Question about 年末調整 forms and house sale

[Tkydon]

In twenty years in Japan, I have never had to do kakutei shinkoku. How do I go about this? Just go to my local tax office in January and tell them I wish to do kakutei shinkoku?
Also, I sold my house in town A and I now live in town B.
Do I go to the tax office of town A or town B?
Is there a specific date range when I have to do this?
January 1st to March 31st?

The Kakutei Shinkoku is for the National Taxes, and they then forward the information to the Prefectural and Municipal Tax Offices, so you should go to the local branch of the National Tax Office (Not the Municipal Tax Office) in your Ward / City / Town or Villiage.

If you did have to file a Kakutei Shinkoku:

1. If you have your 'My Number' Card and a Card Reader, you can file online at e-Tax

https://www.e-tax.nta.go.jp/

or

2. You can go to the local branch of the National Tax Office (Not the Municipal Tax Office) in your Ward / City / Town or Villiage, and the people there will help you to input your data into the system there (Recommended)

or

3. You can go to the local branch if the National Tax Office (Not the Municipal Tax Office) in your Ward / City / Town or Villiage, and pick up the forms and English Tax Guide explanation document from there, fill them out and drop them in the drop box at the Tax Office

or

4. You can download the forms and English Tax Guide explanation document from the NTA Website when they become available, fill them out and drop them in the drop box at the Tax Office.

The site and docs for 2023 (Reiwa 05) are not yet available. They will probably be available in late December or early January, and the window for filing is from Feb 16 to Mar 15 (though you can file before the Feb 16 date if you are owed a tax refund).

I will post a link when the site and docs for 2023 (Reiwa 05) become available.

[Roger Van Zant]

LOL, don’t put the sales into misc income, unless you want to be hit with xM Yen tax bill taxed as same tax rates as your salary.
Besides that, the capital gain is not the amount you sold it for. Simply speaking: Selling price less purchase price less selling & purchasing costs. And there is beforementioned allowance, and even more of that if you bought another home within a certain period of time.

If I were you, I’d call or walk over to the tax office and ask whether there is a special form to declare. Maybe that saves you from doing the Kakutei Shinkoku.

By the way, if you bought your home with a mortgage, you should have declared Kakutei Shinkoku before once to get the tax deduction for the mortgage.

Thanks.
I have never declared kakutei shinkoku before as my house was not eligible for any tax deductions (wooden house over twenty years-old when I bought it).
I have since found out that I simply need to fill out a form in February 2024 to report the sale of my house. It looks very simple, so I will report back once I have done this. My capital gains tax liability is zero.

[Tkydon]

LOL, don’t put the sales into misc income, unless you want to be hit with xM Yen tax bill taxed as same tax rates as your salary.
Besides that, the capital gain is not the amount you sold it for. Simply speaking: Selling price less purchase price less selling & purchasing costs. And there is beforementioned allowance, and even more of that if you bought another home within a certain period of time.

If I were you, I’d call or walk over to the tax office and ask whether there is a special form to declare. Maybe that saves you from doing the Kakutei Shinkoku.

By the way, if you bought your home with a mortgage, you should have declared Kakutei Shinkoku before once to get the tax deduction for the mortgage.

Thanks.
I have never declared kakutei shinkoku before as my house was not eligible for any tax deductions (wooden house over twenty years-old when I bought it).
I have since found out that I simply need to fill out a form in February 2024 to report the sale of my house. It looks very simple, so I will report back once I have done this. My capital gains tax liability is zero.

Great! The power of real-estate. So, what was your total Annual Rate of Return on the property?

[Roger Van Zant]

LOL, don’t put the sales into misc income, unless you want to be hit with xM Yen tax bill taxed as same tax rates as your salary.
Besides that, the capital gain is not the amount you sold it for. Simply speaking: Selling price less purchase price less selling & purchasing costs. And there is beforementioned allowance, and even more of that if you bought another home within a certain period of time.

If I were you, I’d call or walk over to the tax office and ask whether there is a special form to declare. Maybe that saves you from doing the Kakutei Shinkoku.

By the way, if you bought your home with a mortgage, you should have declared Kakutei Shinkoku before once to get the tax deduction for the mortgage.

Thanks.
I have never declared kakutei shinkoku before as my house was not eligible for any tax deductions (wooden house over twenty years-old when I bought it).
I have since found out that I simply need to fill out a form in February 2024 to report the sale of my house. It looks very simple, so I will report back once I have done this. My capital gains tax liability is zero.

Great! The power of real-estate. So, what was your total Annual Rate of Return on the property?

Not sure.
Bought for ¥13.5m in 2017. Sold for ¥18m in 2023.
Probably spent ¥1.5m on home improvements in those six years….

[TokyoWart]

Thanks.
I have never declared kakutei shinkoku before as my house was not eligible for any tax deductions (wooden house over twenty years-old when I bought it).
I have since found out that I simply need to fill out a form in February 2024 to report the sale of my house. It looks very simple, so I will report back once I have done this. My capital gains tax liability is zero.

Great! The power of real-estate. So, what was your total Annual Rate of Return on the property?

Not sure.
Bought for ¥13.5m in 2017. Sold for ¥18m in 2023.
Probably spent ¥1.5m on home improvements in those six years….

When you consider the tax-free benefit you have from living "rent-free" in your own home over those years I think this works out to a great return on investment. A traditional IRR calculation doesn't really capture this part of the return from owning the place you live in

[Tkydon]

Great! The power of real-estate. So, what was your total Annual Rate of Return on the property?

Not sure.
Bought for ¥13.5m in 2017. Sold for ¥18m in 2023.
Probably spent ¥1.5m on home improvements in those six years….

When you consider the tax-free benefit you have from living "rent-free" in your own home over those years I think this works out to a great return on investment. A traditional IRR calculation doesn't really capture this part of the return from owning the place you live in

Whilst the purchase price was ¥13.5m in 2017, how much was your downpayment? The actual return would be based on the actual downpayment - how much you actually invested in the property.

If no downpayment, then the return would be on the ¥1.5m on home improvements in those six years….

[Roger Van Zant]

Not sure.
Bought for ¥13.5m in 2017. Sold for ¥18m in 2023.
Probably spent ¥1.5m on home improvements in those six years….

When you consider the tax-free benefit you have from living "rent-free" in your own home over those years I think this works out to a great return on investment. A traditional IRR calculation doesn't really capture this part of the return from owning the place you live in

Whilst the purchase price was ¥13.5m in 2017, how much was your downpayment? The actual return would be based on the actual downpayment - how much you actually invested in the property.

If no downpayment, then the return would be on the ¥1.5m on home improvements in those six years….

No downpayment.
I got a 100% mortgage from my bank.

[Tkydon]

When you consider the tax-free benefit you have from living "rent-free" in your own home over those years I think this works out to a great return on investment. A traditional IRR calculation doesn't really capture this part of the return from owning the place you live in

Whilst the purchase price was ¥13.5m in 2017, how much was your downpayment? The actual return would be based on the actual downpayment - how much you actually invested in the property.

If no downpayment, then the return would be on the ¥1.5m on home improvements in those six years….

No downpayment.
I got a 100% mortgage from my bank.

Ah, yes, I remember.

So you put in Y1.5M + purchasing cost over the 6 years, and took out about Y6M ??? after paying off the mortgage and selling costs with the gain and paid down equity ???

300% Return or an Annual Return over 6 years of about 26% Per Year. Very respectable return...