FAQ, 10 Tips for Company Formation in Japan

Here are some of the most common questionsIget asked by clients who come to my office for advice on how to start a business.

Q1. I want to establish a Godo-Kaisya (LLC).

A1. Many of my clients choose a Godo-Kaisya (LLC) from the start because of the many advantages of a Godo-Kaisya, such as lower initial costs, shorter establishment time, faster decision-making because the investors and management are the same, and the ability to freely decide on profit sharing. However, there are some disadvantages, so I try to ask my clients to make a final decision after consultation with me.

Q2. How much capital should I start with?

A2. Currently in Japan, by law, a company can be established with a minimum capital of one yen. Please prepare the capital necessary for the size of the business and the operation of the company. Even if the company is in the red, the corporate inhabitant tax is at least about 70,000 JPY a year. There is also a registration fee for the establishment of the company. The tax rate can also increase based on a capital of 10 million yen to 100 million yen.

There may be also capital restrictions if you are looking to obtain a management and administration visa.

Q3. Can we use a virtual office for the head office?

A3. If the company running the virtual office is in a location where it can be registered, it can be registered, however, if you would like to create a corporate account, it would be difficult to create without an entity.

Q4. Business purposes

A4. (1) There are certain purposes for which permits and approvals are required after the establishment of the company, and they would need to be acquired.

I can introduce administrative scriveners who are members of One-stop Business Startup Kawasaki and they work with you to obtain the license and approval on your behalf.

(2) Prior notification under the Foreign Exchange Act may be required.
Depending on the purpose of your business, your business may fall under the category of an industry that needs to be notified in advance by the Foreign Exchange Law, in which case we will assist you in notifying the competent authorities through the Bank of Japan prior to registration of your business.

Q5. Do the directors have to be domiciled in Japan?

A5. A Godo Kaisha (LLC) or a Kabushiki Kaisha (joint stock company) can be established even if the directors don’t have domicile in Japan.

Q6. How to invest in the company?

A6. Basically, you need to invest in your personal account, and open a corporate account after the company is established.

Q7. What is the minimum number of directors?

A7. A Godo-kaisha or a Kabushiki-kaisha basically requires at least one person.

A Kabushiki-kaisha, if it has a board of directors, requires three directors and one auditor, however, if it does not settle a board of directors, it can be established with only one director.

Q8. When should the fiscal year be?

A8. There is no statutory starting month for a fiscal year, so you can start your fiscal year at any time.

Privately held companies usually have one fiscal year as their fiscal year.

You have to take inventory to close the accounts, so you can set it at a time when your inventory is low. Please contact us because each company has a different situation.

Q9. I’d like you to make a seal for me.

A9. I can order a reasonable corporate stamp for your company on your behalf. Please contact us for more information.

Q10. How long does it take to set up a company?

A10. It takes normally about a week to 10 days to complete the registration after you sign your articles of incorporation and other documents. After the registration, we will obtain a certified copy of the company’s corporate seal and a corporate seal certificate.

Basic Flow

Document preparation/sealing → capital contribution → (Articles of Incorporation authentication only Kabushiki-kaisha) → Company representative’s seal made → application for registration → registration completed

Another challenge for foreigners to start a business in Japan | Opening A Business Bank Account

For foreigners who want to start a business in Japan, there are many things that they have to do, such as finding an office, registering a company, and applying for a visa.
However, there are many specialists in Japan who can speak English, and we provide consultation and actual support. We at Onestop Kawasaki are a unique group of such specialists.

Today, let’s talk about another barrier you face when you set up a company, get a visa, get the business license you need, to start your business.

That is, “I can’t open a bank account in the name of a corporation.”
Japanese banks can easily open an account for individual account even if they are foreigners if they have a status of residence, but the hurdle is greatly raised when it comes to “corporate name”.
The reason is that in the case of a corporation, the transaction amount is also large, so “credibility” is judged more strictly. This is the same when a Japanese person starts a business individually.

On the other hand, Japan is said by the United Nations to be a country with loose restrictions on money laundering. The Financial Services Agency and other Japanese government agencies are closely monitoring the opening of bank accounts in the name of foreigners, which can be a hotbed for money laundering. Japanese used car export business is said to be the target. It seems that there have been malicious cases in the past. If you are planning a business to buy used cars in Japan and sell them overseas, you should be careful.

There are many documents required for this, and it takes time and effort to prepare financial plans and proof of assets currently owned by tax accountants and certified public accountants.
And the most confusing thing is that the criteria for opening an account have not been clarified openly.

In my experience, when I asked the bank why it was refused to open a new corporate account for a Pakistani entrepreneur, there was no further explanation saying, “I made a comprehensive decision.”
Eventually, the president gave up and decided to start the trading in his personal bank account. About a year later, the opening of a corporate account was finally approved due to the success of the individual transaction record and the appeal of the person’s enthusiastic attitude.

Talking about another case, when a foreigner started a business with the support from JETRO (Japan External Trade Organization), the person could easily open a corporate account with a support letter from JETRO. However, in order to receive JETRO support, it seems that the foreign headquarters must be of a certain size or the investment amount must be of a certain size.

When formulating a business plan, you may have to assume that there are such facts.

For more details, please contact

“Blue return” Please do not forget this.

Today, I would like to talk about the blue return system in Japan.
If corporate taxpayer is approved as blue return tax payer by the tax office you can get various privileges.

– You can carryforwards the loss in the fiscal year to each 9years.
– You can refund corporate tax of last year by carrying back loss
– Tax office is prohibited to correct tax by estimation method.
– You can do lump-sum depreciation for depreciable assets less than 300,000yen.

The purpose of this system is to spread the self-assessment system of tax return and to promote proper bookkeeping. You must obtain approval before you can file a blue return. The procedure is simple, you just have to submit the application to the tax office with no fee.

Blue return procedure

Before you can be filed as a blue tax return, you need to get approval from the tax office. The flow is as follows.

(1) Filling in the required items on the blue return application form.
(2) Bring, it by mail, or submitting by E-Tax to the tax office.

You can download the blue tax return application form from the National Tax Agency website.

The deadline for submitting the application is the day three months after the establishment date.

If you do not file in blue, it will be white return. If you do not file in blue, or if you want to file in blue but miss the application deadline, you must file in “white”. White tax return is also one of the tax filing methods. You can do the accounting work easier than blue tax return. You can do the bookkeeping by “single-entry ” if you are white return.

The white return is easy way but you may lost the various benefits available for blue return.

So you should get blue return!

When you show medical insurance card and receive treatment (保険証を提示して治療を受けるとき)

When you got sick or injured (payment of medical treatment)

When an insured person or a dependent in a health insurance is ill or injured due to an out-of-service reason, a health insurance card (hospital, medical office) should have a health insurance card (if you are 70 years old or older, match an elderly beneficiary card) You can receive medical treatment, such as medical examination, treatment, medication, by filing and paying a part of the contribution. In addition, if you receive a doctor’s prescription, you can have the medicine dispensed at the insurance pharmacy. (This is called “medical treatment benefit.”)


Range of medical treatment benefits

Doctor’s examination and Inspection:
 If you have a physical problem, you can always take the exams you need for a doctor’s or medical treatment with your health insurance.
Medicine and therapeutic material:
 The medicines necessary for treatment are provided only to those listed at the standard price of the medicine covered by medical insurance.
Treatment and surgery:
 You can receive radiation therapy and medical treatment instruction as well as injection, treatment and surgery.
Hospitalization and nursing:
 For meals and daily life recuperation during hospitalization, a fixed amount will be paid per meal and per day. When you want a special room (such as a private room), it is necessary to bear the difference of the room charge.
Home care and visiting care:
 You can receive home care from a doctor so that you can feel safe and at home. In addition, visiting care can be received by nurses dispatched from a visiting nursing station.
Overseas medical expenses :
 See this website.


About medical treatment that can not be received by health insurance

The medical treatment benefits for health insurance cover the treatment of people who are ill or injured. For this reason, health insurance can not be used for medical treatment (such as cosmetic surgery) received without any problem in daily life. Since pregnancy is not considered a disease, normal pregnancy and delivery are excluded from health insurance coverage. In addition, the benefits may be limited if you have a disease or injury that deviates from the purpose of health insurance.


Cases where health insurance cannot be used

  • Plastic surgery for cosmetic purposes
  • Myopic surgery etc
  • Advanced medicine under study
  • Preventive injection
  • Medical check up, Comprehensive medical examination
  • Normal pregnancy and childbirth
  • Abortion due to economic reasons
  • 美容を目的とする整形手術 
  • 近視の手術など
  • 研究中の先進医療
  • 予防注射
  • 健康診断、人間ドック
  • 正常な妊娠・出産
  • 経済的理由による人工妊娠中絶

Exception cases where health insurance can be used

  • If you have trouble with labor due to strabismus etc., you have surgery for birth clefts, plastic surgery for treatment of injuries, surgery for wakiga which causes significant discomfort to others etc..
  • When receiving medical treatment prescribed by the Minister of Health, Labor and Welfare at a university hospital etc.
  • In the case of abnormal delivery due to pregnancy hypertension syndrome (pregnancy toxemia)
  • Artificial abortion to protect the mother when the mother is at risk
  • 斜視等で労務に支障をきたす場合、生まれつきの口唇裂の手術、ケガの処置のための整形手術、他人に著しい不快感を与えるワキガの手術など 
  • 大学病院などで厚生労働大臣の定める診療を受ける場合  
  • 妊娠高血圧症候群(妊娠中毒症)などによる異常分娩の場合
  • 母体に危険が迫った場合に母体を保護するための人工妊娠中絶

Injuries caused by work or commuting disasters?

Health insurance is not provided for illnesses or injuries caused by work-related or injuries incurred while commuting to work. In principle, workers’ compensation insurance is applied.


Cases where health insurance benefits are limited

About illness or injury in the following cases, you may not be able to receive benefit or may be limited in some cases as it interferes with healthy administration of health insurance system.

  • When a criminal act or intentional accident (illness, injury, death, etc.) occurred
  • When you get sick or injured due to a fight or drunk alcohol
  • When you did not follow the doctor’s (hospital) instructions without justifiable reasons
  • When receiving or trying to receive insurance benefits for swindle or other fraud
  • When you refuse questions or diagnoses instructed by the insurer
  • When you are in a juvenile training school or a penal institution (It is not possible to provide health insurance benefits, however, burial fees and payments to dependents will be provided)


  • 犯罪行為や故意に事故(病気・ケガ・死亡など)を起こしたとき
  • ケンカ、酒酔いなどで病気やケガをしたとき
  • 正当な理由もないのに医師(病院)の指示に従わなかったとき
  • 詐欺、その他不正に保険給付を受けたり、受けようとしたとき
  • 保険者の指示する質問や診断を拒んだとき
  • 少年院や刑事施設などにいるとき(健康保険給付を行うことが事実上不可能なため、支給されません。ただし、埋葬料と被扶養者への支給は行われます)

VISA required to start a business in Japan

This time, I will talk about VISA, which is necessary when starting a business in Japan.

Japanese visas can be roughly divided into two categories. One is Activity-Type VISA given by activities conducted in Japan, and the other one is Status-Type vise given by status or position in Japan.
(Please refer to the [Visas in Japan and work] table below.)

There are four kind of Status-Type vise: “Permanent Resident”, “Spouse or Child of Japanese National”, “Spouse or Child of Permanent Resident”, and “Long-Term Resident”.
There are no work restrictions for Status-Type vise. Any job is possible if it is not illegal.
When starting a business in Japan, there are no requirements for obtaining VISA, so you can set up a company as freely as a Japanese.

If you do not have one of Status-Type vises above, you must obtain a “Business Manager” VISA to manage or engage in business activities in Japan. (Please refer to the [Business Manager description]  below.)

Some people reading this blog may be thinking of starting a business by acquiring Highly Skilled Professionals VISA which has various types of Preferential Treatment.
This VISA can also manage the business, however, to obtain the VISA.
Firstly, it is necessary to meet the requirements of the “Business Manager” VISA.
In addition, it is necessary to secure income of 3 million yen or more, which is a requirement of “Highly Skilled Professionals” and obtain 70 points or more with the point system for “Highly Skilled Professionals”.

Below are the main requirements for obtaining” Business Manager “VISA.

(1) The business scale of the company satisfies either a) or b) or the combination of a) and b).

a) Business scale of 5 million yen or more
(In many cases, proof of the scale of the business is proved by the amount of capital of the company.)
b) Hiring two or more full-time employee.
(The above-mentioned full-time employees should be Japanese or ” those who holding Status-Type Visa Such as “permanent residents”, “spouses or child of Japanese”,” spouses or child of permanent resident”, “Long-term residents).

(2) An independent office (business facility) is secured for business in Japan.

(3) It is necessary to submit a feasible business plan.

To obtain the VISA, it is required to establish a company to meet the above requirements.

In addition, depending on the content of the business, there are some businesses that require prior permission from the relevant ministry or agency to carry out the business, as required by law.
In that case, it is necessary to establish a company that meets the requirements for permission.
Please be careful when deciding on the facility of business and creating the company’s articles of incorporation.

【Business Manager description】


Authorized activities


Period of Stay

Business Manager

Activities to engage in the operation of international trade or other business in Japan or to manage said business (except for activities to engage in the operation or management of business which may not be legally conducted without the qualification given in the column of “Legal/Accounting Services”).

Manager or operator of a company, etc.

5 years, 3 years, 1 year, 4 months or 3 months

The above “Business Manager description” is a quote from 2019 Immigration Control and Residency Management, (created by Immigration Services Agency, Japan).

Setting Up Your Company from Home

~Start Your Online Application from March 17, 2020~

Due to the impact of the coronavirus, people are being discouraged from going outside unless the situation is urgent. In other words, people are expected to practice social distancing in Japan.

This is good news for those who want to start a business in Japan. Per the decision of the Future Investment Strategy 2018 in accordance with the policy of the Japanese government, from March 17, 2020, the registration to incorporate a company can now be completed within 24 hours upon receipt of your online application.

If the following conditions apply to you, this way is the fastest way to set up a company from the comfort of your own home.

Companies which meet the following conditions are applicable:

Kabushiki-Kaisha (Stock company) or Good-Kaisha (LLC) 
No more than 5 officers (members)
At the time of online application, the application and the attached PDF documents must be transmitted online (with the electronic signature of the founder)
Registration license tax paid electronically
No missing application forms and attachments, all legal requirements met, and no spelling errors, etc.

What are some of the challenges?

・ All online applications must be done in Japanese.
・ Digital signatures are required for all application documents.
・ In Japan, one must report the seal of a corporation, which must be mailed or brought in writing. Registration will not be completed unless the seal notification is sent to the registry office, and even registration will not necessarily be completed within 24 hours of application.
・ If in rushing to complete the process a mistake is made, the registration would need to be done all over again.
・ Although foreigners who do not have an address in Japan can register as a corporation, it is necessary to prepare the necessary documents in their home country or Japan in advance. The handling procedures differ depending on the country

If you do not meet the above conditions, you can still incorporate yourself.

However, you need to choose the correct and up-to-date information suited to your individual situation.

We, Kawasaki One-stop Business Startup Center, can support you online.

We will create the documents for your company’s incorporation in accordance with the laws and regulations, provide advice, register the establishment of the company, and obtain a certified copy of the registration. In addition, we can also provide services such as tax reporting, labor procedures, visa support, business planning, legal advice by qualified attorneys as well as full support to guide you through the necessary procedures after incorporation. Leave it to our experts.

I look forward to receiving your inquiry.

The walls to start a business in Japan

The 2020 Tokyo Olympics is coming soon, and there are increasing inquiries from foreigners who want to start a businesses in Japan, such as expanding sales channels for products in Japan, or importing Japanese products, etc. Both the central and local governments of Japan have begun policies such as special economic zones to support such trend. However, Japan is an island nation, and for 400 years from beginning of 17th century, Japan closed its country by restricting exchanges with foreign countries. As a result, there are many differences in the business environment. For many foreigners, it could be considered as a “wall”.
I would like to introduce such differences in Japanese business culture.

Wall 1 Government

The Japanese government has been active in accepting foreigners, but officials on the ground have not yet reached that level. Many are basically conservative, as inherited from the Meiji era. To start a business in Japan, you have to obtain permission or registration from various government offices. In order to start a business, such as the Legal Affairs Bureau of company registration, the Working visa to Immigration Service, and the used car business, you must submit a lot of documents to the police station to acquire secondhand dealer license and a tax office to import and sell liquor. Permission to start a business will not hurt you for being a foreigner, but explanations may be rough or inadequate some time.

Wall 2 Language

Unfortunately, you must submit your paper or electronically to get those permits. However, most of the documents are in Japanese. The only part that is accepted in English may be the visa application. Even the guidelines for obtaining permission are all in Japanese except for some visa-related items. Without support for those who can speak Japanese, there will be a lot of struggle to get permission. In order to obtain a business license, it is often necessary to determine the person in charge and take a seminar hosted by the government office, but most of the such seminars are limited to Japanese only. In the case of foreigners who cannot speak Japanese, there is no choice but to appoint or accompany someone who can speak Japanese.

Wall 3 Banking

In recent years, it has become increasingly difficult for foreign-invested companies to open corporate accounts in some industries, as Japanese financial authorities have put forward a policy to strengthen anti-money laundering measures.
Also, financing for foreigners is not very active, and financing for people other than those with permanent resident status or a Japanese spouse is not easy at present.

Wall 4 Business habits

The decision-making process of Japanese companies is very different from that of Western, Asian and other companies. It is often said that decision-making is slow, many business meetings, but no progress at all, have to exchange business cards with many people, but do not know who has the authority to decide. . . and so on.
A story about a Japanese company and a company in Zhejiang Province, China, said that the managers level agreed to launch a joint venture, and after that, the Japanese company delegates visited China many times, including the top management from Japan. In each case, the Chinese side responded in anticipation of when to give the go-ahead, but the Japanese side could not decide and ended up being neglected. Thus, negotiations with the Japanese also require patience.
They can all be described as one common character, a culture where responsibility is shared by as many people as possible. However, the Japanese have the habit of once they decide, they always do it.

To overcome these barriers, Onestop Kawasaki can support foreign entrepreneurs by using expertise of each member.