Setting up a company in Japan: A detailed guide (2025)

With a transparent business environment, developed infrastructure and strict legal system, Japan has become an ideal destination for foreign entrepreneurs and investors looking to expand their business operations.

However, establishing a company in Japan requires compliance with strict legal and regulatory procedures that many investors can easily overlook if they are not well prepared.

Therefore, the following article of GLA will provide details on the requirements, procedures for establishing a company and regulations to comply with after establishment in Japan, helping businesses to easily register to open a company with support from GLA.

1. Requirements for opening a company in Japan

Before starting the process of establishing a company in Japan, businesses need to clearly understand the following basic legal requirements:

1.1. Residence and nationality

Japan allows foreigners to set up companies without having Japanese nationality. 

However, the company must have at least one director residing in Japan (Not a mandatory requirement but this is a great benefit for the company). GLA will support the Company to hire a Japanese designated director if the company has a need. The designated director is only responsible for meeting the requirements for opening a company, they do not have any role or decision-making power in the business operations.

1.2. Shareholders and directors

Each company must have at least one director and one shareholder, Japan allows foreign investors to own 100% of the company's shares. Shareholders can be company directors if they have the appropriate certificates.

1.3. Minimum capital

Japan does not stipulate a minimum capital requirement for establishing a company. However, to facilitate the registration and operation process, the charter capital should be at least 5 million yen (about 46.000 USD).

Especially if the business is applying for a business visa in Japan, this requirement needs to be carried out accurately and quickly.

1.4. Company address

A business must have an official office address in Japan to register a company. This address can be a physical office or a legal, verifiable company address to open a company and receive correspondence from government agencies and important parties.

Documents required to open a company in Japan

For foreign individuals

Foreign individuals must ensure that they meet the following 3 requirements:

• Certificate of Seal (Inkan shomeisho).

Certificate must be issued within 3 months Investors wishing to become directors must have 2 copies of the certificate.

The certificate may be replaced by a certified copy of the signature issued by the Embassy/Consulate of the country in Japan or a Notary Public. In addition, the company seal will be registered at the Registration Office. 

• Signature 

All incorporation papers and other documents must bear the signature or seal of the investors.

• Personal Account and Savings Book (Tsucho)

A corporate shareholder should present a personal account in Japan or an existing account proving the capital required to open the company.

For foreign companies 

Foreign companies, in addition to individuals who are company shareholders and meet the three requirements mentioned above, need to prepare the following additional documents:

• Certificate of parent company opening issued within 3 months (original or notarized copy).
• Notarized signature of company representative. 
• Certificate of Seal (Inkan shomeisho).
• Signature or seal of investors on all important documents.
• Personal account and savings book (Tsucho) certify the charter capital to be contributed to the company.

2. Procedures for establishing a company in Japan

After the Enterprise has prepared all documents and papers, GLA will support individuals/enterprises to register to establish a company in Japan to optimize costs, comply with the law and operate after establishment with the following 5-step process:

3. Compliance after company establishment

After establishing a company, a Japanese company will need to comply with the following to ensure stable and legal business operations.

Submit annual financial statements

Companies in Japan are required to submit annual financial reports to the tax authorities. These reports include balance sheets, income statements, and other documents.

Companies must hire auditors to conduct audits if they meet certain size standards.

Pay corporate income tax

Depending on the revenue and size, the company will have to pay annual corporate income tax to the local and central government. Tax rates range from 23-30%, depending on the type of business and profits.

Consumption Tax Registration

If a company's revenue exceeds 10 million yen in the previous fiscal year, a company in Japan is required to register and pay consumption tax (equivalent to VAT) at the current rate of 10%.

Comply with labor and social insurance laws

If the company has employees, the Enterprise needs to register and contribute to social insurance (shakai hoken), health insurance, and unemployment insurance for employees.

In addition, it is necessary to comply with regulations on labor rights, wages and working hours according to Japanese law.

Report and update company information

Any changes relating to directors, shareholders, or company address must be notified to the regulatory authority within 14 days of the change.

4. How does GLA support businesses to open companies in Japan?

Global Links Asia, with experience in consulting and supporting the establishment of a company in Japan, will support businesses in:

• Consulting on suitable company types, helping businesses optimize business operations in Japan.
• Support companies in Japan to comply with laws and annual requirements legally, accurately and effectively.
• Tax, accounting and financial reporting services according to Japanese standards with optimal cost, accuracy and compliance with the law.
• Register to open and authenticate a bank account with a physical bank in Japan or open an account with a licensed digital bank in Singapore, the US, or Hong Kong.

5. Frequently asked questions about the process of opening a company in Japan

Highlights

• Businesses need to ensure that the company has legal charter capital, shareholders and directors, registered company seal, and has a legal office address in Japan to successfully register.
• Foreigners can register a company in Japan with a minimum capital of 1 yen. However, if the business owner wants to apply for a business visa, the minimum capital should be 5 million yen (~US$46.000) to meet financial and business requirements.
• Foreign individuals and companies must ensure they have a savings account number, seal certificate, appropriate company documents and legal signatures on all documents to register to open a company.
• Companies must submit financial reports, declare and pay taxes annually, and comply with labor and social insurance regulations.