroad

MYHOUSING manages properties for overseas owners from one unit: rent collection, statements showing withholding where needed, monthly reports in English, Chinese and Japanese, and payouts in Japan or overseas. We can act as your tax agent (separate fee) and introduce partner tax accountants.

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Sources (official, in Japanese)

* This article and checker are general information (NTA materials current as of 1 April 2026). Tax treaties and individual circumstances can change the treatment; please confirm with a tax accountant. (Checked: 2 November 2026)