Japan Inheritance Tax for Non-Residents: Unlimited vs Limited Taxpayer and the 10-Year Rule

When you receive an inheritance connected to Japan — whether you live there, once lived there, or simply have family assets there — the first question is not how much tax you owe. It is what is taxable.

Japan splits every heir into one of two categories:

• Unlimited taxpayer (無制限納税義務者): Pays Japanese inheritance tax on all assets worldwide.
• Limited taxpayer (制限納税義務者): Pays Japanese inheritance tax on Japan-situated assets only.

The difference can be enormous. A Japanese family home is worth ¥50 million; a Japanese-national heir’s overseas investment portfolio is worth ¥200 million. An unlimited taxpayer owes tax on ¥250 million in assets. A limited taxpayer owes tax on ¥50 million.

This article explains how Japan assigns that category — focusing on the domicile test, the 10-year nationality lookback, and the practical scenarios that catch overseas heirs off-guard.

This is general information, not advice. Tax rules change and your situation is unique. All figures and rules are current as of 2026 and cited to Japan’s National Tax Agency (NTA). Always confirm your status with a licensed zeirishi (tax accountant qualified in Japan).

The foundation: domicile (jūsho / 住所)

Japan’s inheritance tax does not care about citizenship or permanent residency status in the way you might expect. The primary test is domicile — the place where a person has their principal base of life (seikatsu no honkyo / 生活の本拠).

Domicile is a factual question, not a registration question. Having a jūminhyō (resident registration card) in Japan creates a presumption of Japan domicile, but cancelling your registration does not automatically end it if your actual life is still centred in Japan. Conversely, a foreigner in Japan on a temporary work assignment may not establish Japan domicile if the circumstances show their true life base remains abroad.

Courts and tax authorities look at factors including:

• Where you actually live day-to-day
• Where your family lives
• Where you work and where your business interests are centred
• The intended duration of any stay
• Whether you maintain a home abroad

This is the same domicile concept that applies in Japanese civil law (Civil Code Article 22).

The taxpayer-category matrix

Japan’s inheritance tax law (Inheritance Tax Act, Articles 1-3) sets out the full grid. Simplified to the situations most relevant to international readers:

The bottom line for most purely overseas foreign nationals: you are a limited taxpayer. Japan can tax you on Japanese real estate, Japanese bank accounts, and Japanese securities — but not on your house in London or your brokerage account in New York.

NTA reference: No. 4138 — 相続税の納税義務者について

The 10-year lookback rule for Japanese nationals

The rule that catches the most people off guard is the 10-year lookback for Japanese nationals.

If you are a Japanese national living abroad, you do not automatically become a limited taxpayer the day you leave Japan. You remain an unlimited taxpayer for 10 years after your last Japan domicile. During that window, your worldwide assets — wherever held — are taxed under Japan’s inheritance tax rules.

History of the rule

The lookback period has tightened over time:

The 2013 extension was a direct response to tax planning that involved Japanese nationals formally relocating abroad to shelter overseas assets from Japanese inheritance tax. The 10-year period makes that strategy far less practical.

What this means practically

Say a Japanese national relocates permanently to the United States in January 2020 and deregisters their Japan residence. If a parent in Japan dies in December 2027 — seven years later — the heir is still within the 10-year window and is treated as an unlimited taxpayer. All of their worldwide assets (the US house, US brokerage accounts, etc.) plus all inherited assets from Japan fall into the Japanese inheritance tax calculation.

Only after January 2030 — 10 full years after leaving — would that heir become a limited taxpayer.

Dual nationals

Dual nationals are treated as Japanese nationals for this purpose if they hold Japanese nationality, regardless of any other citizenship they hold.

Foreign nationals: the limited-taxpayer default

Foreign nationals (non-Japanese nationals) who do not have Japan domicile are limited taxpayers by default. They owe Japanese inheritance tax only on Japan-situated assets.

This is not affected by how long they previously lived in Japan. A US citizen who spent 20 years in Japan, left, and now lives in California has no Japan domicile. If they inherit a Japanese property, they are a limited taxpayer — taxed on that property, not on their California assets.

The “temporary resident foreigner” carve-out

The 2021 reform introduced a further protection for foreign nationals living in Japan at the time of inheritance. If a foreign national:

1. Holds a Table-1 immigration status (work, study, spouse/child of Japanese national, etc. under the Immigration Control and Refugee Recognition Act Appended Table 1), and
2. Has had a Japan domicile for 10 years or less out of the preceding 15 years

…they are treated as a temporary resident foreigner (一時居住外国人) and classified as a limited taxpayer, not unlimited — even though they currently have Japan domicile.

This carve-out protects seconded employees, expatriate staff, and other internationally mobile foreign nationals from having their entire worldwide estate exposed to Japanese inheritance tax simply because they happen to be living in Japan at the time a family member dies.

There is a parallel rule that protects the decedent’s overseas assets when both the decedent and heir are temporary resident foreigners. In that scenario, the decedent’s overseas assets are excluded from the taxable estate entirely.

NTA reference: No. 4138 — 相続税の納税義務者について
The detailed structure of the temporary-foreigner reform is covered more fully in our spoke article on the 2021 reform for temporary foreigners.

What counts as a “Japan-situated asset”?

If you are a limited taxpayer, only Japan-situated assets (国内財産) are taxable. The Inheritance Tax Act and its enforcement ordinance define situs rules for each asset type:

One trap: a deposit at the Tokyo branch of a foreign bank is generally Japan-situs (the branch is in Japan). A deposit at the New York branch of a Japanese bank is generally non-Japan situs.

NTA reference: No. 4152 — 相続財産の範囲

The decedent’s status also matters

Your taxpayer category determines what your assets are taxed on. But what the deceased owned — and where — is a separate question.

If the decedent had Japan domicile at death, all of their worldwide assets enter the taxable estate. Even a limited-taxpayer heir (say, a US-citizen child living in New York) will be taxed on their share of any Japanese assets the decedent held.

If the decedent had no Japan domicile, only their Japan-situated assets enter the taxable estate for limited-taxpayer heirs.

The interaction creates a matrix of possible outcomes. The most important planning question is: what is the decedent’s residency status? — not just the heir’s.

Common scenarios

Scenario A — Japanese national living in Australia, inheriting from a parent in Japan
If the heir has been out of Japan for less than 10 years: unlimited taxpayer. Their Australian assets are not directly inherited but their worldwide position matters for Japan’s gift/inheritance planning. If over 10 years, they become a limited taxpayer.

Scenario B — British national on a work visa in Japan, parent dies in the UK
The heir has Japan domicile (they live there). But if they qualify as a “temporary resident foreigner” (Table-1 visa, ≤10 years in Japan in the past 15), they are a limited taxpayer — only the inherited UK assets that happen to be Japan-situated (there probably are none) are taxed. In practice, no Japanese inheritance tax would apply to UK assets.

Scenario C — American national, never lived in Japan, parent owned a Tokyo apartment
Limited taxpayer. They owe Japanese inheritance tax on the Tokyo apartment. Their US assets are irrelevant.

Scenario D — Japanese national, left Japan 12 years ago, parent dies in Japan
Limited taxpayer — the 10-year lookback has expired. They owe tax on the Japan-situated assets they inherit (the parent’s property, accounts), but not on their own overseas assets.

Planning considerations (not advice)

Understanding your category is the starting point for any cross-border estate planning connected to Japan. A few questions worth discussing with a licensed zeirishi and cross-border adviser:

• If you are a Japanese national within the 10-year window, what Japan-connected assets are in play — and are there treaty mechanisms (e.g., the Japan–US Estate Tax Convention) that prevent double taxation?
• If you expect to become a limited taxpayer after 10 years, does timing of gifts matter? (Gift tax has its own lookback rules, and the 2024 reform on 7-year gift add-back adds complexity.)
• If you are a foreign national on a Table-1 visa in Japan, does your visa type and cumulative Japan residency actually qualify you for the temporary-foreigner carve-out?

The tax rules here are set out in statutory language. This article summarises them, but the application to any individual situation requires professional review.

Where to go next

• The pillar article on Japan’s inheritance tax for foreigners covers the calculation framework, rates, and the spouse credit: Japan Inheritance Tax: The Complete Guide for Foreigners and Overseas Heirs
• For expats on secondment and corporate HR teams, the 2021 temporary-foreigner reform is covered in detail: Japan’s Temporary Foreigner Inheritance Reform (2021)
• Digital assets add a layer of complexity to cross-border estate planning. Our Security media covers the account access and digital custody side.

Sources

• NTA No. 4138 — 相続税の納税義務者について (Inheritance Tax Taxpayer Categories) — primary reference for unlimited/limited status and temporary-foreigner rules
• NTA No. 4105 — 相続財産の範囲 (Assets Subject to Inheritance Tax) — definition of taxable assets
• NTA No. 4152 — 相続財産の範囲 (Scope of the Taxable Estate) — Japan-situs asset definitions
• NTA No. 4155 — 相続税の税率 (Inheritance Tax Rates)
• Japan Inheritance Tax Act (相続税法), Articles 1–3 — statutory definitions of taxpayer categories
• Japan Inheritance Tax Act Enforcement Ordinance (相続税法施行令) — situs rules by asset type
• NTA — 相続税の申告書の提出期限 — 10-month filing deadline