Procedure and Costs to Start Small Business in Japan

costs to start small business in japan

This comprehensive guide will explain the detailed procedure and costs to start a small business in Japan.

If you missed the beginner guide to starting a business in Japan, we encouraged you to read it before jumping into these comprehensive guidelines.




Procedure and Costs to Start Small Business in Japan


Step 1: Required Documents and the Details to Decide in the Articles of Incorporation

At first, you must find the office address to start the business. You must decide the essential elements and prepare the required documents for the business.

Required documents for a foreign individual

  • Seal certificate (Inkan shomeisho) (issued within three months) of each investor and director.
  • Each investor and director’s signature (or seal) is required on the Articles of Incorporation and other documents needed.
  • One of the investor’s bank account and its passbook (tsucho) / bank statement for the deposit of capital. Company seal that needs to be registered at the registry office.
  • Company seal that needs to be registered at the registry office.

Details to Be Decided in the Articles of Incorporation

  • Company Name

The company name can be in the alphabet, numbers, kanji, hiragana, or katakana (or a mixture of these).

  • Company Address

The company address will be shown on the registry certificate (which anyone can get), so some companies prefer to choose an address to give a good image (Ginza, Aoyama, Akasaka, etc.).

  • Company’s Activities

It is possible to list as many activities as you wish to do, including those that will not be performed immediately.

  • Administration

A company needs to appoint at least one director. An investor/shareholder can become a director at the same time.

  • Corporate Capital

Even if it is technically possible to establish a company with 1 yen, it is wise to fix a capital that would allow you to pay the initial expenses or gain credibility according to the nature of your business.

  • Fiscal Year

A company is free to decide its fiscal year that needs to be fixed in the Articles of Incorporation.



Step 2: Preparing the Articles of Incorporation (teikan)

Articles of incorporation are all about how your company will be managed. This step should be describing the needs of shareholders or investors and their relationship with the corresponding directors.

Step 3: Notarization of the Articles of Incorporation

Notarization is done at the Notary Office / Koshonin yakuba.  It is only needed for Kabushiki Kaisha (KK) but not required for Godo Kaisha (GK).

Notarization fee: 50,000 yen Revenue stamps (also required for GK): 40,000 yen

Step 4: Deposit of Capital

After the completion of registration, you can open the company’s bank account. You should use one of the investor’s bank account in Japan to deposit initial capital.

Step 5: Preparing Documents for Company’s Registration

Besides the application form, you should prepare various documents like a notification of the company’s seal (Inka) registration and a letter of agreement from the directors.

Step 6: Application Filling For Company Registration

It can be done at Registry Office / Homukyoku.

The minimum registration fee for KK is 150,000 yen and 60,000 yen for GK.

Step 7: Obtaining the Registry Certificate and Company’s Seal

After the completion of registration, you must obtain the registration certificate and the company’s seal certificate. These are necessary while opening a corporate bank account or signing business or other employment contracts in the company’s name.

Step 8: Tax and Social Insurance Related Procedures

These include opening a bank account under the company’s name, application of visa and status for a status of residence for staff, and application of business license if required.

To sum up, if you are trying to set up Kabushiki Kaisha (KK), the estimated setting up costs is around 500,000 yen. For Godo Kaisha (GK), you can start up with approximately 300,000 yen per the market evaluation of 2018.

Note that these all procedures as mentioned above can be done within two to four weeks periods.

We hope, at least, you have set up somewhat of mind for the procedures and costs to establish a business in Japan.

If you need more information and consultants, you can find many advisory and consultancy companies in Japan that can help you establish a business in Japan. They might have years of experience in this field.

Especially if you are trying to invest more, we suggest you find some advisory and consultancy companies for help.

Disclaimer:

We are not related to any advisory and consulting companies. All the information herein is published in good faith and for general information purpose only and not for providing legal advice. You should contact your attorney to obtain advice for any issue or problem.




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