I took a big leap, and I landed! Not only that, I survived my first year as an entrepreneur in Japan! As of May 19, 2022, my company, Kabushiki Kaisha EDO BEAUTY LAB, is officially 1 year old! This blog post is all about sharing what I’ve learned in my first year, namely, 3 things to do before starting a company in Japan.
3 Things To Do Before Starting a Company in Japan
1. Go To City Hall
The very first thing you should do before starting a company in Japan is head straight to city hall or town hall (役所 // yakusho).
This is where you’ll get all the CORRECT and UP-TO DATE information you need on obtaining low interest loans, taking business classes, and applying for any necessary permits.
If you live in one of Tokyo’s 23 wards, Saitama City, Yokohama, or Nagoya, chances are you will visit a kuyakusho (区役所).
Otherwise, you will make a trip to a shiyakusho (市役所), machiyakuba (町役場) or murayakuba (村役場).
Do not waste your time going to a branch office (事務所) — Go directly to the main office.
To find out what kinds of startup grants/loans and programs are available, simply Google: “city name + 創業支援” or “city name + 起業支援.”
In my case, I’m a resident of Edogawa City in Tokyo. My company, [EDO BEAUTY LAB], is also based here.
It originally started out as an idea that I submitted to the Edogawa Business Plan Contest in summer 2020. After receiving feedback from the judges (along with an award of 100,000 yen) I decided to turn [EDO BEAUTY LAB] into an actual company.
I signed up for a 6 session business seminar, which was offered through Edogawa City. The classes were only 10,000 yen, but most importantly, completing the seminar enabled me to take advantage of a program available to entrepreneurs in Japan.
This program, called tokutei sougyou shien tou jigyou (特定創業支援等事業) in Japanese, roughly translates to “Project For Special Entrepreneurial Support.”
Basically, it’s a support system run at the municipal level to help people on the path to entrepreneurship.
One of the biggest benefits of this program is that you can qualify to have your business registration taxes (登録免許税 // touroku menkyo zei) cut in half!
In the case of a kabushiki kaisha (株式会社), I was expected to pay at least 150,000 yen in registration taxes. However, since I attended the business seminar, I only had to pay 75,000 yen!
I used the money I saved in registration taxes to hire an administrative scrivener to take care of all the paperwork necessary to formally register my company.
There are (as of June 2021) 1,453 municipalities across Japan that participate in this program.
I also successfully applied for a small business loan via city hall and am constantly looking at their list of available grants and loans.
Therefore, the first thing you do before starting a company in Japan is head straight to city hall!
2. Hire An Administrative Scrivener
So, you’ve done your research, gone to city hall, and gotten all the information you need to start a company in Japan! Fantastic! The next thing you should do is file paperwork to formally register your company.
I recommend that you hire an administrative scrivner, known as a gyosei shoshi (行政書士) to help you with the paperwork
An administrative (or legal) scrivener can file for government licenses and permits on your behalf. They also can give you legal advice.
Before I move on, I will make it clear:
You absolutely DO NOT need to hire an administrative scrivener to help you file paperwork when starting a company in Japan.
In fact, when I went to city hall, my case worker recommended this book to me:
Yoku Wakaru Kabushiki Kaisha no Tsukurikata to Un ei
株式会社のつくり方と運営
True to its title, every single step of registering a company in Japan is broken down into easy-to-understand chapters. Even small details like choosing a titanium stamp over a wooden or ivory stamp is all laid out in this book.
In the end, I opted for a legal scrivener for 2 reasons:
1. I already budgeted 150,000 yen in registration taxes, so I used the money I saved in STEP 1 to hire an administrative scrivener.
2. COVID was still very much a thing threat at the time, and I was wary of going out. Plus, I didn’t want to take my daughter all over town to gather and submit paperwork. I ended up doing everything via email.
In fact, I only met my administrative scrivener ONCE, which was when I went to his office to pick up my documents.
3. Get A Tax Accountant
The last, but perhaps, most important thing you should do before starting a company in Japan is to get yourself a tax accountant.
A zeirishi, (税理士) or tax accountant, will help you navigate local and national tax laws, corporation tax, consumption tax, tax returns, and everything else in between.
You certainly don’t need to make a trip to city hall, and you can fill out all the paperwork to register a company on your own.
HOWEVER…
…under no circumstances should you skip out on hiring a tax accountant!
Japanese tax law is extremely complicated and always changing. Do yourself a favor and leave the taxes to a professional so you can focus on growing your business.
Plus, a skilled tax accountant can identify ways you can cut costs (and save on taxes)!
One of the best things about having a tax accountant is monthly meetings known as getsuji houmon (月次訪問).
Either your tax accountant visits you or you go to their office, and you both go over the sales/revenue and expenses of the previous month and plan for the next month.
Hiring a tax accountant doesn’t mean that you should slack off when it comes to expenditures. I make an effort to attend tax seminars run by the local tax office so I have an idea of what’s going on.
However, knowing that you have a qualified professional in your corner boosts confidence and lessens the mental load and stress of running a business in Japan.
3 Things To Do Before Starting a Company in Japan — Review
To recap, here are 3 things you should do before starting a company in Japan:
1. Go To City Hall
2. Hire an Administrative (Legal) Scrivener
3. Get A Tax Accountant
Overall, my first year as a solo entrepreneur in Japan has been overwhelmingly positive, especially when it comes to support at the municipal level. It’s absolutely incredible that something that started as an idea turned into an actual business, and I finally feel like I can let go of imposter syndrome.
I will be making use of TikTok to document YEAR 2 of my journey. I’ll also answer questions about solo entrepreneurship and starting a company in Japan. See you there: www.tiktok.com/@wadateni
Read more about my start-up journey in Japan:
[EDO BEAUTY LAB] Green Beauty From Edogawa, Japan
How I Started a Company in Japan
3 Things To Do Before Starting a Company in Japan
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