When acquiring property, the Real Estate Acquisition Tax applies. It covers most acquisitions except inheritance. By understanding how the tax base and reduction measures work, buyers can avoid unexpected costs.

1. How the tax base is calculated

The tax is calculated on the fixed asset tax valuation. The standard rate is 4%, but a 3% reduced rate often applies to residential land and buildings.

Example: if the valuation of a residence is ¥20,000,000, the tax is ¥600,000 at 3%.

2. Reduction measures

For new residences and certain existing ones, if the floor area is between 50㎡ and 240㎡, reduction applies.

For land, the special deduction equals twice the floor area of the residence (up to 200㎡) subtracted from the tax base.

3. Practice notes and example

Suppose a buyer acquires a 120㎡ new house (valuation ¥18,000,000). With the 3% reduced rate, the tax is ¥540,000. For the land valued at ¥12,000,000, applying the deduction can reduce the tax base to ¥0, eliminating land acquisition tax.

In practice, documents such as a certificate of inspection are required when filing.

Takeaway

The key is to check both the valuation and applicable rate and ensure the reduction conditions are met. Proper filing can reduce liability by hundreds of thousands of yen.