Cost of Setting Up a Company in Japan: 2026 Budget Breakdown

The honest answer to “what is the cost of setting up a company in Japan?” is that the incorporation fees are the small part. A Godo Kaisha can be registered for under 100,000 yen, and even a Kabushiki Kaisha rarely costs more than about 250,000 yen in government fees. What actually decides your budget is a single question: does the founder need a Business Manager visa to live and run the company in Japan? Since October 2025, that one requirement can put 30,000,000 yen of capital on the table before you count a single lease payment. This guide breaks down the real cost of setting up a company in Japan in 2026, split into one-time setup costs and the ongoing cost of doing business, with every figure in yen first and a US dollar equivalent at approximately 156 yen to the dollar as of 3 August 2026.

This is a companion to our Japan market entry guide, which covers the full entry process. Here we focus only on the numbers, and only on greenfield setup. Buying an existing Japanese business is a different budget with different mechanics.

The Number That Dominates a 2026 Budget: the 30 Million Yen Capital Rule

If the person running the Japan entity needs a Business Manager visa, the largest figure in your budget will not be a fee at all. It will be capital. Japan’s Ministry of Justice promulgated an amended ministerial ordinance on 10 October 2025 that raised the minimum capital for the Business Manager status of residence from 5,000,000 yen to 30,000,000 yen, a six-fold increase, with the new criteria taking effect on 16 October 2025. The change is summarised in this Newland Chase note on the revised Business Manager criteria and in immigration-lawyer guidance on the capital increase from 5 million to 30 million yen.

Two things about that number matter for budgeting. First, 30,000,000 yen (about US$192,000) is registered capital, not a sunk cost. It stays in the company as working capital and can be spent on salaries, rent, and operations once the entity is running. It is not money that disappears. But it is money you must have and inject up front, which makes it the dominant constraint on the cash a founder needs on hand. Second, the reform added conditions beyond capital: the applicant needs either three or more years of management experience or a master’s-level degree in a business-related field, the company must employ at least one full-time staff member, and there is a Japanese-language proficiency expectation at roughly CEFR B2 level for the applicant or the employee.

Not every entrant faces this. A parent company that seconds a manager into Japan on a different status of residence, or that hires a Japan-resident representative rather than relocating a founder, may not need the Business Manager route at all, and therefore may not need to lock up 30,000,000 yen. If you are weighing paths, our comparison of the Startup visa and the Business Manager visa is the place to decide before you size the budget. The rule of thumb: identify who will hold what visa first, because that answer moves the total by an order of magnitude.

One-Time Costs to Set Up a Company in Japan

Statutory incorporation fees (KK vs GK)

The government fees to register the entity are modest and predictable, and they differ by form. For a Kabushiki Kaisha (KK), the registration and license tax is the greater of 0.7% of stated capital or a minimum of 150,000 yen, the articles of incorporation must be notarised, which costs 30,000 to 50,000 yen depending on stated capital, or 15,000 yen for a company under 1,000,000 yen of capital that meets the conditions set in December 2024, and a 40,000 yen revenue stamp applies to paper articles but is waived when the articles are filed electronically. Those components assume the 150,000 yen floor applies; at the 30,000,000 yen capital the Business Manager visa requires, the 0.7% rate governs instead and the registration tax alone is 210,000 yen, lifting KK government fees to roughly 260,000 yen. For a company capitalised below 3,000,000 yen, that puts KK government fees at roughly 180,000 to 240,000 yen (about US$1,150 to US$1,540), depending on the notary band and on whether the articles are filed electronically. For a Godo Kaisha (GK), there is no notarisation requirement and the registration and license tax minimum is only 60,000 yen, so government fees run roughly 60,000 to 100,000 yen (about US$385 to US$640). The registration and license tax rates for both forms are published by the National Tax Agency. The choice between the two forms has consequences well beyond this fee, which we cover in our KK versus GK comparison.

Seals, judicial scrivener, and translation

A few practical line items sit alongside the statutory fees. A set of three company seals (the representative seal, bank seal, and company stamp) costs roughly 10,000 to 30,000 yen. Engaging a judicial scrivener or incorporation service to prepare and file the registration typically adds 100,000 to 300,000 yen (about US$640 to US$1,900), and for a foreign founder who cannot file in Japanese this is usually money well spent rather than an optional extra. Budget a separate line for translation and localisation: articles, key contracts, and the initial Japanese-language website and marketing all cost money that founders routinely forget at the planning stage.

Office: deposit, key money, and the virtual-office alternative

Office space is where the one-time number can balloon. Commercial rent in central Tokyo runs roughly 20,000 to 40,000 yen per tsubo (about 3.3 square metres) per month, so a five-person office of 15 to 25 tsubo can cost between 375,000 and 1,000,000 yen a month before you have paid a single upfront cost. And the upfront costs are steep: Japanese commercial leases commonly require a deposit of several months to roughly a year of rent, often plus key money, so signing a lease can mean laying out the equivalent of many months of rent on day one. A virtual or serviced office is the low-cost alternative and is common for early-stage entry, but confirm it will satisfy the physical-office expectations of a Business Manager visa application before you rely on it, because immigration generally wants to see a genuine, exclusive workspace.

The Ongoing Cost of Doing Business in Japan

Setup is a one-time hit. The cost of doing business in Japan is what recurs every year, and for board planning it usually matters more than the incorporation bill. Our guide to doing business in Japan covers operations in depth; here is the money.

Corporate tax, and the bill you pay even at a loss

Combining national corporate tax with local corporate tax, enterprise tax, and corporate inhabitant tax, the effective corporate tax rate lands around 30 to 31% for most companies, varying by municipality and company size, as detailed in PwC’s summary of Japan’s corporate income taxes. The detail that catches new entrants is the per-capita corporate inhabitant tax: a fixed annual charge starting at about 70,000 yen (about US$450) for a small company with capital of 10,000,000 yen or less and 50 or fewer local employees, and this fixed portion is owed even in a year with no profit. Register with more capital, and the fixed portion rises. So a dormant or loss-making subsidiary is never entirely free to keep open.

Consumption tax

Japan’s consumption tax (shohizei) is a value-added-style tax at a standard rate of 10%. New companies are often outside the taxable-enterprise threshold in their first period, but the qualified-invoice registration regime now pushes many businesses to register from the start in order to issue deductible invoices to their customers, so treat consumption-tax compliance as a running cost from day one rather than a later concern.

Accounting, payroll, and employer social insurance

Outsourced accounting and bookkeeping typically costs 300,000 to 800,000 yen a year (about US$1,900 to US$5,100), with a monthly retainer covering accounting, payroll, and compliance running roughly 30,000 to 100,000 yen depending on headcount and complexity. The larger recurring cost arrives with employees: employer social insurance adds roughly 15 to 16% on top of gross salaries, covering the employer’s share of health insurance, pension, employment insurance, and workers’ accident insurance. Enrolment is mandatory, so factor this into every hire from the first.

Your first hire, or an Employer of Record

Hiring your first employee directly means setting up payroll, enrolling in social insurance, and taking on Japanese labour-law compliance from that person’s first day. An Employer of Record is the alternative: it lets you engage staff in Japan through a third party that acts as the legal employer, which can defer the entity-side payroll build-out while you test the market. Which route is cheaper depends on headcount and how long you expect to run before you need a full local entity anyway. As a rough guide, an Employer of Record tends to be more economical for the first one to a handful of hires and for a defined pilot period, while a growing team eventually makes an in-house payroll and a full entity the lower-cost option. The point for budgeting is that the first hire, not the incorporation, is usually where recurring costs step up.

The exchange rate is part of your budget

For a parent funding the entity from abroad, the yen itself is a cost variable, not a constant. The currency has been unusually volatile: it reached a roughly 40-year low near 163 yen to the US dollar in late July 2026 before coordinated intervention by Japan’s Finance Ministry and the US Treasury pulled it back toward the mid-150s within days, per market data on the Japanese yen. A weaker yen makes a yen-denominated budget cheaper in dollars, which is why 2026 has drawn foreign entrants, but a 5% move in a week also means the dollar cost of the 30,000,000 yen capital requirement can swing by roughly US$10,000 between board approval and the actual transfer. State the rate and date you used, and consider timing the capital injection rather than leaving it to chance.

Costs Founders Routinely Underestimate

A defensible board budget accounts for the line items that do not appear on any incorporation checklist but reliably show up in the first year.

Higher capital raises your fixed tax. The per-capita corporate inhabitant tax is banded by paid-in capital, running from about 70,000 yen a year at the bottom to as much as 3,800,000 yen for the largest companies, as set out in this overview of Japan’s prefectural and municipal per-capita tax. Registering with capital above 10,000,000 yen moves you out of the lowest band. That means the 30,000,000 yen you register to satisfy the Business Manager visa does not only tie up cash; it also lifts this fixed annual tax above the 70,000 yen floor for as long as the capital stays at that level. It is a small recurring cost, but it is a direct, often overlooked consequence of the visa reform.

Banking takes time and a resident face. Opening a corporate bank account is frequently the slowest step in going operational, and in practice Japanese banks will generally not open an account for a company with no Japan-resident representative, even though the law has not required one since 2015. Budget for the delay, and plan to have a resident representative in place, because a company that cannot receive or make payments cannot trade however cleanly it was incorporated.

Consumption-tax registration and non-resident representation. Under the qualified-invoice regime, many new companies register for consumption tax from the outset so they can issue deductible invoices, which brings filing obligations forward into year one. A business without a permanent presence in Japan may also need to appoint a tax representative to handle consumption-tax matters, an added compliance cost that pure exporters sometimes miss.

Renewals and re-registrations. A KK re-registers its directors each time their term ends, with registration tax on each filing, and any change to registered particulars such as address, capital, or representative carries its own registration fee. None of these is large, but they recur, and they belong in a running-cost model rather than a setup one.

Putting It Together: Three Budget Scenarios

Because the total swings so widely on visa and office decisions, a single number is misleading. Three scenarios bracket the realistic range for 2026, all excluding the 30,000,000 yen visa capital where it does not apply:

• Lean, no relocation: a GK, a virtual office, outsourced accounting, no immediate hire, and no founder visa. First-year cash outlay can sit under 3,000,000 yen (about US$19,000), dominated by professional fees and the accounting retainer.
• Founder-run, visa-backed: a founder relocating on a Business Manager visa must hold 30,000,000 yen in capital (about US$192,000), which then funds operations, plus roughly 2,000,000 to 4,500,000 yen of setup and runway spend over the six to eight months to reach operational readiness for a Tokyo entity. The capital is deployable, but the board must approve the full sum up front.
• Staffed subsidiary with a real office: a physical central-Tokyo office, several employees on payroll with social insurance, and localised operations push first-year costs well into the tens of millions of yen, scaling with headcount and space.

Treat these as planning brackets, not quotes. The variables that move your number most are the visa path, whether you take a physical office, and when you make your first hire.

What to Do Now

• Decide the visa path first. Confirm whether anyone needs a Business Manager visa before you size the budget, because the 30,000,000 yen capital requirement dwarfs every other line.
• Choose the entity form on more than fee. The GK saves on incorporation, but pick between GK and KK on governance, disclosure, and funding grounds, not the setup cost alone.
• Model the running cost, not just setup. Include the effective corporate tax of about 30 to 31%, the fixed per-capita inhabitant tax you owe even at a loss, and employer social insurance at 15 to 16% of payroll.
• Price the office honestly. Add deposit and key money to the monthly rent, or start with a virtual office if your visa plan allows it.
• Fix the FX assumption. State the exchange rate and date in your board budget, because a 5% yen move in a week is realistic in the current market.

Key Takeaways

• Incorporation is cheap; capital is not. Government fees are roughly 60,000 to 100,000 yen for a GK and 200,000 to 250,000 yen for a KK, but a Business Manager visa now requires 30,000,000 yen of capital.
• The visa reform is the headline. From 16 October 2025 the Business Manager capital minimum rose from 5,000,000 to 30,000,000 yen, with added experience, employment, and Japanese-language conditions.
• Capital is working capital. The 30,000,000 yen stays in the company and funds operations; it is not a fee, but it must be approved and injected up front.
• You pay tax even at a loss. The per-capita corporate inhabitant tax starts around 70,000 yen a year and is owed regardless of profit.
• Running costs beat setup costs. Corporate tax near 30 to 31%, consumption tax at 10%, accounting retainers, and employer social insurance at 15 to 16% of salaries define the real annual budget.
• Your first hire is the step-up. Recurring costs rise most when you add payroll and social insurance, whether directly or through an Employer of Record.

What to Read Next

• Japan Market Entry: The Complete Guide for 2026
• Japan Business Manager Visa 2026: Requirements Guide
• Japan Market Entry Services