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Home›Tax Return (Kakutei Shinkoku)›Housing Loan Tax Deduction (First-Year Tax Return)

Housing Loan Tax Deduction (First-Year Tax Return)

If you took out a housing loan to buy or build your home, 0.7% of your outstanding loan balance at year-end can be deducted from your income tax. Only the first year requires a tax return. From year 2 onward, salaried employees switch to the year-end adjustment at work. Freelancers, self-employed, and rental income earners must continue filing a tax return each year.

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Documents needed

✓Certificate of registered matters / toki jiko shomeisho (from the Legal Affairs Bureau)
✓Copy of purchase agreement or construction contract
✓Year-end loan balance certificate (sent by your lender)
✓Withholding tax certificate (if you have salary income)
✓My Number card or number confirmation document + identity verification document
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Steps

1

In January–February of the year after purchase, your lender will mail you the year-end loan balance certificate

2

Obtain a certificate of registered matters from the Legal Affairs Bureau (online application available)

3

In the e-Tax filing corner, select 'Housing Loan Special Tax Credit' and enter the required details

4

Submit your tax return between February 16 and March 15

5

Salaried employees: from year 2, simply submit the year-end loan balance certificate to your employer — it is handled through the year-end adjustment. Freelancers, self-employed, and rental income earners must continue filing a tax return each year to claim this deduction

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Important notes

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The deduction period varies by home type and move-in year (up to 13 years). Homes classified as 'other' with move-in dates in 2024–2025 are generally 0 years. A 10-year deduction is available if the home received building confirmation by December 31, 2023, or construction was completed by June 30, 2024

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The deduction is not available in any year your total income exceeds ¥20 million

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The home must have a floor area of at least 50㎡ (or 40㎡ in some cases)

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Conditions differ for pre-owned homes and renovations — check the NTA website for details

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Don't forget the year-end adjustment procedure from year 2 onward — your employer will ask for the balance certificate each October–November

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