Housing Loan Tax Credit Extended 5 Years (to 2030 Occupancy): Existing Homes Expanded, Floor Area Eased to 40 sq mThe "loan tax break" for buying a home will continue for 5 more years
Under the FY2026 (Reiwa 8) tax reform, the housing loan tax credit is extended by five years and applies to homes occupied from January 1, 2026 to December 31, 2030. For energy-efficient existing homes the credit period is expanded to 13 years, and the floor area requirement is eased to 40 sq m or more. The related tax law was enacted on March 31, 2026.
- January 1, 2026Start of the occupancy dates covered by the extended credit
- 2028 (Reiwa 10) onwardFrom occupancy in 2028, new homes in disaster red zones are excluded; new energy-standard-compliant homes with building confirmation are also excluded
- June 30, 2028Energy-standard-compliant homes with a registered construction date up to this day remain covered
- December 31, 2030Occupancy deadline (after the five-year extension)
Key points
- The deadline is extended by five years: occupancy from January 1, 2026 to December 31, 2030. The credit rate is 0.7%
- For energy-efficient existing homes, the borrowing limit is raised and the credit period is expanded to 13 years. Extra amounts apply to households raising children or young couples (a household with a child under 19, or where either spouse is under 40)
- The floor area requirement is eased to 40 sq m or more. However, people with total income over JPY 10 million and those using the child-raising or young-couple top-up need 50 sq m or more
- For new homes, energy-standard-compliant homes whose building confirmation is obtained in 2028 (Reiwa 10) or later are excluded (those with a registered construction date up to June 30, 2028 are covered). For occupancy from 2028, new homes in disaster red zones are also excluded (rebuilds, existing homes and renovations are covered)
- The investment-type tax credit for certified homes is also extended by three years, and homes in disaster red zones are excluded
What to do in practice
- Sort out the occupancy date, the timing of building confirmation and whether the home is new or existing to check eligibility
- Check the specific borrowing limits and credit periods in publications such as MLIT's outline of the FY2026 housing tax reform
When you borrow money to buy a home, there is a system that lowers your yearly tax according to how much of the loan is left. This system has been extended by five years, to people who move in by 2030. Used homes with high energy-saving performance also get better rules.
- ○Applies: You move in between January 2026 and December 2030
- ○Applies: The home is 40 sq m or larger
- ×Does not apply: A high-income person wants to use it for a home in the 40 sq m range (50 sq m or more is needed)
- ×Does not apply: A new home you move into in 2028 or later is inside a disaster red zone
Points
- People who start living in the home between 2026 and 2030 can use this system
- For used homes with high energy-saving performance, the period of the tax break became longer, 13 years
- The size of the home can now be 40 sq m or more (50 sq m or more for people with high income and some others)
What the words mean
- Housing loan tax credit
- A system that lowers your tax according to the remaining loan you borrowed to buy a home
- Disaster red zone
- An area officially decided to have an especially high risk of landslides, flooding and similar disasters
- Ministry of Land, Infrastructure, Transport and Tourism (MLIT): MLIT: Cabinet approval of the extension and expansion of the housing loan tax credit
- Ministry of Land, Infrastructure, Transport and Tourism (MLIT): MLIT: Outline of the FY2026 (Reiwa 8) tax reform
This article summarizes and explains materials published by government agencies and is not advice on any individual case. Rules can change, so for actual procedures and decisions always check the latest original materials and consult professionals such as tax accountants or labor and social security attorneys. English, Simplified Chinese and Traditional Chinese versions are translations prepared from the Japanese articles for convenience. If anything differs, the Japanese text and the original source take precedence.