This article is one of Zagdim’s wiki pieces on Japan family trusts, based on official Japanese sources, covering the registration and registration tax involved in placing a Japan property into a family trust, and what happens when the trustee later sells the property or the trust comes to an end. It is written for property owners in Japan who are considering a family trust, and for adult children whose parents own property in Japan. For the basic structure of a family trust and who it suits, see Zagdim’s main article on family trusts and dementia (linked in the “Localised” notes).
What Registration Do You File at the Legal Affairs Bureau?
Two registrations are filed, and they are filed at the same time: an ownership transfer registration that moves title from the settlor to the trustee, and a trust registration (shintaku tōki) — an entry on the register noting that the property is trust property. A trust registration must be filed together with the registration that creates, preserves, transfers, or changes the right the trust relates to; when a property is put into a trust, this is usually filed together with the ownership transfer registration.
This is not an optional formality. A trustee must keep trust property separate from their own property, and for registrable property such as real estate, trust registration is how that separation is kept; this duty cannot be waived by contract. A trustee can file the trust registration alone, and a beneficiary or settlor can also file it on the trustee’s behalf. For the documents a trustee living overseas needs to prepare, see Zagdim’s companion article on foreign nationals and non-resident settlors or trustees (linked in the “Localised” notes).
What Does the Trust Registration Record? Does the Beneficiary’s Name Appear?
Yes. Beyond the general items recorded for any registered right, a trust registration also records the name and address of the settlor, trustee, and beneficiary, along with the purpose of the trust, how the trust property is to be managed, and the grounds for ending the trust; the registrar may prepare a trust registry (shintaku mokuroku) setting out these trust particulars. The exception: where the conditions for designating a beneficiary have already been registered, or where a beneficiary’s agent has already been registered, the beneficiary’s name and address do not need to be recorded.
How Much Registration Tax Applies When You Put a Property Into Trust?
When a settlor transfers a property to a trustee to create the trust, the ownership transfer registration itself is not subject to registration and license tax (tōroku menkyozei) — the tax charged when a registration is filed. What is charged is the trust registration: for a trust registration of ownership, the rate is four parts per thousand of the property’s value. For land, under the Act on Special Measures Concerning Taxation, the rate is reduced to three parts per thousand for registrations filed on or before March 31, 2029. Buildings remain at four parts per thousand. If the trust agreement is drawn up as a notarized document, the notarization fee is covered in Zagdim’s main article on family trusts.
Is Real Estate Acquisition Tax Due?
As a general rule, no. When a settlor transfers real estate to a trustee to create the trust, the trustee’s acquisition is, as a general rule, not subject to real estate acquisition tax (fudōsan shutoku zei) — a tax paid to the local government when real estate is acquired; if the trustee is later replaced, the new trustee’s acquisition is also not taxed. There are exceptions, however, so confirm the individual case with a tax accountant (zeirishi).
Who Receives the Fixed Asset Tax Bill While the Property Is in Trust?
Fixed asset tax (kotei shisanzei) is charged to the owner; for land and buildings, the “owner” is whoever is registered as owner on the register. The Tokyo Metropolitan Bureau of Taxation explains that the person liable to pay is whoever is recorded as the owner in the fixed asset tax roll as of January 1 each year.
Once the trust registration is filed, the registered owner is the trustee, so under the Local Tax Act, fixed asset tax is charged to the trustee. How the tax bill is sent and paid should be confirmed with the municipality (shichōson) where the property is located.
If the property is sold partway through the year, that year’s fixed asset tax is still charged to whoever was the registered seller on January 1, and does not change because of a transfer on or after January 2. Pro-rating fixed asset tax by the number of days of ownership at the time of sale is a market custom, not something set out in the Local Tax Act; whether it is pro-rated is left to the buyer and seller to agree.
If the Trustee Later Sells the Property, How Are Registration and Tax Handled?
Whether the trustee can sell, and whose consent is needed first, depends on how the trust agreement is drafted; the agreement can limit the trustee’s authority, as covered in Zagdim’s main article on family trusts.
Registration: Once the property is sold, it is no longer trust property, so the cancellation of the trust registration must be filed together with the ownership transfer registration; the trustee can file the cancellation alone. The ownership transfer registration is, as a general rule, filed jointly by the buyer and seller, and for trust property, the seller’s side on the register is the registered owner — the trustee.
Whose income is the sale proceeds: For a trust where the beneficiary is treated as owning the trust property, selling the property held in trust is, as a general rule, treated as the beneficiary’s transfer income (jōto shotoku) — income from selling an asset. Where the parent is both the sole settlor and the sole beneficiary, the acquisition date is the date the parent originally bought the property, and the acquisition cost is calculated based on the parent’s continuous holding — it does not restart because the property was put into the trust. Trust fees the beneficiary pays the trustee that relate to the sale can be counted as a selling expense.
When the beneficiary lives overseas: Under the general rule for non-resident property sellers, income from a non-resident’s sale of Japanese real estate is subject to income tax in Japan; the buyer who pays the price in Japan generally withholds income tax and the special reconstruction income tax at 10.21% (plus, from 2027, a special defense tax) from the purchase price, and the seller can file a separate return to apply for a refund. Withholding is not required where the price is 100 million yen or less and the individual buyer is purchasing the property for their own or a relative’s residential use. Where a trust property is sold by the trustee and the price is paid to the trustee, official sources do not directly state who is the withholding subject or whether the buyer must withhold, so confirm with a tax accountant or the tax office before the sale. For taxes at other points in time, see Zagdim’s main article on the taxes that apply when a family trust is set up, during the rental period, and on the settlor’s death (linked in the “Localised” notes).
When the Trust Ends, How Does the Property Return to the Parent or Heirs?
When the trust ends and the property is handed to whoever it reverts to, this is again filed as a cancellation of the trust registration together with an ownership transfer registration.
For tax purposes, the following assumes that, from the time the trust took effect, the settlor has at all times been the sole principal beneficiary (ganpon juekisha) — the beneficiary entitled to the trust property itself, as opposed to its income:
- Registration and license tax: When the property moves from the trustee back to that settlor, the ownership transfer registration is not taxed; when it goes to the settlor’s heir instead, registration and license tax is calculated as if it were an inheritance.
- Real estate acquisition tax: Not charged when the property goes to that settlor, or to someone who inherits it from the settlor as of when the trust took effect.
If this assumption does not hold, the results above do not apply, and the case needs to be confirmed individually.
Four Stages at a Glance
| Stage | Registration | Main Tax |
|---|---|---|
| Putting the property into trust | Ownership transfer registration and trust registration filed together | Ownership transfer is not taxed; trust registration is four parts per thousand (three parts per thousand for land through March 31, 2029); real estate acquisition tax is, as a general rule, not charged |
| While held in trust | The registered owner is the trustee | Fixed asset tax is charged to whoever is the registered owner on January 1; who rental income belongs to is covered in Zagdim’s article on family trust taxes |
| Sold | Trust registration cancellation and ownership transfer registration filed together; the transfer registration is filed jointly by the trustee and the buyer | Income is, as a general rule, the beneficiary’s transfer income; where the beneficiary lives overseas, the general 10.21% withholding rule for property sales applies, but the trust scenario needs to be confirmed |
| Trust ends | Trust registration cancellation and ownership transfer registration filed together | Where the settlor has always been the sole principal beneficiary: moving back to the settlor is not taxed for registration and license tax, and moving to an heir is calculated as if it were an inheritance; real estate acquisition tax is not charged in these situations |
Frequently Asked Questions
How is registration and license tax calculated when you put a Japan property into trust? The ownership transfer registration is not taxed. The trust registration is charged at four parts per thousand of the property’s value; for land registered on or before March 31, 2029, the rate is reduced to three parts per thousand.
Who pays fixed asset tax once the property is in trust? Fixed asset tax is charged to whoever is registered as owner on January 1; once the trust registration is filed, the registered owner is the trustee. If the property is sold partway through the year, that year’s tax is still charged to the seller who was the registered owner on January 1.
When a trust property is sold, whose tax liability is the sale income? As a general rule, it is the beneficiary’s transfer income. Where the parent is both settlor and beneficiary, the acquisition date and acquisition cost carry over from the parent’s original holding. Where the beneficiary lives overseas, the general property-sale withholding rule is 10.21%, but the withholding arrangement for a trust property should be confirmed with a tax accountant before the sale.
Glossary
- Trust registration (shintaku tōki): The registration entered on the register when a property is put into a trust, noting that it is trust property.
- Registration and license tax (tōroku menkyozei): The tax paid when filing a real estate registration.
- Real estate acquisition tax (fudōsan shutoku zei): The tax paid to the local government when real estate is acquired.
- Trust registry (shintaku mokuroku): The registration document the registrar may prepare, setting out the trust particulars.
- Principal beneficiary (ganpon juekisha): A beneficiary entitled to the trust property itself, rather than to its income.
About This Data
The facts in this article were checked as of October 20, 2026. The statements that, on a sale of trust real estate, the seller’s side files the ownership transfer registration jointly with the buyer as the registered owner, and that fixed asset tax is charged to the trustee once the trust registration is filed, are based on Article 60 of the Real Property Registration Act and Article 343 of the Local Tax Act; official sources do not state these points specifically for trusts. The Legal Affairs Bureau does not publish a model registration application for a sale or trust termination, so this article does not list application documents. The reduced registration tax rate for land trust registrations applies through March 31, 2029; whether it will be extended has not yet been announced.
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Sources
- e-Gov — Trust Act
- e-Gov — Real Property Registration Act
- e-Gov — Registration and License Tax Act
- e-Gov — Act on Special Measures Concerning Taxation
- e-Gov — Local Tax Act
- National Tax Agency — Income Tax Basic Directive 33-1-8
- National Tax Agency — No. 1932: Selling Real Estate While Working Overseas
- National Tax Agency — No. 2879: When Purchasing Land From a Non-Resident
- Tokyo Metropolitan Bureau of Taxation — Fixed Asset Tax and City Planning Tax (Land and Buildings)
Important Notice
This article is a general information summary and does not constitute tax or legal advice for any individual case. Facts were checked as of October 20, 2026. Japanese regulations may change; refer to the current official announcements of the relevant authorities, and consult a qualified professional for individual cases.
