Buying Australian property from Japan: FIRB, the tax agreement and sending yen abroad

Where Japanese buyers stand under FIRB

The ATO treats you as a foreign person if you are buying Australian property and are not an Australian citizen, an Australian permanent resident or a New Zealand citizen with a special category visa. It adds that a permanent resident who is not ordinarily resident in Australia may still be a foreign person in some circumstances.

Treasury's key concepts guidance (version 5, 12 December 2025) sets the test. A person counts as ordinarily resident only if they were in Australia for at least 200 days of the previous 12 months and their stay is not subject to a time limit. A Japanese citizen with a permanent visa who lives mainly in Japan can therefore still be a foreign person. The guide on who counts as a foreign person covers the edges.

What approval allows depends on the property. Treasury's residential land guidance (version 5, 1 July 2026) says new dwellings are not usually approved with conditions on how they are used, and vacant land is generally approved on condition that construction is completed within four years. Established dwellings are generally banned until 30 June 2029, with limited exceptions such as redevelopment that adds at least 20 dwellings. Where a developer holds an exemption certificate, the ATO says a buyer of a new dwelling does not need to apply if the price is under $3 million: see exemption certificates. Costs are on the fees page.

Japanese citizens on temporary visas in Australia are foreign persons too. Treasury defines a temporary resident as someone whose visa lets them stay more than 12 continuous months. See temporary residents.

Three yen thresholds on the Japanese side

Japanese law sets reporting points that can apply to a transfer for an Australian purchase.

None of these is a cap on how much may be sent. They are notification and reporting points. The Foreign Exchange and Foreign Trade Act states its basic principle as free engagement in foreign exchange and other international transactions, with only the minimum necessary controls (Article 1).

What the bank asks when you send yen abroad

Under Article 3 of the 1997 Act, a person sending money abroad gives the bank a notification form with their name, address, individual number (My Number) and the transaction or act behind the remittance. The bank checks those details against documents such as a copy of your residence record (jūminhyō), another document the Cabinet Order allows, or an electronic certificate. The Act excludes certain transfers made from an account in your own name that the bank has already verified, so whether the form is needed can depend on how the money is sent.

For a transfer above JPY 1 million, Article 4 requires the bank to file a statement with its local tax office, and that statement includes the remittance reason given on your form. The reason you give for a house purchase is therefore recorded in what the bank files.

The payment reporting system is separate. Article 55 of the Foreign Exchange and Foreign Trade Act requires reports of payments sent abroad, except as the Cabinet Order provides, and says that where a payment goes through a bank the report is made through the bank. The Ministry of Finance ordinance treats payments of JPY 30 million or less as small payments that need no report. For a larger transfer, the bank is the place to ask how the report will be handled.

The Japan-Australia tax agreement

Treasury lists the Japan agreement as signed on 31 January 2008 and in force from 3 December 2008. Japan's Ministry of Finance publishes a synthesised text that combines it with the multilateral instrument, and says that text is a convenience and not a source of law. Three articles matter to a property owner:

• Article 6: income from real property, including income from letting it, may be taxed in the country where the property is.
• Article 13: gains from selling real property may be taxed where it is, and the same goes for shares or interests that derive at least 50 per cent of their value from real property there.
• Article 25: Japan allows a credit against Japanese tax for Australian tax paid on income that may be taxed in Australia under the agreement, within Japan's own credit rules and limited to the part of Japanese tax that relates to that income.

So Australia may tax the rent and any gain, and Japan credits that tax against its own tax on the same income. The agreement also has a limitation on benefits article (Article 23): an individual is automatically a qualified person, while companies and other entities have to meet further tests. The sister guide on Australian tax on property held from overseas covers the Australian side.

Reporting an Australian property in Japan

Report on Foreign Assets. Article 5 of the 1997 Act requires a resident of Japan, other than a non-permanent resident, who holds foreign assets worth more than JPY 50 million at 31 December to file the report with the tax office by 30 June of the following year. The Act defines a foreign asset as property located outside Japan, and the test is the total of all such assets, so an Australian home is counted together with everything else held abroad.

Overseas rental buildings. Under Article 41-4-3 of the Special Taxation Measures Act, from 2021 an individual with rental income from an overseas used building who makes a loss has the part of that loss equal to depreciation treated as not having arisen. It cannot be set against other income. The law defines an overseas used building as a building abroad that an individual has used, or a company has used in its business, before the owner acquired it. How the rule treats a brand-new dwelling bought off the plan is a question for a Japanese tax adviser, because the definition is written around buildings already in use.

Names, ID and language

The ATO lists a passport among the attachments for a new dwelling application. It treats correcting a spelling error in a purchaser's name as a simple variation, which costs $4,600 for 1 July 2026 to 30 June 2027. If your name appears in Japanese script on some documents and in Roman letters on others, the spelling on the passport, the contract and the application is worth matching before anything is lodged. The form also has to be completed in one session and times out after 25 minutes of no activity.

Japan has been a party to the Apostille Convention since 27 July 1970 and Australia since 16 March 1995, so Japanese public documents can carry an apostille instead of consular legalisation. Whether a particular document needs one is a question for the Australian conveyancer.

The Australian Embassy in Tokyo says its notarial services cover only documents created in Australia or that must be submitted in Australia, by appointment, with valid photo identification. Its page does not mention land-transfer identity checks, so the method a transaction uses is something the conveyancer or lender sets out.

The ATO's other languages page lists Japanese, and says you can use the Translating and Interpreting Service to speak to the ATO in a language other than English. The application pages cited in this guide are in English.

Frequently asked questions

firbapproval.com.au is an independent guide. It is not affiliated with, endorsed by or connected to the Foreign Investment Review Board, the Australian Treasury or the Australian Taxation Office. We do not lodge or process applications. Applications are made to the ATO. General information only, not legal, tax, migration or financial advice.