Starting a Business in Japan: The 2026 Guide for Foreign Entrepreneurs

Starting a business in Japan (起業, kigyō) as a foreigner follows the same core path for every foreign founder. You choose a business structure, confirm your visa route, and register with the Legal Affairs Bureau (法務局, Hōmukyoku).

You have five main structures: sole proprietorship, kabushiki kaisha (KK), godo kaisha (GK), branch office and representative office. Government fees for a KK run about ¥170,000 to ¥250,000. A GK costs about ¥60,000 to ¥100,000.

Company setup usually takes two to four weeks. Qualifying fully online filings register within 24 hours, and others take about three business days. A Business Manager visa adds one to three months for the Certificate of Eligibility.

Your residence status decides what you can do. Permanent residents, long-term residents and spouses of Japanese nationals or permanent residents can run their own business freely. Most other foreign nationals need a Business Manager visa or a Startup Visa.

Japan is the world's fourth-largest economy by nominal GDP, and the Japanese market rewards careful preparation. This guide covers each step, from your business plan to your first hire. For the filing itself, see our guide to company registration in Japan. For real examples, see how foreign brands entered Japan's market successfully.

Starting a business in Japan at a glance

Professional fees, seals and office costs come on top. See the real cost of starting a business in Japan for a full breakdown.

Step 1. Research your market sector

Many foreign companies set up a company in Japan and later pulled out. Most could not compete with Japanese companies that understand local buyers.

Sephora left in the early 2000s. In 2020, Walmart agreed to sell 85% of its Japanese supermarket chain, Seiyu.

Start by naming your direct competitors and how you will beat them. Success in other markets does not predict success in the Japanese market.

Then gather the numbers your business plan needs:

• How Japanese buyers behave (see Japanese attitudes toward consumption)

• Distributor, marketing and upfront operating costs

• The initial capital you need before revenue arrives

Much of this data exists only in Japanese, so a bilingual assistant can help. Our guide to market research in Japan explains the methods.

Step 2. Choose a company structure 

You have five main options for your business structure. The right one depends on whether you are a foreign company or a foreign individual expanding into Japan.

• Sole proprietorship (kojin jigyō). Residents can register a personal business at the local tax office for free. Many owners incorporate later as profits grow. See our guide to sole proprietorship in Japan.

• Branch office. A branch office extends a foreign company into Japan. It has no separate legal status, so the parent company carries its debts. You register it, appoint a representative in Japan and file an affidavit from the head office.

• Kabushiki kaisha (KK). A KK is a stock company. It can issue shares and pay dividends to foreign investors. It builds credibility when networking but carries more governance rules, such as shareholder meetings.

• Godo kaisha (GK). A GK is a limited liability company, introduced in 2006 and modeled on the American limited liability company. It has fewer formalities and lower fees than a KK. Members run the business directly, though the articles can appoint managing partners.

• Representative office. A representative office can research the market and advertise. It cannot sell, so it does not register.

👉 Compare the two company types in kabushiki kaisha vs. godo kaisha. For the filing steps, read our guide to company registration in Japan. For complex cases, consult one of these English-speaking corporate lawyers.

Which business structure should you choose when starting a business in Japan?

The right business structure depends on your visa pathway, how you will run daily business operations, and whether you are a foreign company entering the Japanese market or a foreign individual expanding into Japan to build your own company.

Below is a practical decision guide used by many foreign entrepreneurs when planning their business in Japan.

How this choice affects visas and registration

If you need a business visa, your business structure must support it. The Business Manager visa and the Startup Visa are the two main routes.

In practice, this means:

• Your company must complete business registration at the Legal Affairs Bureau.

• Your visa application is reviewed by the Immigration Services Agency of Japan (immigration bureau).

• You must present a detailed business plan and evidence of real office space. A virtual office works for company registration, but immigration expects a physical base for a Business Manager visa.

For Startup Visa applicants in particular, eligibility is assessed in cooperation with the Japanese government and participating local authorities. Approval is coordinated through the relevant local government office before submission to immigration.

Step 3. Check your residence status and get the right business visa

Your residence status decides whether you can run a business in Japan. The Immigration Services Agency of Japan manages every status of residence.

Who can run a business without a business visa

Some foreign nationals can manage their own company on their current status:

• Permanent residents

• Long-term residents

• Spouses or children of Japanese nationals

• Spouses or children of permanent residents

Work visas are different. An engineer or specialist visa lets you set up a company, but not manage it.

Business visa options for foreign entrepreneurs

Most applicants first get a Certificate of Eligibility. It usually takes one to three months.

• Business Manager visa. Since October 16, 2025, you must meet all of these rules:

  • ¥30 million in capital

  • At least one full-time employee who is a Japanese national, permanent resident or spouse visa holder

  • 3+ years' management experience, or a relevant master's or doctoral degree

  • Japanese at CEFR B2, for you or your full-time employee

  • A complete business plan checked by a qualified expert, such as a certified accountant

  • A physical business base in Japan

• Four-Month Business Manager visa. This short status gives you 4 months to finish setup. Use it to open a Japanese personal bank account and gather all the documents. The immigration bureau reviews your draft articles of incorporation, capital and officers.

• Startup Visa. This program lets you stay up to two years while you prepare. You do not need to meet the Business Manager rules on day one. A participating local government must approve your plan first.

Visa rules change often, so ask an English-speaking immigration specialist to review your case.

👉 Learn more about the 3 types of visas for doing business in Japan!

Step 4. Hire a bilingual proxy

Every filing for business registration in Japan must be in Japanese. Most foreign founders hire licensed professionals for the paperwork.

Each profession covers a defined scope:

• Judicial scrivener (shihō shoshi): company registration at the Legal Affairs Bureau

• Administrative scrivener (gyōsei shoshi): visa applications to the immigration bureau

• Tax accountant (zeirishi): tax notifications and bookkeeping

• Labor and social security attorney (sharōshi): pension and health insurance and labor filings

Only judicial scriveners and lawyers may legally file company registration on your behalf.

Find vetted experts in our directory of corporate lawyers who help with paperwork at the local government office. You can also compare trusted bilingual accounting firms in Tokyo.

How MailMate helps you register your company

MailMate pairs bilingual staff with licensed scriveners. You answer questions in English, and they prepare the required documents in Japanese.

If the Legal Affairs Bureau asks for changes, MailMate relays them to you. A bilingual proxy can also handle translation and follow-up calls.

Step 5. Find office space

Physical office spaces

Finding office space in Tokyo takes time, so start early. Your office address appears on the company registry certificate (tōkibo tōhon) as a full Japanese address.

Office leases often require a security deposit of up to about ten months' rent. A real estate agent with English-speaking staff can shortlist offices within your budget. Also budget for office equipment such as desks, phones and printers.

For flexible options, compare coworking spaces in Tokyo or read our guide to renting an office.

Virtual office address

A virtual office gives you a business address without a lease. It works for company registration and keeps overhead low.

Providers like MailMate add mail handling, forwarding and bill payment. A virtual office is unlikely to satisfy immigration for a Business Manager visa, so check your visa route first.

👉 Read "Virtual Offices in Japan, Explained" for the pros and cons.

Step 6. Register your business and file the required notifications

Registration turns your plan into a legal entity. For a KK or GK, the registration process runs in this order:

• Prepare your articles of incorporation and company seal.

• Notarize the articles at a notary office (KK only).

• Deposit initial capital into a founder's or director's personal bank account.

• File with the Legal Affairs Bureau. The filing date becomes your founding date.

Our guide to company registration in Japan covers every form, fee and deadline.

After registration, file these notifications:

• Local tax office: incorporation notice, payroll office notice and blue tax return approval

• Prefectural and municipal offices: each local government office sets its own deadline

• Japan Pension Service: welfare pension insurance and employees' health insurance, within 5 days of formation

• Labor Standards Inspection Office: labor insurance, once you hire

• Public Employment Security Office: employment insurance, once you hire

• Bank of Japan: a Foreign Exchange Act report, generally within 45 days, for most foreign-owned companies

Sole proprietors join National Health Insurance instead, unless they employ five or more staff. Regulated industries also need licenses before trading, such as alcohol sales, construction and finance.

👉 Read about employees' health insurance and pension insurance in Japan.

Step 7. Hire your staff 

You may not need bilingual staff, but you will likely need one bilingual liaison. That person links you with your Japanese-speaking team.

Agencies often promise hires within a week. Strong bilingual hires usually take longer, and agency fees can reach 35% of first-year salary.

Business Manager visa holders must employ at least one qualifying full-time employee. That person must be a Japanese national or hold a status such as permanent resident or spouse visa.

Once you hire, your company must:

• Enroll staff in welfare pension insurance and health insurance

• Register for employment insurance at the Public Employment Security Office

• Deduct withholding income tax from salaries each month

Hiring before you have an entity? An employer of record can employ staff for you. Our guide to Japan payroll covers the monthly cycle.

A virtual assistant can cover many early tasks. 👉 Check out MailMate's bilingual assistant service, an add-on for MailMate's virtual mail service.

Step 8. Run your business: tax, bookkeeping and compliance

Setup is only half the job. Your business operations bring regular filings from the first fiscal year.

• Corporate tax: file a return within two months of your fiscal year-end. See corporate tax in Japan and how the Japanese fiscal year works.

• Consumption tax: companies with under ¥10 million in capital are usually exempt for their first two years. The exemption does not apply with ¥10 million or more in capital, which includes every Business Manager visa company. It also ends if you register for the invoice system, or if a large company owns over 50% of yours. Read our consumption tax guide.

• Bookkeeping: keep digital records under the Electronic Bookkeeping Act. Our guide to bookkeeping in Japan covers the basics.

• Brand protection: file a trademark registration request with the Japan Patent Office. See trademark registration in Japan.

• Funding: check subsidies for startups in Japan and English-speaking startup support.

For tax planning before launch, read what startups should know about Japan tax.

Banking, initial capital and operational readiness

Banking is often the first major delay for foreign entrepreneurs. Plan the sequence before you file.

Capital deposit and registration sequence

For a KK or GK, the typical flow is:

• Prepare a detailed business plan and all the required documents.

• Deposit initial capital into a founder's or representative director's personal bank account.

• Complete company registration at the Legal Affairs Bureau.

• Apply for a corporate bank account with your registry certificate.

• Move the initial deposit into the company bank account.

If every founder and director lives overseas, a third party can receive the deposit under a power of attorney. A branch office draws capital from its parent company instead.

Corporate bank account

You need a corporate bank account for day-to-day business operations. Keep client payments, supplier bills and payroll out of any personal bank account.

Banks usually ask for:

• The company registry certificate

• The company seal registration certificate

• ID for the person applying

• A bank seal

• A clear business purpose, backed by your business plan and website

Each bank screens new companies and may decline without giving reasons. Prepare a short company profile in English and Japanese to speed up review.

Revenue stamps and notarization

Paper articles of incorporation need revenue stamps; electronic articles do not. Only a KK needs notarization at a notary office, while a GK skips it.

How much does starting a business in Japan cost, and how long does it take?

Government fees run about ¥170,000 to ¥250,000 for a KK and ¥60,000 to ¥100,000 for a GK. Professional fees often add ¥200,000 to ¥500,000.

Capital changes the bill. The registration tax is 0.7% of capital, so ¥30 million in capital means ¥210,000 for a KK or a GK. Business Manager visa founders should budget about ¥260,000 to ¥300,000 in government fees for a KK.

A certificate from your city's startup support program halves the registration tax. At the minimum rate, it drops to ¥75,000 for a KK or ¥30,000 for a GK.

A Business Manager visa also needs ¥30 million in capital. See the real cost of starting a business in Japan for a full breakdown.

Frequently asked questions

Can a foreigner start a business in Japan?

Yes. Foreign nationals can own 100% of a Japanese company, and directors can live overseas. Running the business from Japan depends on your residence status. Most foreign entrepreneurs need a Business Manager visa or a Startup Visa. A bilingual lawyer or immigration specialist can review your case.

Can a US citizen start a business in Japan?

Yes. US citizens follow the same rules as other foreign nationals. You choose a business structure, register with the Legal Affairs Bureau and secure a status of residence that lets you manage it. Start by conducting market research, and review the US-Japan tax treaty with a tax accountant.

Do I need a business visa to start a business in Japan?

It depends on your current status of residence. Permanent residents, long-term residents and spouses or children of Japanese nationals or permanent residents need no business visa. Holders of work visas, such as engineer or specialist, can register a company but cannot manage it. They usually switch to a Business Manager visa first.

How much money do you need to open a business in Japan?

Government fees run about ¥170,000 to ¥250,000 for a KK and ¥60,000 to ¥100,000 for a GK. With the ¥30 million in capital a Business Manager visa requires, the registration tax alone is ¥210,000. Professional fees often add ¥200,000 to ¥500,000. Office rent, staff and seals come on top.

How long does it take to start a business in Japan?

Company setup usually takes two to four weeks. Qualifying fully online filings register within 24 hours, and others take about three business days. A business visa adds time, because the Certificate of Eligibility usually takes one to three months. Opening a corporate bank account adds time that varies by bank.

Which government offices handle starting a business in Japan?

The Legal Affairs Bureau, under the Ministry of Justice, registers companies. After registration, you notify the local tax office, your prefectural and municipal offices, and the Japan Pension Service. Once you hire, you also file with the Labor Standards Inspection Office and the Public Employment Security Office. Most foreign-owned companies also report to the Bank of Japan within about 45 days. The Immigration Services Agency handles business visas, and JETRO offers free support to foreign companies.

Is Japan good for starting a business?

Japan can be a strong market for a new business. It is the fourth-largest economy by nominal GDP, with high consumer spending power. Competition from established Japanese companies is tough, and most procedures happen in Japanese. Thorough market research and local partners improve your odds.

👉 You may also be interested: Franchise Opportunities in Japan: Guide to Business Success

In closing

Starting a business in Japan takes careful planning, but the path is predictable. Check your residence status, choose a structure, then register and file on time.

Most delays come from visa gaps, banking and Japanese paperwork. Bilingual professionals can solve all three.

Ready for the filing itself? Follow our step-by-step guide to company registration in Japan.