How to Set Up Business in JapanCost Estimation

Basic Premises of Model Case

  • The model case is based on the most typical form of new business operations established by foreign firms entering the Japan market with an initial staff of two: one person from the foreign firm (who usually serves as managing director) and a Japanese national (manager-level person).
  • The company makes use of a temporary office to establish a corporation or branch office and then moves into a permanent office (rented).
  • The representative in Japan stays at a hotel or a monthly-contract apartment during the preparation period and then moves to a permanent residence upon the completion of company registration.
  • Applications and filings are handled by professional service providers.
  • Regarding the details of the model case commentary, refer to the following link.
  • Model Case Commentary: Business Setup
The following is an example case. You start setting up a company with two - person staff a staff of two people: a foreign national who is a managing director and a Japanese who is a manager recruited through a staff agency. After staying at a temporary office for three months,the company relocates to a permanent office in central Tokyo. Approximate floor space of the office is 50 sq.m. After a temporary stay at an extended-stay apartment for three months,the foreign managing director relocates to permanent housing in central Tokyo. Approximate floor space is 60 - 70 sq.m.

Initial Costs in Tokyo

Subsidiary: About 264,000–289,000 USD; Branch: About 70,000–101,000 USD

For the establishment of a Japanese corporation or a branch, the costs are generally as follows. See below for details.

1. Company establishment and related filings

Subsidiary: About 6,200 USD; Branch: About 4,500 USD
(Unit: USD; converted at 1 USD = 159.19 JPY)
Details Subsidiary
(Kabushiki Kaisha) 		Branch Criteria/Remarks
Costs to register company 1,570

 628

 Registration and license tax, stamp tax for article of incorporation, notarization fee, etc.
Name seals for company and personal use 188

 188

 Price for standard kit (four company seals: registered seal, square seal, seal used for bank transactions, a rubber stamp) at a major seal chain store in Japan.
Professional fees for company
registration and filings
(through a proxy) 		1,885

 1,570

 Includes fees to prepare affidavit(s).
Prior investment filing with
the Bank of Japan
(through a proxy)
 628

 471

 Depends on the type of business and job description.
Post-investment filing with
the Bank of Japan
 314

 N/A
Tax filings (through a proxy) 628

 628 Depends on the type of business and job description.
Labor and social insurance filings
(through a proxy) 		942

 942
Subtotal 6,156 4,429

2. Paid-in capital

Subsidiary: About 188,500 USD; Branch: N/A
(Unit: USD; converted at 1 USD = 159.19 JPY)
Details Subsidiary
(Kabushiki Kaisha) 		Branch Criteria/Remarks
Paid-in capital 188,454 N/A A company can be registered with a capital of 1 JPY under the Companies Act of Japan, however having capital of 30 million JPY or more is one of the requirements for obtaining the "Business Manager" status of residence.
*Some organizations conduct "Projects for Encouraging Foreign Entrepreneurs to Start Business (Startup Visa)" aimed at increasing the acceptance of foreign entrepreneurs and supporting startups. See "How to Set Up Business in Japan:Section 2. Promoting acceptance of foreign entrepreneurs." for details
Subtotal 188,454 N/A

3. Obtaining visas

About 1,200–3,100 USD
(Unit: USD; converted at 1 USD = 159.19 JPY)
Details Cost for subsidiary and branch Criteria/Remarks
Temporary visitor visa
(short-term stay visa) 		440–1,256 Japan has taken measures concerning the Visa Exemption Arrangements with 74 countries and regions (as of September 2025). Please see the Ministry of Foreign Affairs websiteExternal site: a new window will open for details.
Certificate of eligibility through a proxy (work or long-term stay visa) 1,256–2,199 Commission to a professional service provider (acting as a proxy)  varies depending on a type of visa.
Subtotal 1,256–3,141

4. Setting up an office

About 33,300–58,500 USD
(Unit: USD; converted at 1 USD = 159.19 JPY)
Details Cost for subsidiary and branch Criteria/Remarks
Rent (3 months) for temporary office
(includes security deposit) 		0–6,282 Assuming the use of a temporary office until finding an official location, for a period of up to three months.
Rental fees and required deposits vary among private companies and public organizations that offer such facilities. JETRO IBSCs provide free temporary office space (for free up to 50 business days).
Monthly rent 2,779–4,356 A typical rent for a 70 sq m office in Tokyo's Akasaka and Aoyama districts. See Comparative Survey of Investment-Related Costsexternal link for details. Security deposit is equivalent to about 10 months' rent.
Security deposit (about 10 months of rent) 27,786–43,559
Real estate brokerage fee (equivalent to one month's rent) 2,779–4,356
Subtotal 33,344–58,553
  1. *

    In addition to the above, it costs about 3,140 USD for purchase of office furniture and office automation equipment, communication expenses, etc.

5. Hiring local personnel

About 14,600 USD
(Unit: USD; converted at 1 USD = 159.19 JPY)
Details Cost for subsidiary and branch Criteria/Remarks
Fee paid to a recruiting agency for hiring a manager 14,605 Equivalent to 35% of expected first year salary (Manager class in the non-manufacturing sector). See Comparative Survey of Investment-Related Costsexternal link for details.
Subtotal 14,605

6. Setting up housing (for foreign national)

About 14,400 USD
(Unit: USD; converted at 1 USD = 159.19 JPY)
Details Cost for subsidiary and branch Criteria/Remarks
Monthly rent (includes maintenance fee) 2,406

 Based on average rent for 69.9 sq m apartment at Hiroo in Tokyo's Shibuya ward. See Comparative Survey of Investment-Related Costsexternal link for details.
Deposit two months' rent, key money two months' rent 9,624

 There has been a trend towards reduced or no deposit and key money in recent years.
Real estate brokerage fee (equivalent to one month's rent) 2,406
Subtotal 14,436

International comparison of office rents and labor costs in major cities in Japan and around the world (Tokyo = 100)

A bar chart comparing personnel expenses (engineer in manufacturing) and office rent across major global cities, using Tokyo as the base index of 100. The vertical axis ranges from 0 to 500, indicating relative cost levels, while the horizontal axis lists cities: Tokyo, Osaka, Nagoya, Yokohama, Kobe, Beijing, New York, Hong Kong, London, San Francisco, Singapore, Paris, and Seoul. Each city has two bars: a blue diagonally striped bar representing personnel expenses and an orange bar representing office rent. Tokyo serves as the baseline, with both personnel expenses and office rent set at 100. In Japan, Osaka (approximately 95 for personnel, 58 for rent) and Nagoya (around 96 for personnel, 39 for rent) are noticeably lower than Tokyo in both categories. Yokohama (about 110 for personnel, 47 for rent) and Kobe (around 114 for personnel, 35 for rent) show slightly higher personnel costs but significantly lower office rent. Among overseas cities, New York stands out with very high costs in both categories, at approximately 351 for personnel expenses and 411 for office rent. San Francisco has the highest personnel expenses at roughly 448, while office rent is around 94, slightly below Tokyo. London shows about 274 for personnel and 136 for office rent, and Paris shows around 211 and 144 respectively, both indicating high cost levels compared to Tokyo. Hong Kong is moderately high with approximately 150 for personnel and 82 for rent. Singapore shows relatively balanced costs at about 119 for personnel and 123 for office rent. Seoul is close to Tokyo, with about 106 for personnel and 82 for rent. Beijing shows office rent at approximately 138, which is higher than Tokyo, but personnel expense data is not provided (no bar shown). Overall, the chart illustrates that Japanese cities tend to have lower office rents compared to major global cities, while international financial hubs—especially New York, London, and San Francisco—show significantly higher personnel expenses and/or office costs.

Comparison of business costs in major cities (Tokyo = 100)

Office Rent
Tokyo Osaka Nagoya Yoko
hama 		Kobe Beijing New York Hong Kong London San
Fran
cisco 		Singa
pore 		Paris Seoul
100 58 39 47 35 138 411 82 136 94 123 144 82
Personnel Expenses (Engineer in Manufacturing)
Tokyo Osaka Nagoya Yoko
hama 		Kobe Beijing New York Hong Kong London San
Fran
cisco 		Singa
pore 		Paris Seoul
100 95 96 110 114 - 351 150 274 448 119 211 106
  1. *

    You can download investment-related cost data from 111 cities worldwide from JETRO's Comparative Survey of Investment-Related Costs.

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