The 4 Types of Land Prices in Japan

Land Price Types in Japan

There are four types of land prices in Japan which are the "public land price", "fixed asset tax evaluation value", "inheritance tax route value" and the "actual price".

First, the "public land price" is an indicator of general land transaction price and is announced annually by the Ministry of Land, Infrastructure and Transport. Approximately 23 thousand land spots in the whole country will be appraised as of January 1 of every year and will be reported around the end of March. The news that the land of Ginza became the number one in Japan can be determined due to the calculations of the public land price data.

The "fixed asset tax assessment amount" is the price which becomes the basis of the calculation of real estate-related taxes such as property tax, real estate acquisition tax, registration license tax. As most land throughout the country is included in the calculation, prices are updated once every three years (as of January 1 every 3 years). In addition, if prices are fluctuating greatly during the three years, corrections may be added. Moreover, in principle, only the owner and the leaseholder of the land and building can learn the price. The fixed asset tax evaluation value is determined by the public land price and the base standard price 70% as a guide. Those who pay fixed property tax on land and buildings every year can see how much the evaluation price is when you view the tax notice from the municipality.

The "inheritance tax value" corresponds to the price forming the basis of calculation of inheritance tax and gift tax of land. The National Tax Agency announces it annualy at the beginning of July. The inheritance tax route value does not refer to the price of the entire lot, but rather the price attached to the road. By multiplying the land area with the price attached to the road that is in contact with the property, you can calculate the appraisal value when calculating the inheritance tax. It is determined based on the public land price of 80%.

The Transaction Price is known as the "actual price"

The above public land prices are used only as a standard of land transaction or it is used for tax calculation. It is different from the actual selling price. Land trading is based on the market price at that time in principle. In other words, if the person who wishes to buy and the person who wishes to sell agree, trading will be established, so the agreed price corresponds to the market price. This is usually called "actual price".

Land Price Types in Japan

There are four types of land prices in Japan which are the, "public land price", "fixed asset tax evaluation value", "inheritance tax route value" and the "actual price".

First, "public land price" is an indicator of general land transaction price, it will be announced by the Ministry of Land, Infrastructure and Transport. Approximately 23 thousand land spots in the whole country will be appraised as of January 1 of every year and will be announced around the end of March. The news that the land of Ginza became the number one in Japan is announced due to the publish of the public land price data.

"Fixed asset tax assessment amount" is the price which becomes the basis of the calculation of real estate related tax such as property tax, real estate acquisition tax, registration license tax etc As most land throughout the country is covered, prices are updated once every three years (as of January 1 every 3 years). In addition, when prices are fluctuating greatly during the three years, corrections may be added. Moreover, in principle, only the owner and the leaseholder of the land and building can learn the price, the fixed asset tax evaluation value is determined by the public land price and the base standard price 70% as a guide. Those who pay fixed property tax on land and building every year can see how much the evaluation price is when you view the tax notice from the municipality.

"Inheritance tax value" corresponds to the price which is the basis of calculation of inheritance tax and gift tax of land. The National Tax Agency announces it on the beginning of July yearly. The inheritance tax route value does not refer to the price of the whole land, but the price attached to the road. By multiplying the land area with the price attached to the road that is in contact with the property, you can calculate the appraisal value when calculating the inheritance tax. It is determined based on the public land price of 80%.

The Transaction Price is known as the "actual price"

The above public land price is used only as a standard of land transaction or it is used for tax calculation. It is different from the actual selling price. Land trading is based on the market price at that time in principle. In other words, if the person who wishes to buy and the person who wishes to sell agree, trading will be established, so the agreed price corresponds to the market price. This is usually called "actual price".

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