{"id":4352,"date":"2020-05-22T18:05:26","date_gmt":"2020-05-22T09:05:26","guid":{"rendered":"https:\/\/wealth-park.com\/?post_type=wealthpark&p=4352"},"modified":"2022-08-03T15:37:56","modified_gmt":"2022-08-03T06:37:56","slug":"20200522_covid-19_tax","status":"publish","type":"wealthpark","link":"https:\/\/wealth-park.com\/en\/wealthpark-blog\/20200522_covid-19_tax\/","title":{"rendered":"OVID-19: The Tax Measures for Property Owners"},"content":{"rendered":"

\"\"<\/p>\n

As a property owner, we are curious about how the Japanese government reacts to COVID-19 to help us overcome the difficulties. This time, we would like to share with you three tax measures that are applicable to landlords: the grace period for tax payment, the tax reduction\/exemption on corporate tax due to the reduction in rent, and the reduction\/exemption on property tax & city planning tax.<\/p>\n

1. The grace period for tax payment<\/h2>\n

Due to the effect of COVID-19, those who meet with either \u2460 or \u2461 circumstance below are eligible for 1 year grace period payment in income tax, corporate tax, and consumption tax (stamp tax is not included) which due by February 1, 2020 to January 31, 2021. There\u2019s no need for guarantees and there won\u2019t be any overdue fine.<\/p>\n

\u2460 Suffering from lost since business income decreased by 20% or more in 2020 compared to the same period (1 month or more) of 2019.
\n\u2461 Having difficulties to pay the tax temporarily<\/p>\n

Notice that the \u201cbusiness income\u201d refers to corporations or individual business sales revenue, salary income, real estate rental income, etc. Also notice that in order to receive the grace period, it is necessary to apply to the relevant tax office by 30 June 2020 or by the payment date, whichever is later.<\/p>\n

\u3010References\u3011<\/h4>\n

Ministry of Finance<\/a>
\n<\/span>Ministry of Finance \/ National Tax Agency<\/a>
\n<\/span>National Tax Agency<\/a><\/span><\/p>\n

2. The tax reduction\/exemption on corporate tax due to the reduction in rent<\/h2>\n

Normally, when a landlord gives a tenant (who has a lease agreement with the landlord) rent reduction with no rational reason, in principle the reduction amount will be deemed as a donation under the Corporate Tax Law. However, under the following circumstances, the reduction amount won\u2019t be deemed as a donation.<\/p>\n

    \n
  1. It is clear that the tenant is suffering from the loss of income or facing severe difficulties to maintain the business operation due to COVID-19.<\/li>\n
  2. The reduction in rent is intended to support the tenant\u2019s business revivification (business continuity, employment security, etc.), and it can be confirmed by written documents.<\/li>\n
  3. The reduction in rent must have been done within a considerable period of time (a period during the recovery process to resume normal business activities) after the damage to the tenant occurred.<\/li>\n<\/ol>\n

    \u3010References\u3011<\/h4>\n

    National Tax Agency<\/a><\/span><\/p>\n

    3. The reduction\/exemption on property tax & city planning tax.<\/h2>\n

    Regarding to the property tax and city planning tax in 2021 for \u201csmall & medium\u00a0enterprise owners whose business income has decreased more than a certain amount\u201d due to the influence of COVID-19, there is a system to reduce or exempt the amount in full or half, details shown in the table below. Furthermore, if the operator of a leasing business (buildings, condominiums, apartments, etc.) are suffering from income decrease because of the reduction in rent due to COVID-19, the system can also be applicable if all requirements are met.<\/p>\n

    \"\"<\/p>\n

    Regarding the definition of \u201csmall & medium enterprise\u201d, in Japan it is applicable to those business entities whichever has 1,000 or fewer employees. The application of tax reduction\/exemption should be submitted to the local authorities by January 31, 2021 (declaration deadline), with all required documents attached.<\/p>\n

    \u3010References\u3011<\/h4>\n

    The Small and Medium Enterprise Agency<\/a>
    \n<\/span>    200501zeisei01.pdf<\/a>
    \n<\/span>    200501zeisei02.pdf<\/a><\/span><\/p>\n

    This time, we concluded three applicable tax measures against COVID-19 for landlords: the grace period for tax payment, the tax reduction\/exemption on corporate tax due to the reduction in rent, and the reduction\/exemption on property tax & city planning tax. Hope this information can be helpful to you.<\/p>\n

    WealthPark has sufficient experience and professionals in property management and sales. If you have any questions, please feel free to contact us.<\/p>","protected":false},"featured_media":38178,"template":"","categories":[41],"tags":[49,69],"class_list":["post-4352","wealthpark","type-wealthpark","status-publish","has-post-thumbnail","hentry","category-articles","tag-cio","tag-propertymarket"],"acf":[],"_links":{"self":[{"href":"https:\/\/wealth-park.com\/en\/wp-json\/wp\/v2\/wealthpark\/4352","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/wealth-park.com\/en\/wp-json\/wp\/v2\/wealthpark"}],"about":[{"href":"https:\/\/wealth-park.com\/en\/wp-json\/wp\/v2\/types\/wealthpark"}],"version-history":[{"count":1,"href":"https:\/\/wealth-park.com\/en\/wp-json\/wp\/v2\/wealthpark\/4352\/revisions"}],"predecessor-version":[{"id":8925,"href":"https:\/\/wealth-park.com\/en\/wp-json\/wp\/v2\/wealthpark\/4352\/revisions\/8925"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/wealth-park.com\/en\/wp-json\/wp\/v2\/media\/38178"}],"wp:attachment":[{"href":"https:\/\/wealth-park.com\/en\/wp-json\/wp\/v2\/media?parent=4352"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/wealth-park.com\/en\/wp-json\/wp\/v2\/categories?post=4352"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/wealth-park.com\/en\/wp-json\/wp\/v2\/tags?post=4352"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}