# Home Office Deduction (家事按分) Japan 2026: Calculate Work-From-Home Expenses

> Learn how to calculate Japan's home office deduction (kajianbu) for remote workers. Deduct rent, electricity, and internet using floor area or time-based allocation methods.

- URL: https://denpyo.com/en/blog/home-office-deduction-kajianbu-2026
- Published: 2026-02-03
- Language: en

> **Disclaimer**: This article provides general information only and does not constitute tax or legal advice. Please consult a qualified tax professional (zeirishi) for your specific situation.

### Introduction: How Much of Your Home Expenses Can You Deduct?

"I work from home, but can I deduct rent and electricity as business expenses?"

Since the pandemic, remote work has become common. For freelancers and sole proprietors working from home in Japan, **家事按分** (kajianbu / home office allocation) is a crucial tax-saving opportunity that many foreigners overlook.

**What you'll learn in this article:**

- What 家事按分 (home office allocation) is

- Types of expenses you can allocate

- Specific calculation methods (floor area vs. time-based)

- Points for tax audit approval

- Common mistakes to avoid

### 1. What is 家事按分 (Home Office Allocation)?

#### 1.1 The Basic Concept

**家事按分** (kajianbu) is a method of **splitting expenses according to your business use ratio** when you use your home for both business and personal life.

For example, if you pay ¥100,000 rent and use 30% of your home for work, you can deduct **¥30,000 per month as a business expense**.

#### 1.2 Why Allocation is Required

For tax purposes, only **expenses directly related to business** are deductible. Since home rent and utilities include personal use, you cannot deduct the full amount.

**Benefits of Home Office Allocation:**

- Deduct home expenses even without a separate office

- Properly calculated ratios hold up in tax audits

- Significant tax savings potential

### 2. Types of Expenses You Can Allocate

| Expense | Allocation Method | Notes |
| --- | --- | --- |
| **Rent** | Floor area | Work room area ÷ Total area |
| **Electricity** | Floor area or Time | Either method acceptable |
| **Gas** | △ Limited | Only if used for business |
| **Water** | △ Limited | Only if used for business |
| **Internet** | Time-based | Work hours ÷ Total usage hours |
| **Mobile phone** | Time or Call records | Business usage percentage |
| **Mortgage interest** | Floor area | Principal not deductible, interest only |
| **Property tax** | Floor area | If you own the property |
| **Fire insurance** | Floor area | Both owned and rented |

### 3. Calculation Method: Floor Area Allocation

#### 3.1 Basic Formula

Deductible Amount = Total × (Work Space Area ÷ Total Home Area)

#### 3.2 Example: Rent Calculation

**Conditions:**

- Total home area: 60㎡

- Work room area: 12㎡

- Monthly rent: ¥120,000

**Calculation:**

Allocation ratio = 12㎡ ÷ 60㎡ = 20% Monthly expense = ¥120,000 × 20% = ¥24,000 Annual expense = ¥24,000 × 12 months = ¥288,000

**Tax Savings** (at 20% income tax rate):

¥288,000 × 20% = ¥57,600 in tax savings

#### 3.3 When You Don't Have a Dedicated Work Space

You can still allocate expenses even if you work in a corner of your living room.

**Methods:**

- Measure the area where your desk is placed

- Or use: Room area × Percentage of time used for work

### 4. Calculation Method: Time-Based Allocation

#### 4.1 Basic Formula

Deductible Amount = Total × (Work Hours ÷ Total Usage Hours)

#### 4.2 Example: Electricity

**Conditions:**

- Monthly electricity: ¥15,000

- Daily hours at home: 16 hours

- Daily work hours: 8 hours

**Calculation:**

Allocation ratio = 8 hours ÷ 16 hours = 50% Monthly expense = ¥15,000 × 50% = ¥7,500 Annual expense = ¥7,500 × 12 months = ¥90,000

#### 4.3 Example: Internet

**Conditions:**

- Monthly internet: ¥5,000

- Weekly work hours: 40 hours

- Weekly personal hours: 20 hours

**Calculation:**

Allocation ratio = 40 hours ÷ 60 hours = 66.7% (round to 70%) Monthly expense = ¥5,000 × 70% = ¥3,500

### 5. Points for Tax Audit Approval

#### 5.1 Have Reasonable Basis

In a tax audit, you need to explain the **reasonable basis** for your allocation ratio.

**Accepted Bases:**

- Floor plan showing work space area

- Calendar or work records

- Call history (for mobile phone)

#### 5.2 Keep Supporting Documents

| Document | Purpose |
| --- | --- |
| Floor plan | Basis for area allocation |
| Lease agreement | Proof of rent amount |
| Utility bills | Proof of amounts |
| Work diary/time records | Basis for time allocation |

#### 5.3 Allocation Ratio Guidelines

Generally accepted allocation ratios:

| Expense | Typical Ratio |
| --- | --- |
| Rent | 10%-50% |
| Electricity | 20%-50% |
| Internet | 50%-80% |
| Mobile phone | 30%-70% |

⚠️ **Warning**: Excessively high ratios may be denied during tax audits.

### 6. Annual Home Office Deduction Simulation

**Typical Freelancer Case:**

| Expense | Monthly | Ratio | Monthly Deduction | Annual Deduction |
| --- | --- | --- | --- | --- |
| Rent | ¥100,000 | 25% | ¥25,000 | ¥300,000 |
| Electricity | ¥12,000 | 40% | ¥4,800 | ¥57,600 |
| Gas | ¥5,000 | 10% | ¥500 | ¥6,000 |
| Water | ¥4,000 | 10% | ¥400 | ¥4,800 |
| Internet | ¥5,000 | 70% | ¥3,500 | ¥42,000 |
| Mobile | ¥8,000 | 50% | ¥4,000 | ¥48,000 |
| **Total** |  |  | **¥38,200** | **¥458,400** |

**Tax Savings** (at 20% income tax + 10% residence tax = 30%):

¥458,400 × 30% = Approximately ¥137,500 in tax savings

### 7. Frequently Asked Questions

#### Q1: Can I allocate expenses for rental housing?

**A**: Yes, you can. Home office allocation works for both rental and owned property.

#### Q2: Can I deduct mortgage payments?

**A**: Mortgage **principal is not deductible**, but the **interest portion can be allocated and deducted**.

#### Q3: Can I change the allocation ratio every year?

**A**: Yes, if your situation changes. However, significant changes require clear justification.

#### Q4: Can I use allocation for side jobs?

**A**: Yes, if filing as business income. However, side jobs filed as miscellaneous income may not qualify.

#### Q5: What about condo management fees?

**A**: Management fees can be allocated and deducted the same as rent.

### 8. Cautions and Common Mistakes

#### 8.1 What NOT to Do

❌ **Deduct the full amount** — Allocation is always required

❌ **Set high ratios without basis** — Risk of denial in audit

❌ **Change ratios every month** — Consistency required

❌ **Fail to keep records** — Can't explain during audit

### Summary

With proper home office allocation, remote workers can save **tens of thousands of yen per year** in taxes.

**Key Takeaways:**

1\. **Choose floor area or time allocation** — Select appropriate method for each expense 2. **Set reasonable ratios** — Too high risks denial 3. **Keep supporting documents** — Floor plans, contracts, work records 4. **Be consistent** — Use same calculation method each year 5. **Consult a professional** — Ask a tax accountant if unsure

**2026 Tax Filing Deadline**: **March 16 (Monday)**

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*Last updated: February 2026*

*Author: Denpyo Content Team*