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Special Taxation Measures to Promote Property Accumulation

 

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Taxation measure to promote the acquisition of dwelling houses

Taxpayers can deduct from their income tax a certain amount, determined by the remaining housing loan balance, over 15-year period after their residence begins as a special tax credit for the acquisition of dwelling houses. Tax credit is applied, when he or she (1)has built a new dwelling house for his or her own residence; (2)acquires a dwelling house for his or her own residence; or (3)makes an addition to or a renovation of the house in which he or she lives (subject to certain conditions). (This measure is applied in CY1999 and CY2000)

Deduction for life insurance premiums
Deduction for casualty insurance premiums

Deduction for life insurance premiums

(a)

Life insurance premiums, up to ¥50,000, can be deducted from income.

(b)

Personal pension insurance premiums, up to ¥50,000, can be deducted from income.

Deduction for casualty insurance premiums

Casualty insurance premiums, up to ¥15,000, can be deducted from income.

"Maruyu2" for the elderly, etc.

"Maruyu" for the elderly

(a)

When certain procedures are followed, no income tax is levied on interest from postal savings of the elderly, up to the principal of 3.5 million yen.

(b)

When certain procedures are followed, no income tax is levied on interest from deposits, loan trust, bonds and designated securities investment trusts of the elderly, up to the principal of 3.5 million yen.

(c)

No income tax is levied on interest from national government bonds and publicly offered local government bonds of the elderly, up to the principal of 3.5 million yen, separately from the system of non-taxable small denomination savings of the elderly.

The system of promoting workers' property accumulation

(a)

No income tax is levied on interest from workers' property accumulation housing savings, up to the principal of 5.5 million yen, if the savings are made by withholding at source by the employers.

(b)

No income tax is levied on interest from workers' property accumulation pension savings which are made by withholding at source by the employers, up to the principal of 5.5 million yen (3.85 million yen, in the case of life and casualty insurance) even during the time when they are being paid out as pensions. However, the maximum amount subject to non-taxable is 5.5 million yen, inclusive of the amount exempted under the system of non-taxable for interest from workers' property accumulation housing savings.


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