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How Much Does It Cost to Set Up a Company in Japan?

· Masayuki Tani

The answer

The registration tax starts at JPY 60,000 for a godo kaisha (合同会社, GK) and JPY 150,000 for a kabushiki kaisha (株式会社, KK), and a KK also pays a notary at least JPY 15,000 plus a small charge for copies. If the articles of incorporation are made on paper, JPY 40,000 of stamp duty is added. Professional fees and any documents you need from abroad come on top. The capital is not among these costs, because it stays with the company as its money.

Registration tax

The registration tax on formation is 0.7% of the capital, with a minimum of JPY 60,000 for a GK and JPY 150,000 for a KK. The minimum applies until the capital reaches about JPY 8.57 million for a GK and about JPY 21.4 million for a KK.

The notary's fee (KK only)

A KK's articles of incorporation, which the founders draw up to form the KK, take effect only once a notary certifies them (Companies Act, 会社法 Kaisha-hō, Arts. 26(1) and 30(1)). A GK's articles are drawn up and signed by its members under a separate provision (Art. 575(1)). The notary's fee depends on the capital (Notary Fees Order, 公証人手数料令 Kōshōnin Tesūryō-rei, Art. 35):

  • JPY 15,000, if the capital is under JPY 1 million, the founders are no more than three individuals who take all the initial shares, and the company has no board of directors
  • JPY 30,000 otherwise, if the capital is under JPY 1 million
  • JPY 40,000, if the capital is at least JPY 1 million and under JPY 3 million
  • JPY 50,000, if the capital is JPY 3 million or more

The notary also charges JPY 250 a page for certified copies of the articles (Art. 40(2)). The Japan National Notaries Association puts this at about JPY 2,000 for a typical set of articles.

Stamp duty on paper articles

The original of the articles of incorporation, made on paper when a GK or KK is formed, carries stamp duty of JPY 40,000. For a KK, the Japan National Notaries Association says that this stamp is not needed when the articles are certified as an electronic (PDF) file.

Documents from abroad

A foreign national who signs the registration documents normally uses a signature certificate made by the authorities or a notary of their home country, as the Ministry of Justice explains on its page for foreign nationals and expatriates. As a general rule, documents in a foreign language are filed with a Japanese translation. The cost of the certificate is set in the home country.

Professional fees

A lawyer or a judicial scrivener can prepare the documents and file the registration for you. Our fixed fees are US$490 for a GK and US$790 for a KK without a board of directors, excluding tax, with the government fees above charged at cost.

After registration

The local corporate inhabitant tax includes a per-capita levy, based on the company's capital and number of employees rather than its profit. For a company with offices only in Tokyo's special wards, 50 or fewer employees and capital of up to JPY 10 million, it is JPY 70,000, according to JETRO's tax overview.

A KK must also publish its balance sheet each year, unless it files annual securities reports (Companies Act, Art. 440(1) and (4)). If its method of public notice is the Official Gazette or a newspaper, it can instead keep the balance sheet available online for five years (Art. 440(2) and (3)). A GK has no such duty, because Art. 440 applies only to a KK.

References

This article is for general information only and is not legal or tax advice.

For how the capital affects these figures, see how much capital you need. You can also see how our fixed-fee company incorporation works.

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