More and more foundation of business is getting popular these days in Japan.
There are many advantages in incorporation such as business flexibility, tax savings and so on.
But you have to go through plenty of procedures.
In this page, you will figure out how to start your own business in Japan.
1. Verification of Articles of Incorporation（定款）
You compile the Articles of Incorporation in which the basic information is written.
Then, you take the Articles of Incorporation to the Notary Office（公証役場）and have it verified.
This procedure is designed to make sure that the Articles of Incorporation is prepared properly.
It costs 40,000 JPY for revenue stamp（収入印紙）while it is free of charge in the case you submit it by an electronic version.
2. Setting up evidence of funding for Capital amount
As a company bank account hasn’t been opened yet at this point, an appointed representative director’s bank account is used to deposit the capital amount in.
Copies of the following parts of the passbook are needed to prove that the capital amount is funded.
- Cover page
- Back cover page
- page on which the details of funding the capital amount is written
3. Application for company registration（設立登記）
File your company’s registration application at the Registry Office（法務局）within 2 weeks after capital amount funding. Registration fees generally cost 150,000 JPY.
Once registration is completed, you get a registry certificate and your company seal certificate, which is required to open a company bank account.
This process generally takes approximately 4 weeks to complete.
4. Document submission to the Tax office（税務署）
Following documents submission to the Tax Office is required after company registration.
- Notification of incorporation of a Company
→This document is required to be submitted within 2 months after incorporation to announce your firm’s establishment.
- Application for Blue Form Return
→This document is required to be submitted within 3 months after incorporation to enjoy several benefits on Japanese taxation.
- Notification of Establishment of an Office, Etc.Paying Salaries
→This document is required to be submitted within 1 month after establishment to announce that your firm is a salary paying firm.
- Application for Approval Made in Relation to the Special Provision for Due Dates for Withholding Income Tax
→In principle, you need to pay a withholding tax every month. But you can make payments of this tax twice a year if you submit this document by the end of the previous month for application.
- Application for valuation method of inventories
→In principle, you need to appraise the value of inventories by means of a fixed method at the end of the fiscal year. But you can select the method if you submit this document by the deadline for the final tax return.
- Application for depreciation method of depreciable fixed assets
→In principle, you need to depreciate fixed assets on a designated method. But you can select a method of depreciation if you submit this document by the deadline for final tax return.
The following document is required to be submitted to the Local tax office
- Notification of incorporation of a Company
→This document is required to be submitted within 15 days after establishment to announce your firm’s establishment.
Applying for social insurance, in principle, is mandatory when you set up an entity.
Social insurance consists of health insurance（健康保険）and welfare pension（厚生年金）. Application forms below are required to be submitted to Japan Pension Service（日本年金機構）.
- 健康保険・厚生年金保険 新規適用届
Notification of the foundation of your business. Must be submitted with Certificate of Registry（登記簿謄本）within 5 days after business opening.
Notification of salaries for each directors/employees to determine the amount of monthly payment for insurance and pension. Must be submitted within 5 days after hiring an employee.
6. Application for labor insurance（労働保険）
Unlike social insurance, the application of which must be submitted even in the case where there are only directors in the firm, labor insurance is not applicable if you don’t hire employees.
Submission of the below documents are required when you hire employees;
【to the Labor Standards Inspection Office（労働基準監督署）】
【to Public Employment Security Office（公共職業安定所】
Iwasawa Tokyo Accounting is committed to helping those who engage in their business in Japan mainly in accounting & tax point of view. If you plan to set up a business in Tokyo, we are always happy to help you!