We are Murata Sogo Tax Accounting Office, a tax accounting firm specializing in inheritance and international taxation, with an office in Miyakojima-ku, Osaka City.
In this issue, we would like to provide an explanation of the new law that began on April 1, 2024, making it obligatory to apply for inheritance registration.

1 Introduction

The Act for Partial Revision of the Civil Code, etc. (Act No. 24 of 2021, hereinafter referred to as the "Revised Act") was enacted on April 1, 2024. The law was enacted in phases beginning in April 2023, and the obligation to apply for inheritance registration finally began on April 1, 2024.

The Revised Law amended the Real Property Registration Law from the perspective of establishing a mechanism to prevent the occurrence of land with unknown owners, and established the "heir declaration registration" system as one of the measures to improve the environment to ensure the effectiveness of the obligation to apply for inheritance registration, which was previously considered optional. This article confirms the obligation to apply for inheritance registration and provides an overview of the heir declaration registration to fulfill the obligations owed by heirs by means other than applying for registration.

2 Obligation to apply for inheritance registration

(1) Basic Obligations

The first sentence of Article 76-2(1) of the Real Property Registration Law of the Revised Law states, "When inheritance has commenced with respect to the registered owner of ownership, the person who has acquired ownership through such inheritance shall, within three years from the date on which he/she became aware that inheritance has commenced for him/her and has acquired such ownership, apply for registration of transfer of ownership by . shall apply for registration of transfer of ownership." The second sentence of the same paragraph shall read, "A person who has acquired ownership through a bequest (limited to a bequest to a person other than an heir) shall be deemed to have acquired ownership through a bequest to an heir. The second sentence of the same paragraph states, "The same shall apply to a person who has acquired ownership by bequest (limited to a bequest to a person other than an heir). The second sentence of the same paragraph stipulates that

Therefore, heirs who may be obliged to apply are heirs to the registered titleholder of ownership of the relevant real estate, and heirs to registered titleholders other than ownership (e.g., mortgage holders) are not subject to this obligation.

In addition, although not explicitly stated in the article, heirs who acquired ownership through inheritance or bequest, as well as heirs who acquired ownership through a specific property succession will (i.e., a will that specifies a specific property to be inherited by a specific heir as the method of dividing the estate) are naturally subject to the obligation to apply.

Next, as for the starting point of the three-year period for the performance of the obligation to apply,
(1) Knowing that the inheritance has commenced for one's own benefit
(2) Knowledge of the acquisition of ownership of the property in question
However, it is understood that the period of performance of the obligation to apply does not run even if the heir did not know the existence of the real estate due to negligence.

Furthermore, it should be noted that the acquisition of ownership of real estate is not limited to heirs who directly acquired it from the decedent, but also includes heirs in cases where the decedent's heirs died without registering the inheritance, such as in the case of multiple inheritance. The obligation to apply for inheritance registration is subject to the provisions of the Order on the Registration of Inheritance.

This obligation to apply is also applicable to cases where real estate was acquired through inheritance that began before April 1, 2024. However, due to transitional measures in the revised law, there is a grace period of three years from either the effective date of the obligation to apply (April 1, 2024) or the date when the requirements in 1) and 2) above are fulfilled, whichever is later, Therefore, the fine described below will not be applied until April 1, 2027 at the earliest.

(2) Obligation for Division 

However, the obligation to apply for registration of inheritance is not limited to the basic obligation in (1), but even after registration based on the statutory inheritance share in paragraph 2 of the same article, "A person who has acquired ownership in excess of the statutory inheritance share through division of the estate shall apply for registration of transfer of ownership within three years from the date of division of said estate." This provision stipulates that

This obligation at the time of the division of the estate is a different obligation from the basic obligation, but if the division of the estate is completed within the performance period of the basic obligation, the basic obligation will be fulfilled by performing the obligation at the time of the division of the estate. Therefore, the general practical treatment would be to conclude a legacy partition agreement within three years after the commencement of inheritance and register the transfer of ownership from the decedent to the party who acquired the ownership of the property through the legacy partition agreement. On the other hand, if a legacy partition agreement cannot be reached within the period for fulfillment of the basic obligation, the initial obligation to apply for inheritance registration is to be fulfilled by registering the transfer of ownership according to the statutory inheritance shares as the basic obligation in (1) or by registering the declaration of heirs, which will be described later.

(3) Application of Excessive Provisions and Penalties

Failure to comply with the application obligations described in (1) and (2) without justifiable reason is subject to a fine of up to 100,000 yen (Article 164, Paragraph 1 of the Non-Registration Law). Unlike criminal penalties, a fine is an administrative penalty. However, since its significance is to maintain discipline concerning the accomplishment of administrative facilities and the implementation of measures, a fine may be imposed regardless of whether or not there is a justifiable reason for not fulfilling the obligation to apply for registration.

3 Establishment of Registration of Declaration of Inheritance

Since the mandatory application for inheritance registration imposes a new burden on the public and from the perspective of ensuring the effectiveness of the obligation to apply, a new registration called "heir declaration registration" has been established to simplify the fulfillment of the heir's obligation to apply.

(1) Overview

Specifically, a person who is obligated to apply for registration of transfer of ownership due to inheritance shall declare to the registrar that inheritance has commenced with respect to the registered owner of ownership and that he/she is the heir of said registered owner of ownership (hereinafter referred to as "heir declaration"). (Article 76-3, Paragraph 2 of the Non-Transfer Law). When such an offer is made, the registrar shall, ex officio, add to the registration of ownership a statement to that effect, the name and address of the person who made such offer, and other matters specified by a Ministry of Justice ordinance (Article 76-3, Paragraph 3 of the Notary Act).

Although it can be said that the heir's declaration is a newly established system as a one-way method to prevent the occurrence of owner-unknown land, it does not exempt the heir from the obligation to apply for registration of transfer of ownership in the event that an inheritance division agreement is held after the heir's declaration, as described below.

(2) Contents of the Declaration

(1) Name and address of the applicant, (2) name and address of the agent if the application is made by the agent, (3) indication of the real estate pertaining to inheritance that is the subject of the application, (4) information proving that the registered owner of the real estate pertaining to the application is the decedent, and (5) if there is an intermediate heir, information proving that the registered owner of the real estate pertaining to the application is the (5) information certifying that the registered owner of the real estate to which the request pertains is the heir to the deceased, (6) information certifying the authority of the representative if the request is made by a representative, and (7) the above items must be clearly stated in the request.

When making an actual application, the following information must be provided in addition to the form of application for heirs as shown in the attached sheet.

(a) Information certifying that the applicant is the heir to the registered owner of the title
(b) Information certifying the address of the heir
(c) Information evidencing the authority of the representative if the request is made by a representative

(3) Method of Filing an Application

As with an application for registration, heir notification may be submitted either in writing or electronically (Article 158-2 of the Non-Tojin Regulations). In order to reduce the burden on the applicant, it is understood that neither a seal on the application form nor an electronic signature is required for an electronic application, and since the heir's declaration is accompanied by the effect of exemption from registration, it is considered to be within the scope of the heir's simple fulfillment of his/her application obligation.

It is also stipulated that if, after the heir's offer has been made, the estate is subsequently divided and the heir becomes obligated to apply for registration, he/she must apply for registration of transfer of ownership within 3 years from the date of such offer.

(4) Request for Change (correction) and Cancellation

With regard to the registration of declaration of heirs, as in the case of other registrations, a request for a change in the matters of heirs' declaration may be filed with regard to matters requiring a change or cancellation of ownership with regard to the contents of the declaration, for example, if the address of the heirs has changed (Article 158-28 of the Non-Trusteeship Ordinance).

 

The most important feature of real estate registration remains the ability to obtain opposition requirements, but the revised law imposes the obligation to apply for registration regardless of the intention of the parties with regard to inheritance registration.
We also work with judicial scriveners as needed, so if you have any problems with registration application as well, please contact us through the inquiry form.