In this article you will learn how to set up a sole proprietorship in Japan.
The process of registering a sole proprietorship in Japan is pretty straight forward. I will walk you through the process of establishing a legal entity in Japan.
Please note that I am not a lawyer or a person with any legal training. Everything in this article is based on my experience setting up my sole proprietorship in Fujisawa, Japan.
How to Register Your New Business
To register your new business, you will need to fill out the necessary paper work at your local tax office. If you don't speak or read Japanese at a proficient level, I highly recommend bringing a native Japanese speaker with you to help make things smoother.
You need to ask for a 個人事業 届出書 (Kojin Jigyo Todokede-sho)
English translation: Personal Business Registration Form.
You'll need to provide the following information:
-Business name (The name you plan to use)
-Business address (The place you will conduct business from)
-Business type (School, restaurant, consulting agency, etc.)
You will also need your personal stamp (hanko) to sign the document.
Tax Information
After filling out the necessary paperwork, the tax official will process your documents and give you information about paying taxes.
This is very important information, so again, I'd recommend bringing a native Japanese person to help you with this because you don't want to get in any legal trouble with the government; especially over taxes.
In Fujisawa where I registered my business, the entire process took about 20 minutes.
Please remember to ask any questions or concerns that you may have because you are now a business owner with legal responsibilities.
Here in Kanagawa, there is a new system that allows you to do your taxes by yourself and e-file them. If you are not a numbers person, or don't have the confidence to do your taxes on your own, I'd highly recommend hiring a CPA to take care of your taxes.
I have a CPA that I have been using ever since I registered my business and they make everything so much easier. CPAs also help you set up long-term plans like buying a house, or educating you on tax credits if you decide to have children in Japan. Hiring a CPA once a year is an added expense, but it's highly worth it because they will keep you in good standing with the law.
After that you can celebrate. You are now a new business owner in Japan. Congratulations!
Remember to keep all of your legal documentation in a safe place and make copies if necessary. And always ask for help if you don't understand something. Running a business is a rewarding journey, but make sure you are compliant with all of the legalities so you can avoid any issues down the line.
Good luck with all of your business endeavors.
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