Opening a company in Japan: locals, foreigners, freelancers and digital nomads

At a glance: GK or KK from JPY 1 capital, Legal Affairs Bureau registration in one to two weeks, registration tax from JPY 60,000 (GK) or 150,000 (KK), effective corporate tax about 31 to 35 percent, 10 percent consumption tax from JPY 10 million turnover, Business Manager visa from JPY 30 million, six-month digital nomad visa on JPY 10 million income. Legal forms. Sole proprietor (kojin jigyo): free notification to the tax office, no capital. Godo Kaisha (GK, LLC-type): no minimum capital, members manage directly, cheapest to run. Kabushiki Kaisha (KK, joint-stock company): also from JPY 1, at least one director, notarised articles, better standing with banks and immigration. Founders typically put in JPY 1 to 5 million (about 6,000 to 29,000 euros). Registration. KK articles are notarised (JPY 30,000 to 50,000; none for a GK), capital is paid into a founder's personal bank account in Japan, then the Legal Affairs Bureau (Homukyoku) registers: registration tax 0.7 percent of capital, minimum JPY 150,000 for a KK and 60,000 for a GK. One to two weeks, then tax, labour and social insurance notifications. Judicial scriveners (shiho shoshi) charge JPY 100,000 to 250,000; total excluding capital about JPY 250,000 to 500,000 for a KK (1,450 to 2,900 euros). Taxes 2026. National corporate tax 23.2 percent, 15 percent on the first JPY 8 million for companies with capital up to JPY 100 million. With local corporate tax, enterprise tax, inhabitant tax and the new 4 percent defence surtax the Tokyo effective rate is about 31.5 percent for large companies, 34 to 35 for small companies above JPY 8 million and roughly 22 to 23 below. Dividends: 20.42 percent withholding on unlisted shares before treaty cuts. Consumption tax 10 percent; a company with capital under JPY 10 million (about 58,000 euros) is exempt for its first two fiscal years and while base-period sales stay under JPY 10 million. Personal income tax 5 to 45 percent plus 2.1 percent surtax and 10 percent inhabitant tax, about 55.9 combined above JPY 40 million. Freelancers and the self-employed. File the business commencement notification (kaigyo todoke) within one month and the blue-return election (aoiro shinkoku, deduction up to JPY 650,000) within two; no fee. Progressive income tax on actual profit, no flat regime; consumption tax exempt below JPY 10 million turnover. National Health Insurance about 10 percent of income plus National Pension JPY 17,920 a month in fiscal 2026: a low-income Tokyo freelancer pays roughly JPY 25,000 to 40,000 a month (150 to 235 euros). Foreigners. 100 percent foreign ownership, with prior notification under the Foreign Exchange Act in sensitive sectors; no resident director rule since 2015, but a Japanese registered office and in practice a resident person for the bank accounts. The Business Manager (keiei kanri) status is the founder visa: since 16 October 2025 it needs JPY 30 million (about 175,000 euros) in capital or investment, one full-time employee, three years of management experience or a management degree, Japanese at about B2 level for the applicant or an employee, a physical office and an expert-checked business plan; granted for four months to five years. Megabanks rarely open accounts for new companies without a resident representative. Branch of a foreign company. A branch (shiten) is registered at the Legal Affairs Bureau with the parent's notarised affidavit on incorporation, registration tax JPY 90,000, and at least one representative domiciled in Japan. Taxed as a permanent establishment on Japan-sourced income at the same effective rate, no branch remittance tax. A representative office needs no registration but may not trade; a KK or GK subsidiary is the usual choice. Digital nomads. Yes: the Digital Nomad status of residence (designated activities) since 1 April 2024, for nationals of 49 visa-exempt treaty countries, annual income of at least JPY 10 million (about 58,000 euros) from non-Japanese clients or employers, private health insurance, six months with no extension; spouse and children may accompany; no Japanese tax on the foreign income. Otherwise 90 days visa-free without work for Japanese clients. Changed recently. Digital Nomad status (April 2024); Freelance Protection Act (November 2024); the 1.03 million yen wall moved to JPY 1.6 million (2025); Business Manager visa capital raised from JPY 5 million to 30 million with employee, experience and language tests (October 2025); 4 percent defence surtax (April 2026); National Pension JPY 17,920 (April 2026). Figures checked October 2026 from the Legal Affairs Bureaus, the National Tax Agency, the Immigration Services Agency, the Japan Pension Service, PwC Worldwide Tax Summaries and Japanese law firms; thresholds and fees change yearly. Confirm with a licensed adviser in Japan before you file.