Japan Tax Bulletin

Restriction on the offset of a loss from investments in overseas second-hand buildings, .....

The 2020 Tax reform closed a loophole for wealthy individual taxpayers who used investments in offshore second-hand buildings to reduce their income tax liability. Losses generated by these investments can be used to offset against other types of income and reduce a taxpayer’s total tax liability. The loophole relied on the accelerated depreciation deductions that could be taken for a second-hand building that was either nearing, or had reached, the end of its statutory useful life.

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