Japan inheritance laws and dementia asset management

In Japan, the legal treatment of elderly care expenses during inheritance depends on whether the person providing care is a legal heir or a non-heir relative.

For legal heirs, caregiving that reduces the deceased's expenses can be claimed as a ‘contribution portion’ (kiyobun) during inheritance division negotiations. This is not automatic and requires agreement among heirs or court mediation.

For non-heir relatives, a system implemented in 2019 allows for a ‘special contribution fee’ (tokubetsu kiyoryo) to compensate for unpaid labor or nursing care. However, this applies specifically to labor; simply paying for care expenses does not qualify for this fee and must be settled through other legal means. Claims for special contribution fees are subject to strict time limits: within six months of learning about the inheritance and within one year of the death.

Additionally, the rise of dementia in aging populations has led to increased asset freezing. Experts suggest using ‘family trusts’ as a proactive measure to allow designated successors to manage and maintain real estate, avoiding the conflicts and management failures often seen when assets become inaccessible due to a lack of mental capacity.