🧾 What You Can (and Can’t) Write Off When Buying an Akiya

One of the most exciting parts of buying an akiya in Japan is the price tag. Homes can be shockingly cheap compared to Western real estate markets. But if you’re purchasing as an investment—whether to rent out, run as a guesthouse, or flip—you’ll also want to think about the tax side of the deal.

Japan’s tax system has its own quirks, and not everything you spend is deductible. So, what can you actually write off when buying an akiya—and what costs are yours to swallow?

Let’s break it down.

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📑 First: The Difference Between Personal & Business Use

Before diving into deductions, you need to know:

• Personal Use: If you buy an akiya just as a private residence, you generally cannot claim write-offs beyond fixed asset tax (like property tax).
• Business Use: If you buy as an investment (guesthouse, rental, office, creative studio), you may claim deductions and depreciation against your income.

💡 Pro Tip: Many foreign buyers structure their akiya as a business property to maximize tax benefits.

✅ What You Can Write Off

If the akiya is used for business or income-generating purposes, you can usually deduct:

1. Purchase-Related Costs

• Judicial scrivener fees (司法書士費用)
• Real estate agent commission (仲介手数料)
• Registration & license tax (登記免許税)
• Stamp duty on contracts

2. Ongoing Taxes & Fees

• Fixed asset tax (固定資産税)
• City planning tax (都市計画税, in some regions)
• Insurance premiums (fire, earthquake, liability for rentals)

3. Renovation & Repair Costs

• Structural repairs (roof, foundation, plumbing, electrical)
• Safety upgrades (fire alarms, septic tanks, earthquake retrofitting)
• Renovations for tenant or guest use (bathroom remodels, kitchen upgrades)

⚠️ Note: Some improvements may need to be capitalized and depreciated instead of written off all at once.

4. Operating Expenses (If Rented or Run as Business)

• Utility bills (water, electricity, gas, internet)
• Cleaning and maintenance costs
• Advertising, website, and marketing expenses
• Property management fees
• Travel costs related to property management (including train tickets, tolls, mileage if you’re driving to the property for business)

5. Depreciation (減価償却 / genka shōkyaku)

Japan allows you to depreciate:

• The building structure (over 22–40 years depending on type)
• Certain renovations
• Furnishings and appliances (shorter depreciation schedules, usually 3–10 years)

❌ What You Can’t Write Off

Not everything counts as a deductible expense. These include:

• Land Value → Land in Japan is never depreciated and cannot be written off.
• Personal-Use Renovations → If you buy an akiya for yourself and just repaint the walls, it’s not deductible.
• Furniture & Decor for Personal Living → Unless it’s part of a business, you can’t claim your new sofa or shoji doors as deductions.
• Mortgage Principal → Loan repayments aren’t deductible (though interest payments may be, if it’s a business expense).
• Commuting or Vacation Costs → If you visit your countryside akiya for fun, not business, travel costs aren’t deductible.

🏛 Special Note: Foreign Buyers & Write-Offs

If you’re a foreigner buying an akiya, whether you can write off costs depends on your tax residency status:

• Resident in Japan (with a visa and tax ID): You’ll file in Japan and can use local deductions.
• Non-Resident: You may still owe taxes in Japan on income generated there (like rent or guesthouse revenue). But deductions are limited, and you may also have reporting requirements in your home country.

💡 Pro Tip: Always work with a Japanese tax accountant (税理士 / zeirishi) to optimize deductions.

📊 Example: Guesthouse Conversion

Let’s say you buy an akiya for ¥2,000,000 and spend ¥6,000,000 renovating it into a guesthouse.

Deductible:

• ¥400,000 judicial scrivener + commission fees
• ¥6,000,000 renovations (depreciated over time)
• ¥50,000 yearly insurance
• ¥100,000 yearly utilities
• ¥200,000 annual fixed asset tax
• Marketing expenses (website, ads, Airbnb fees)

Not Deductible:

• The ¥1,500,000 land portion of the purchase
• Personal trips to “enjoy” the house
• Decorative items used purely for personal taste

🧭 Final Thoughts

Akiya homes can be an affordable path into Japanese property ownership—but if you want to maximize ROI, you need to treat them like a business.

By understanding what you can and can’t write off, you’ll avoid surprises at tax time and unlock the true financial potential of your countryside home.

🏡 Need Help Structuring Your Akiya as an Investment?

At Old Houses Japan, we help buyers go beyond just finding homes—we guide you in making them financially sustainable. From connecting you with tax specialists to identifying subsidy programs, we’ll help you maximize returns.