Who Pays the Accommodation Tax, and How Is It Collected?

If you own a short-term rental in Japan — or are weighing whether to — the question of accommodation tax is one that catches many overseas owners off guard. Japan’s accommodation tax (shukuhaku-zei) sits on top of consumption tax, operates at the municipal level rather than nationally, and the obligation to collect and remit it falls not on the guest but on whoever is running the property. For a non-resident owner relying on a management company, that distinction matters considerably.

What the Accommodation Tax in Japan Actually Is, and Which Rentals It Covers

Japan has no single national accommodation tax. Instead, individual prefectures and cities legislate their own levies under the Local Tax Act. Tokyo, Osaka, Kyoto, Fukuoka, and Kanazawa have all enacted versions, and other municipalities are actively drafting them. The rates and thresholds vary significantly by location. In Tokyo, for example, the levy is tiered by room rate — guests paying under ¥10,000 per night are currently exempt, while those paying ¥10,000–¥14,999 are charged ¥100 per person per night, with higher brackets above that. Osaka and Kyoto apply different thresholds and per-person rates.

Crucially, these levies apply across licence types. Whether your property operates under the Housing Accommodation Business Act (the Minpaku Law, which imposes a 180-night annual cap on standard registered properties), a full ryokan business licence under the Hotel Business Act, or — where still available — a national strategic special zone exemption (tokku minpaku), the local accommodation tax obligation attaches to the letting activity itself, not the licence type.

Who Is Legally Responsible for Collection and Remittance

Under the relevant prefectural or municipal ordinances, the legal collector is the operator — the entity or individual conducting the accommodation business. For an overseas owner who has appointed a Japanese management company to run their property, this is where the contractual language in your management agreement becomes critical. If the management company holds the operating licence in its own name (which is common practice for non-resident owners, since you cannot personally satisfy the residency requirements for some licence applications), the remittance obligation typically sits with them. If, however, the owner holds the licence and the company is acting purely as an agent, the owner remains liable even if collection is handled operationally by someone else.

We have seen arrangements where this was left ambiguous — the owner assumed the management company was handling it, the management company treated it as the owner’s responsibility, and the filing simply did not happen. Municipal tax offices do follow up, and the penalties are not nominal. Before anything else, confirm in writing: who files, who remits, and from which account.

How the Tax Is Actually Collected at Property Level

In practice, the accommodation tax is added to the guest’s total charge at booking or check-in. On platforms like Airbnb, the platform itself collects and remits accommodation tax in certain municipalities under agreements with local governments — but this coverage is not universal, changes as new ordinances come into force, and does not extend to all booking channels. If you are operating across multiple OTAs and direct bookings, the management company needs a consistent process for capturing the tax on every reservation that falls within a taxable threshold.

In our operation, we had a period where a property was taking both Airbnb and direct bookings routed through a separate channel manager. Airbnb was remitting Osaka’s levy automatically. The direct bookings were not. When we audited the records ahead of a quarterly filing, the shortfall was immediately visible — but only because we were maintaining a consolidated reservation log that tracked the booking source against the tax collected. An overseas owner with no access to that log would have had no way of knowing. This is a routine operational gap, not an edge case, and it is exactly the kind of thing to ask your management company about directly: “Show me how accommodation tax is tracked per booking channel.”

Consumption Tax, Withholding Tax, and the Non-Resident Owner’s Specific Exposure

Accommodation tax is distinct from consumption tax (shohizei), currently set at 10% on taxable accommodation services under the Consumption Tax Act. Whether your operation is liable to charge and remit consumption tax depends on whether your annual taxable sales exceed the ¥10 million threshold — operators below this are generally exempt as small businesses, though the rules around new registrations and voluntary registration have tightened in recent years following the introduction of the qualified invoice system (invoice seido) in October 2023.

For non-resident owners, there is a further layer: Japanese withholding tax on rental income paid to overseas recipients. Under the Income Tax Act, a Japanese paying agent (your management company) is generally required to withhold 20.42% from rental income before remitting to a non-resident. Whether a tax treaty between Japan and your country of residence reduces this rate depends on the specific treaty. This withholding is separate from, and does not offset, your obligation to file a Japanese income tax return as a non-resident with Japanese-source income. Both apply. Engage a Japanese tax accountant (zeirishi) who handles non-resident filings — this is not something to delegate informally to your management company.

Licence Type and Location Determine What Is Actually Possible

The accommodation tax question cannot be separated from the underlying operating licence, because the licence determines whether you can operate at all, and under what constraints.

Under the Minpaku Law, a standard registered property is capped at 180 nights per year of letting. Many municipalities impose further restrictions — limiting operating days to weekends, or excluding certain residential zones entirely. These local rules directly constrain your revenue, which in turn affects the economics of paying accommodation tax and management fees.

Properties seeking to avoid the 180-night cap typically pursue a ryokan business licence under the Hotel Business Act, which requires meeting facility and staffing standards that vary by prefecture. This is a more demanding path but unlocks year-round operation.

The tokku minpaku route — operating under a national strategic special zone exemption, which allowed longer operating periods under different conditions — is no longer available for new applicants in Osaka City. As of 29 May 2026, Osaka City has permanently ended new applications for tokku minpaku. Existing certified facilities may continue, but any new property opening in Osaka must proceed under the Minpaku Law or obtain a ryokan licence. Anyone who has been told otherwise by a consultant or agent should verify directly with the Osaka City government.

What to Ask Your Management Company — and What to Check Yourself

For an overseas owner who cannot visit the property, the management company is your entire operational interface. The fee structure for a Japanese short-term rental management company typically ranges from around 10–25% of revenue, depending on scope of service, property type, location, and how much the operator actually handles end-to-end (cleaning coordination, guest communication, maintenance, regulatory compliance, tax filing). Be cautious of any company that quotes well below this range without a clear explanation of what is excluded.

On accommodation tax specifically, ask:

• Who holds the filing obligation under the relevant municipal ordinance — you or the management company?
• How is the tax tracked when reservations come from multiple booking channels?
• Which channels are remitting automatically, and which require manual collection?
• Can you provide the last two filing receipts as evidence of remittance?
• How are thresholds monitored for guests paying below the taxable room rate?

On the non-resident financial side, ask for monthly statements that separately itemise gross revenue, accommodation tax collected, management fee, withholding tax deducted, and net remittance — in both JPY and your reporting currency. If a company cannot or will not produce this breakdown, that is informative in itself.

Stay Buddy operates properties on behalf of overseas owners across Japan, handling licensing, compliance, guest operations, and financial reporting. If you want to understand what running your specific property actually involves — accommodation tax obligations included — speak to us directly.

Written by the Stay Buddy Japan team. This content was produced with AI assistance and reviewed for accuracy.