Q86: I am considering entering the Japanese market. Are there any tax-saving measures I can take before establishing a company?

A: Welcome to Japan, to all who are considering expanding into the Japanese market! Please feel free to ask any questions you have about business development in Japan. This time, you've asked about tax-saving measures before company establishment, so let me address that in detail.

Commentary from a Japanese tax accountant

Firstly, it's important to consider three key elements before establishing a company: capital amount, fiscal year, and start-up costs.

Regarding the capital amount, careful consideration is necessary to benefit from consumption tax exemption and tax benefits from the first fiscal year of establishment. If the capital is less than 10 million yen, it qualifies for consumption tax exemption. If it is between 10 million and 100 million yen, you may be eligible for tax benefits. However, be aware that the benefits applicable depend on the scale of the parent company.

Next, setting the fiscal year is crucial from a tax-saving perspective. The timing of consumption tax liability can be adjusted by setting the fiscal year, as it depends on the sales within a specific period.

Lastly, regarding start-up costs, these expenses can be deducted as losses, allowing for tax savings. Ensure to keep receipts and other proof to account for these expenses.

By considering these points and preparing before company establishment, you can implement effective tax-saving strategies. If you have any consultations or questions about business expansion in Japan, our Japanese tax accountants, who are proficient in English, are here to support you.

We are English-speaking Japanese tax accountants ready to assist at any time.

Japanese Certified Public Accountant ・English-speaking Japanese tax accountants Hiroya Aihara
Ringo Tax Corporation

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