Investing in Japan – Setting-up a business in Japan

The system for establishing a company in Japan has been made simple and reasonably straightforward. A business can be registered with as little as 1 yen in capital.

Can I open a company in Japan?

Yes, a non-resident can register a company subject to certain restrictions. Resident visa holders can also register a company, also subject to certain restrictions. If you want to be a Director of the company, then you have to apply for a Business Visa.

Choosing the type of company

Kabushiki Kaisha (KK): Limited liability company by share.
Godo Kaisha (GK): Used by small and medium sized companies and functions more like a partnership.

Differences between KK and GK

Cost for incorporation

Costs of incorporation for both Kabushiki Kaisha (KK) and Godo Kaisha (GK) types of company are as below:

As mentioned above, the process of incorporation should be relatively simple. However, when a foreigner is considering setting-up and running a business in Japan, they might have difficulties for the reasons below:

Language: All the documentation has to be prepared in Japanese. English versions of instructions are not always available. The staff in government offices also often cannot speak English or other foreign languages.
Choosing the most suitable type of company: Even if you understand the different types of the company and the basic Japanese incorporation rules, choosing the best type of company for your needs, when considering tax efficiency, running costs and other factors, can be difficult.
Tax return: All companies are obligated to file a tax return in Japan every year. Japanese tax rules are very complicated.
Government subsidy: The Japanese Government provides various types of subsidies for companies. However, applications are normally very complicated and the conditions of eligibility often change and it is difficult to know what the latest information is.

In addition to the above, you may face difficulties with other issues, such as opening a corporate bank account, hiring staff and staff HR management.

Should you require further clarifications or assistance, please do not hesitate to contact us. Our bilingual manager, who is a qualified CPA and Tax Expert, is happy to provide a free first consultation.