A guide to tax deductions available to employees and freelancers living in rental housing during tax filing. We cover how to claim medical expense deductions, differences from housing loan tax credits, expense allocation of rent for side businesses and remote work, and other essential tax knowledge renters should know.
Reviewed by: Nobuyuki MoriPresident, M-Assets Co., Ltd. / Licensed Real Estate Transaction Specialist (Miyagi #018212)
When transferring due to a job relocation, moving costs may be covered by your company or be your own responsibility. We explain whether company-provided allowances are taxable or non-taxable, cases where you can recover money through your tax return, and how to think about claiming expenses.
A comprehensive breakdown of how resident tax works—a system that many renters surprisingly don't understand. This guide covers how resident tax is calculated, the difference between salary withholding and self-payment, how your tax payment destination changes when you relocate, and practical tax deductions and strategies available to renters who cannot use the home loan tax credit.
A guide to deducting rent as a business expense for side hustlers and freelancers working from rental apartments. Covers apportionment calculation rules, allocation ratios typically accepted by tax authorities, and required documentation.
Many assume that tax filing is only for self-employed individuals, but there are cases where employees should also file. Additionally, for freelancers and those with side business income, allocating a portion of rent as business expenses is an important tax savings strategy.
Key tax filing and savings opportunities for renters include:
Let's look at each in detail.
The medical expense deduction allows you to deduct from your income the amount by which your annual medical expenses (including yourself and family members who depend on you) exceed 100,000 yen.
Examples of Deductible Medical Expenses
Non-Deductible Medical Expenses
Rent payments from a rental property are not eligible for medical expense deduction. However, if your annual medical expenses exceed 100,000 yen, you can file even if you're a renter. Keep receipts and invoices for one year.
The Self-Medication Tax System, introduced in 2017, allows you to deduct from your income the amount by which your annual spending on certain over-the-counter drugs (switched OTC medications) exceeds 12,000 yen, up to a maximum of 88,000 yen.
This is a separate option from the standard medical expense deduction (100,000 yen threshold), so if your total medical expenses are less than 100,000 yen, this system is recommended. Products eligible for this system are marked as such on pharmacy receipts.
The housing loan tax credit (Special Tax Credit for Housing Loans) applies only when you purchase a home and does not apply to rental housing payments.
However, the following cases warrant consideration as exceptions:
Renters can use housing loan tax credits only when they purchase a home in the future. If you're considering a purchase, consulting with a tax accountant or housing financial planner is advisable.
For those with side business income or freelancers, allocating a portion of rent as business expenses through "household expense allocation" is an important tax savings strategy.
Conditions for Allocation You must use a portion of your home for business purposes. While simple "remote work" may not be recognized for allocation, it is accepted when you have a clearly dedicated workspace or documented personal business activity.
Calculation Examples for Allocation Ratio
| Condition | Example Allocation Ratio |
|---|---|
| Using an entire room for business | 100% |
| One room (8 tatami mats) dedicated as office, total home is 3LDK (50 sq m) | Approx. 25–30% |
| 3 days per week remote work (out of 5 work days) | Day ratio × Space ratio |
Other Expenses You Can Allocate
Tax authorities require "a calculation method that reflects actual circumstances and is reasonable." If your allocation ratio is too high, there is a risk of denial, so it's important to keep evidence (work logs, floor plans).
If you move for business reasons, part of your moving expenses may be recognized as business expenses or as special deductions for salaried workers.
Special Deduction for Salaried Workers Moving expenses resulting from job transfer or job change orders that are not reimbursed by your company can be deducted as a special deduction. However, you can only deduct the amount exceeding half of your basic salary deduction (the benefit is minimal unless you have high income).
Business Expenses (Freelancers and Self-Employed) Moving expenses related to office relocation or business location changes can be deducted as either the full cost or an allocated portion.
Even if medical expenses are less than 100,000 yen, you must file if you're claiming Hometown Tax donations or reporting side business income. If this is your first time, take advantage of free consultations at your local tax office.
While rental housing payments don't qualify for housing loan tax credits, renters have multiple tax savings strategies available, including medical expense deductions, the Self-Medication Tax System, and rent expense allocation for side businesses.
For those with side business or freelance income, allocating rent, utilities, and communication expenses can yield tax savings of several thousand yen. Make it a habit to keep receipts and documentation, and take advantage of annual tax filing.
Furusato tax donations can be maximized even if you rent. We explain everything renters need to know about furusato donations: the advantage of not competing with mortgage tax credits, how to choose between the One-Stop Special Exception and final tax return filing, accurate calculation methods for residential tax deduction limits, and important considerations when moving.
床スラブ厚と上階の足音問題——賃貸で「ドン」という衝撃音が響く構造的な理由と物件選びのポイント
前橋・群馬の賃貸エリアガイド【2026年版】——主要エリア別家賃相場と住みやすさを徹底比較
Making the Most of Protruding Beams and Columns in Rental Apartments — Smart Furniture Placement Strategies
Mito & Ibaraki Rental Area Guide [2026] — Comprehensive Explanation of Rental Rates and Livability by Major Area
Uncovering Property Issues by Asking Previous Tenants About Their Departure—Questions to Ask During Viewings and How to Interpret Answers
