In rental property management, correctly understanding flooring lifespan, replacement timing, and the allocation of restoration costs is important for both cost control and trouble prevention.
Does flooring have a statutory useful life?
Flooring does not have a statutory useful life.According to guidelines from the Ministry of Land, Infrastructure, Transport and Tourism, in principle, regardless of the years elapsed, restoration is limited to the specific areas damaged by the tenant. However, when full replacement is carried out, value is considered to be restored, so the elapsed years based on the building structure are taken into account.
General durability benchmarks by flooring material
Although there is no statutory useful life, in practice the following durability periods serve as benchmarks.
- Engineered flooring: 10 to 15 years (plywood base material + natural wood veneer finish)
- Solid wood flooring: 30 years or more (because it is a natural material, scratches can be repaired through sanding)
If solid wood flooring has a natural oil finish, it can be used over the long term when combined with waterproof maintenance. Engineered flooring is also affected by adhesive deterioration, making it relatively less durable.
How should you determine the right timing to replace flooring?
Useful life is only a benchmark, and the actual replacement decision should be based on the condition of the property.
Signs that indicate replacement should be considered
- When scratches or stains have reached a level that interferes with daily living: leaving them unaddressed increases the risk of trouble or injury
- Discoloration caused by sun exposure or fading: if boards are beginning to lift or peel, functional problems also arise
- When creaking sounds occur: since deterioration may involve not only the floorboards but also structural components, consultation with a specialist contractor is necessary
Flooring restoration costs: allocation between landlord and tenant
This is one of the areas most likely to cause disputes when a tenant moves out of a rental property. Thorough pre-move-in inspections are important to prevent trouble before it arises.
Cases borne by the owner (landlord)
- Dents and placement marks caused by furniture installation (within the scope of ordinary use)
- Discoloration or dark staining caused by structural defects or condensation
- Scratches and fading caused by aging and natural wear and tear
Cases borne by the tenant
- Stains and soiling caused by insufficient care
- Scratches or dents caused intentionally or through negligence (such as dents caused by chairs with casters)
- Stains from liquids and similar substances caused by carelessness
When the tenant bears the cost, it is applied against the security deposit paid at move-out. If the cost exceeds the security deposit, an additional charge will be billed.
Recommended reading
- A Must-Read for Landlords: A Complete Guide to the "Pre-Move-In Inspection" That Can Determine Success or Failure in Rental Management
- Restoration Costs for Equipment Installation in Rental Housing: Allocation Rules Owners Should Understand
- What Is Urethane Waterproofing? A Thorough Guide to Types, Costs, and Contractor Selection for Condominium Waterproofing Work
Why flooring is treated differently for depreciation
You may have heard that wallpaper (クロス, kurosu — vinyl wall covering) is worth almost nothing after six years. Flooring is not treated the same way. The Ministry of Land, Infrastructure, Transport and Tourism (国土交通省, Kokudō-kōtsū-shō / MLIT) “Guideline on Disputes Concerning Restoration to Original Condition” (原状回復をめぐるトラブルとガイドライン, genjō kaifuku — restoration to the original state) draws a clear line: flooring is an item “for which elapsed years are not taken into account”.
The guideline explains the reason as follows. Even after a patch repair, flooring is in practice replaced in full later on, and a patch repair does not raise the value of the flooring as a whole (it leaves a patched surface). Charging the tenant the full cost of the patch therefore does not give the landlord a benefit beyond the flooring’s value at that point.
| Scope of repair | Whether elapsed years (depreciation) are considered | Tenant’s share |
|---|---|---|
| Patch repair (damaged spots only) | Not considered | The full cost of the patch repair |
| Damage across the whole floor, requiring full replacement | Considered | The share read off the straight line that runs residual value down to 1 JPY over the useful life of the building |
Source: MLIT (国土交通省), 「原状回復をめぐるトラブルとガイドライン（再改訂版）」 (“Guideline on Disputes Concerning Restoration to Original Condition (Revised Edition)”) (August 2011 / Heisei 23)
This is the point that is misread in practice. The idea that “I have lived here six years, so I need not pay for flooring scratches” does not hold for patch repairs. Even in year 10 of occupancy, the cost of repairing a scratch caused by the tenant’s negligence is, in principle, borne in full by the tenant.
The same logic applies to fusuma paper (襖紙), shōji paper (障子紙) and tatami facing (畳表). These items have a strong consumable character, and the drop in value is large regardless of how light or heavy the damage is, so a depreciation approach is said not to fit.
Two Kinds of Flooring "Depreciation": the Move-Out Calculation and the Tax Return
Search "flooring depreciation" and two unrelated topics come back tangled together. One is the depreciation used to work out how much of a repair bill a tenant owes at move-out. The other is the depreciation an owner claims on a tax return. Different rules, different decision-makers, different questions — English just happens to reuse one word for both.
If you already rent out property in the United States or the United Kingdom, you have met this split before, just under different names. "Normal wear and tear," which decides what a landlord may deduct from a security deposit, has nothing to do with the 27.5-year straight-line schedule your accountant uses under MACRS, or the equivalent UK capital-allowances treatment. Nobody expects those figures to match, because everybody treats them as separate systems. Japanese guidance uses one family of vocabulary — 減価 (genka) and 減価償却 (genka shōkyaku), both translating loosely as "depreciation" — for both ideas, which is exactly why Japanese search results run them together.
| Move-out (restoration) depreciation | Tax depreciation | |
|---|---|---|
| What it decides | How much of a repair bill the tenant pays at move-out | When and how the owner can deduct the cost against rental income |
| Where it comes from | MLIT's "Guideline on Disputes Concerning Restoration to Original Condition" — official guidance, not a statute | The Ministerial Ordinance on Useful Lives of Depreciable Assets, together with the Income Tax Act and Corporation Tax Act enforcement orders |
| How flooring fares | A patch repair ignores years elapsed entirely; a full replacement uses the useful life of the building itself | Classified as a repair expense, it is deducted in full the year it is paid; classified as a capital improvement, it is depreciated over the building's own useful life |
| When it comes up | Move-out settlement and security-deposit accounting | Filing a tax return |
| Who is on the other side of the table | The tenant | The tax office |
The overlap in the actual numbers makes this worse, not better. A move-out settlement citing "22 years, because it's a wood-frame building" is the restoration guideline talking. A tax return citing the same "22 years, wood-frame building" is the tax rules talking. The number can be identical while the question it answers is completely different — one decides the tenant's share of a repair bill, the other decides how the owner's bookkeeping spreads out an expense.
Everything up to this point has been about the first kind — restoration depreciation, and what a tenant actually owes. The second kind, tax depreciation, is covered later, in "Owner's Tax Treatment: Is a Flooring Replacement a 'Repair Expense' or a 'Capital Improvement'?"
Useful lives by fixture — which items are six years, and which are not
The guideline lists useful lives (耐用年数, taiyō nensū — statutory service life) for the main fixtures. Lining them up against other parts of the dwelling makes the flooring treatment easier to see.
| Useful life | Items |
|---|---|
| 5 years | Kitchen sink unit |
| 6 years | Cooling and heating equipment (air conditioners, room coolers, stoves and the like), electric refrigerators, gas appliances (gas ranges), intercoms, carpet, wallpaper (クロス) |
| 8 years | Furniture that is not mainly metal (bookcases, chests of drawers, cupboards, tea cabinets) |
| 15 years | Toilets, washbasins and other water-supply, drainage and sanitary fittings; mainly metal fixtures and equipment |
| The useful life of the building | Unit bathrooms, bathtubs, shoe cupboards (where fixed to the building and inseparable from it), full replacement of flooring |
| Not considered | Patch repair of flooring, fusuma paper, shōji paper, tatami facing, replacement of a lost key, cleaning |
There is a history behind the residual value of “1 yen” (1 JPY, a purely nominal residual). Residual value after depreciation used to be calculated as 10%, but the 2007 (Heisei 19) tax reform abolished residual value and allowed assets to be written down to a remaining book value of 1 yen at the end of the useful life. The guideline was aligned with that change. Older articles sometimes say “after six years, 10% remains”; that is not the current approach.
A Material-by-Material Breakdown — Why "The Floor" Can Mean Opposite Answers
The guideline's official schedule (Appendix Table 2) groups "tatami, flooring, carpet and the like" under one heading, then gives each material its own rule for whether elapsed years matter and how the tenant's share is measured. Only two materials on that table are treated as immune to elapsed years at all: a tatami facing sheet, and a patch repair of flooring. Everything else — a tatami mat core, carpet, cushion flooring, and a full flooring replacement — is written down toward a nominal residual value over time.
| Flooring material | Are elapsed years considered? | Tenant's unit of charge |
|---|---|---|
| Tatami facing (omote) | No — treated as a consumable, not something you depreciate | Per damaged mat (whether it's flipped or re-faced depends on how bad the damage is) |
| Tatami mat core (toko) | Yes — a straight line down to a nominal residual value over 6 years | Minimum of one full mat |
| Carpet | Yes — 6 years to a nominal residual value | Per room |
| Cushion flooring (vinyl sheet) | Yes — 6 years to a nominal residual value | Per room |
| Flooring, patch repair | No | Normally per square meter; if damage spans multiple spots, the whole room |
| Flooring, full replacement | Yes — the building's own useful life, down to a nominal residual value | The whole room |
This table earns its keep in two separate ways.
The first is figuring out how far the "six years" rule actually reaches. Live in a room with cushion flooring or wall-to-wall carpet for six years, and your share of the repair bill has shrunk to almost nothing. Live in the exact same layout with the exact same scuff marks, but the floor is hardwood-look flooring needing only a patch repair, and those six years buy you nothing — the years-elapsed rule simply does not apply to a patch job. Swap the material and the outcome flips, even though nothing else changed. This is the single most common reason "I've lived here six years, so I don't owe anything for the floor" turns out to be wrong: the speaker is quoting the carpet rule for what is actually a hardwood floor.
The second is the unit the charge is measured in. Flooring is billed per square meter, but if the damage is scattered, the charge expands to cover the entire room. Carpet and cushion flooring are billed per room from the outset; tatami is billed per mat. Complaints like "there was one scratch, and they billed me for the whole room" usually trace back to nobody agreeing on which unit applied before the settlement conversation started.
One more figure worth holding onto: the guideline states plainly that "the final residual value is set at 1 yen, and the tenant's share never falls below 1 yen." The longer the tenancy, the smaller the share gets — but on paper it approaches zero without ever technically reaching it.
The tenant’s share on a full replacement — worked examples by building structure
When the whole floor is replaced, the tenant’s share is calculated using the useful life of that building. The assumption is that the floor was new at move-in; a straight line is drawn down to a residual value of 1 yen at the end of the useful life, and the years already elapsed are subtracted.
Tenant’s share = (1 − elapsed years ÷ statutory useful life of the building) × 100
| Building structure | Statutory useful life | Share at 6 years of occupancy | At 12 years of occupancy |
|---|---|---|---|
| Wood or synthetic-resin construction | 22 years | approx. 73% | approx. 45% |
| Timber-frame mortar construction | 20 years | approx. 70% | approx. 40% |
| Metal construction (frame 3 mm or less) | 19 years | approx. 68% | approx. 37% |
| Metal construction (frame over 3 mm up to 4 mm) | 27 years | approx. 78% | approx. 56% |
| Metal construction (frame over 4 mm) | 34 years | approx. 82% | approx. 65% |
| Brick, stone or block construction | 38 years | approx. 84% | approx. 68% |
| Reinforced concrete | 47 years | approx. 87% | approx. 74% |
Source: statutory useful lives are those for residential buildings in the 減価償却資産の耐用年数等に関する省令 (Ministerial Ordinance on Useful Lives of Depreciable Assets; e-Gov Law Search); the calculation method follows the MLIT guideline
What the table shows is that the more robust the building, the higher the tenant’s share remains. In a wooden apartment, twelve years of occupancy cuts the share to less than half; in a reinforced-concrete condominium, about 74% still remains after twelve years. Because the useful life is longer, the write-down per year is smaller.
One premise must not be forgotten. This calculation appears only when there is damage across the whole floor and the whole floor is being replaced. A few scratches or dents are a patch-repair matter, and elapsed years are not considered. If at move-out you are billed for a full replacement with no deduction for elapsed years, check whether the damage really runs across the whole floor. Conversely, claiming “six years have passed, so my share is zero” on a patch repair will not stand under the guideline.
In addition, the tenant’s duty of care of a good manager (善管注意義務, zenkan chūi gimu) does not disappear just because a fixture has outlived its useful life. The guideline states that even for equipment past its useful life, if the tenant renders it unusable by intent or negligence, the cost of restoring it to the condition in which it still functioned (works and labour and the like) can fall on the tenant.
Owner's Tax Treatment: Is a Flooring Replacement a "Repair Expense" or a "Capital Improvement"?
This section moves to the tax side. Every time a tenant moves out, an owner must decide: can this year's flooring bill be deducted in full against this year's rental income, or must it be spread out — depreciated — over years or decades? The answer changes how much cash sits in the account this year, so no landlord in Japan, or anyone filing a Schedule E for a US rental property, gets to skip this question.
The starting point is the statute. Article 181 of the Order for Enforcement of the Income Tax Act excludes spending on a fixed asset from deductible expenses to the extent it (a) extends the asset's useful life, or (b) increases its value. That is a capital improvement (資本的支出, shihonteki shishutsu). Spending that merely maintains ordinary upkeep, or restores a damaged asset to its original condition, is instead a repair expense (修繕費, shūzenhi) (Basic Directive on Income Tax 37-11; on Corporation Tax 7-8-2). US readers will recognize this shape immediately — it lines up with the IRS's own repair-versus-improvement test, arrived at independently.
A Large Price Tag Alone Doesn't Make It a Capital Improvement
The National Tax Agency's own published Q&A has a strikingly on-point example. Re-papering the wallpaper throughout an entire rental apartment building, at a cost of 2 million yen, was ruled "acceptable to record in full as a deductible repair expense." The reasoning: even though the original wallpaper's cost was folded into the building's purchase price at acquisition, replacing worn wallpaper is ordinary maintenance, so the entire cost, however large, is a repair expense.
Flooring follows the same logic. A 2-million-yen bill can still be a repair expense, while a 200,000-yen bill can still be a capital improvement — if that cheaper job was really a renovation that changed how the space is used. Invoice size never decides the answer; what matters is whether the work restored the original condition or created something better than before.
Bright-Line Tests for the Genuinely Ambiguous Cases
Because "restoration versus improvement" is genuinely hard to apply in the moment, the tax authorities also publish bright-line safe harbors.
| Test | Threshold | Source |
|---|---|---|
| Minor amount | Under 200,000 yen for a single repair or improvement job | Income Tax Basic Directive 37-12(1) / Corporation Tax Basic Directive 7-8-3(1) |
| Short recurring cycle | Work that recurs roughly every 3 years or less, judged from the property's own track record | 37-12(2) / 7-8-3(2) |
| Formal threshold (¥600,000) | Where it is genuinely unclear whether spending is a capital improvement or a repair, amounts under 600,000 yen | 37-13(1) / 7-8-4(1) |
| Formal (10%) | Amounts no greater than roughly 10% of the asset's acquisition cost as of the prior year-end | 37-13(2) / 7-8-4(2) |
Source: National Tax Agency, Tax Answer No. 1379, "Determining What Does Not Count as a Repair Expense"; Corporation Tax Basic Directive, Section 8, "Capital Improvements and Repair Expenses"
There is a real practical takeaway here. Handling each unit's patch repair separately, move-out by move-out, tends to fit comfortably inside the safe harbors. A single unit's repair — typically tens of thousands to a little over 100,000 yen — usually clears the 200,000-yen threshold, so it can be expensed the year it is paid. Bundle several vacant units into one larger renovation instead, and the total for "a single job" jumps, edging the work toward "remodeling for a change of use" (Directive 37-10(2)) and raising the odds it gets classified as a capital improvement. The same total yen amount can land on either side of the line, purely depending on when and how you bundle the work.
If It Is Classified as a Capital Improvement, Over How Many Years Do You Depreciate It?
This is the answer to "how many years do you depreciate flooring." Short version: there is no line item for "flooring" anywhere in the useful-life tables.
Appendix Table 1 of the Ministerial Ordinance on Useful Lives of Depreciable Assets lists exactly ten categories of "building attached facilities": electrical facilities, water/drainage and sanitary facilities and gas facilities, air conditioning or boiler facilities, elevators, fire-extinguishing or disaster-warning facilities and evacuation equipment, air curtains or automatic door-closers, arcades or awnings, store fixtures, movable partitions, and a catch-all "other." There is no category for "flooring" or "floor finishes." Combined with the National Tax Agency's own reasoning above — that interior finishes are folded into the building's acquisition cost at purchase — the conclusion is that flooring counts as part of the building itself. In tax terms, flooring is neither a "consumable" nor "equipment" — it is the building.
Given that, Article 127, Paragraph 1 of the Order for Enforcement of the Income Tax Act treats a capital improvement "as though a new depreciable asset of the same type and useful life as the asset it was made to had been newly acquired" (for corporations, Article 55 of the Corporation Tax enforcement order). In plain terms: a capital improvement to the flooring of a wood-frame building is depreciated over the wood-frame residential figure; the same work on a reinforced-concrete condominium uses the reinforced-concrete figure instead.
| Building structure (residential) | Statutory useful life | Depreciation period for flooring capital improvements |
|---|---|---|
| Wood or synthetic-resin construction | 22 years | 22 years |
| Timber-frame mortar construction | 20 years | 20 years |
| Metal construction (frame 3 mm or less) | 19 years | 19 years |
| Metal construction (frame over 3 mm up to 4 mm) | 27 years | 27 years |
| Metal construction (frame over 4 mm) | 34 years | 34 years |
| Brick, stone or block construction | 38 years | 38 years |
| Steel-reinforced concrete or reinforced concrete | 47 years | 47 years |
Source: Ministerial Ordinance on Useful Lives of Depreciable Assets, Appendix Table 1 (e-Gov Law Search); the treatment of capital improvements is set out in Article 127, Paragraph 1 of the Order for Enforcement of the Income Tax Act
You cannot borrow the "6 years" that applies to carpet or an air conditioner and apply it to flooring. Just as flooring is the odd one out under the restoration guideline, it is the odd one out for tax purposes too — pulled toward the building's own timeline in both cases. That is not a coincidence: both frameworks rest on the same idea, that a floor is part of the building.
One last point for owners of older properties: even past a building's own statutory useful life, the repair-versus-capital-improvement test does not change. Corporation Tax Basic Directive 7-8-9 states that for an asset that has already exhausted its useful life, classifying further work "follows the same general rules." A fully depreciated wood-frame building can still trigger a fresh 22-year schedule if a later renovation is classified as a capital improvement.
Frequently Asked Questions (FAQ)
Q1. How many years is the useful life of flooring?
There is no statutory useful life. In practice, the benchmark is 10 to 15 years for engineered flooring and 30 years or more for solid wood flooring. In some cases, it is also considered in relation to the useful life of the building as a whole (such as 22 years for wooden structures and 47 years for reinforced concrete structures).
Q2. If the flooring is replaced throughout, does the tenant's cost burden become zero?
Because full replacement is regarded as restoring value, the elapsed years are taken into account, and the longer the occupancy period, the lower the tenant's share becomes. It never actually reaches zero, though. The guideline sets the final residual value at 1 yen and states that the tenant's share never falls below 1 yen — the number gets vanishingly small, but on paper it's designed to approach zero without technically touching it. It's also worth remembering that the tenant's duty of care as a good manager doesn't expire just because a fixture has outlived its useful life: if a tenant renders equipment unusable through intent or negligence, even after that equipment's useful life has ended, the cost of restoring it to working condition can still fall on the tenant.
Q3. If the flooring creaks, does the tenant need to fix it?
As a rule, creaking caused by aging and deterioration is borne by the owner. However, if it is caused by the tenant's improper use, such as placing excessively heavy items, the tenant may bear the cost.
Q4. Are dents caused by chairs with casters borne by the tenant?
The guideline's "Landlord-Tenant Repair Allocation Table" does not actually list "chairs with casters" anywhere. What that table assigns to the landlord's side is "dents and placement marks caused by furniture installation" — a mark simply left by something sitting in one spot is treated as ordinary wear. A groove worn into the floor by rolling a caster back and forth is not a "placement mark," so whether it counts as damage beyond normal use comes down to the tenant's duty of care, judged case by case. In short, you cannot say "the guideline puts this on the tenant" — that claim isn't actually in there. Floor mats or protective sheets are still worth using to prevent the marks in the first place, guideline or not.
Q5. As a rental owner, how should I decide when to replace flooring?
The best timing is during renovation after move-out. Because it affects recruitment of the next tenant, if there are noticeable scratches or discoloration, you should proactively consider replacement. It is also important to set aside reserves as part of planned repairs that take durability into account.
Q. Over how many years do you depreciate a flooring replacement for tax purposes?
If the work is classified as a repair expense, it is deducted in full the year you pay for it, with no depreciation at all. If it is a capital improvement, it is treated as a new asset of the same type and useful life as the building itself (Order for Enforcement of the Income Tax Act, Article 127, Paragraph 1; corporations, Article 55 of the corporate order) — 22 years for wood-frame, 47 years for reinforced concrete. There is no "flooring" category on the useful-life tables, so a shorter figure like 10 or 15 years cannot be used.
Q. Does the treatment change depending on the flooring material?
Yes. Under Appendix Table 2, a tatami mat core, carpet, and cushion flooring are all written down to a nominal residual value over 6 years, while a tatami facing sheet and a patch repair of flooring ignore elapsed years entirely. A full flooring replacement is the outlier: it alone uses the useful life of the building. The same word, "floor," splits three ways — 6 years, no depreciation, or the building's own useful life.
Q. Is it cheaper, tax-wise, to bundle several units' restoration work into one order?
Not necessarily — it can work against you. A safe harbor lets a single repair or improvement job under 200,000 yen be expensed as a repair (Income Tax Basic Directive 37-12(1); Corporation Tax Basic Directive 7-8-3(1)), so handling each unit's patch repair separately, as each tenant moves out, tends to fit comfortably inside that threshold. Bundle several units into one large renovation, and the total for "a single job" can push the work into capital-improvement territory instead — depreciated over the building's useful life rather than deducted immediately.
Q. After six years, does the tenant’s share of flooring fall to zero?
No. The MLIT guideline classifies patch repairs of flooring as items “for which elapsed years are not taken into account”. A patch does not raise the value of the flooring as a whole (it leaves a patched surface), so even in year 10 of occupancy the cost of repairing a scratch caused by the tenant’s negligence is, in principle, borne in full by the tenant. Elapsed years are considered only when damage runs across the whole floor and the whole floor is replaced.
Q. If the whole floor is replaced, how is the share calculated?
Use the statutory useful life of that building: “(1 − elapsed years ÷ statutory useful life) × 100”. For wood construction the useful life is 22 years, so about 73% after six years of occupancy and about 45% after twelve. Reinforced concrete is 47 years, so even after twelve years about 74% remains. Note that the yardstick itself is different from the six-year lives of wallpaper and carpet.
