The Honest Number First
Foreign companies planning to incorporate in Japan are routinely surprised by the gap between the legal minimum costs and the realistic total cost of having an operational entity.
The legal minimum to incorporate a kabushiki kaisha (KK (株式会社)) with a single yen of capital is approximately ¥250,000 to ¥400,000 in direct government fees and professional charges alone, before registered address, seal production, or ongoing compliance. A godo kaisha (GK (合同会社)) is cheaper at approximately ¥120,000 to ¥250,000 at minimum. In practice, a foreign-owned KK ready for real business operations typically costs ¥500,000 to ¥900,000 in first-year setup costs.
This guide breaks down every cost component so you can plan accurately.
KK vs. GK: The Core Cost Difference
The two main entity types for foreign market entry have structurally different cost profiles.
A KK requires notarial authentication (koshonin ninsho (公証人認証)) of its articles of incorporation (定款 (teikan)) before the entity can be registered. This is a mandatory step under the Companies Act (会社法). A GK does not require notarial authentication, which eliminates one of the larger fixed cost items and reduces the mandatory government fee floor.
Registration tax (toroku menkyo zei (登録免許税)) is also higher for a KK: ¥150,000 minimum versus ¥60,000 minimum for a GK.
The result is that a GK is meaningfully cheaper to form at the point of incorporation. The tradeoff is that a GK carries lower institutional recognition with banks, customs authorities, and enterprise clients, and is not suitable for regulated activities that require a KK structure.
Component 1: 定款 Authentication and Stamp Costs
KK
The 定款 of a KK must be authenticated by a notary public (公証人) before the company can be registered. This authentication confirms that the articles meet the legal requirements under the Companies Act (会社法) and attaches the notary's seal.
(a) Paper 定款: If the 定款 is prepared as a paper document, it is subject to ¥40,000 in revenue stamp duty (shuunyuu inshi (収入印紙)) in addition to the notary authentication fee. The authentication fee itself is approximately ¥50,000 to ¥55,000 depending on the notary office and the number of certified copies requested. Total at the notary for a paper 定款: approximately ¥90,000 to ¥95,000.
(b) Electronic 定款 (電子定款 (denshi teikan)): If the 定款 is prepared and submitted electronically using a digital signature, the ¥40,000 revenue stamp is not required. Only the notary authentication fee applies: approximately ¥50,000 to ¥55,000. This path requires the preparing professional to have the technical capability to produce a compliant electronic 定款 file; many judicial scriveners (司法書士 (shihoshoshi)) and some online incorporation services offer this.
Practical result: Choose electronic 定款 for a KK. It saves ¥40,000 compared to paper with no material difference in outcome.
GK
A GK does not require notarial authentication of its 定款 under the Companies Act (会社法).
(a) Paper 定款: ¥40,000 revenue stamp applies.
(b) Electronic 定款: No stamp, no notary fee. Cost at this stage: ¥0.
Practical result: Use electronic 定款 for a GK wherever possible. It eliminates this cost component entirely.
Component 2: Registration Tax (登録免許税)
Registration of the company at the Legal Affairs Bureau (法務局 (homukyoku)) requires payment of registration and license tax (登録免許税).
The tax is calculated as 0.7% of stated capital, subject to statutory minimums:
(a) KK: Minimum ¥150,000. For a KK with stated capital below approximately ¥21.4 million, the minimum applies and you pay ¥150,000 regardless of capital amount. Above ¥21.4 million, 0.7% of capital applies and exceeds the minimum.
(b) GK: Minimum ¥60,000. For a GK with stated capital below approximately ¥8.6 million, the minimum applies and you pay ¥60,000.
Most foreign-owned entities incorporating with modest initial capital (¥1,000,000 to ¥10,000,000) pay the minimum rate: ¥150,000 for a KK, ¥60,000 for a GK.
Note: If you later increase stated capital (shihonkin zoshi (資本金増資)), additional registration tax applies to the incremental capital at 0.7% with no new minimum.
Component 3: Judicial Scrivener (司法書士) Fees
The registry filing at the Legal Affairs Bureau must be prepared and submitted by a qualified judicial scrivener (司法書士) or, in some cases, by the incorporators acting directly. In practice, virtually all foreign-owned entities use a scrivener.
Fee ranges (R2 - market rate, not regulated):
(a) Basic package (single-person GK or KK, standard scope): ¥50,000 to ¥80,000 from online or discount providers.
(b) Standard professional package (Tokyo, Osaka major firms): ¥80,000 to ¥150,000 for KK; ¥60,000 to ¥100,000 for GK. Typically includes 定款 drafting consultation, registry preparation, and filing.
(c) Complex scope (multiple directors, complex 定款 目的 (mokuteki) clause, foreign-language coordination): ¥120,000 to ¥200,000+.
Scrivener fees are the most variable line item. Online-only low-cost providers are suitable for simple structures. For foreign companies that need careful 定款 目的 clause drafting (see below), a professional with experience in foreign-owned entities is worth the additional fee: a deficient 目的 clause costs ¥30,000 in registration tax plus scrivener fees to correct later, and may create problems with banks and customs authorities in the interim.
Component 4: 定款 目的 Clause - Why This Matters
The 定款 目的 clause defines the company's business purposes and is a scrutinized document. Banks, customs authorities, and enterprise counterparties review it before opening accounts or establishing business relationships.
A 目的 clause that is too narrow causes: bank account application refusals, customs authority challenges to import declarations, and difficulties with enterprise clients who verify the company's stated scope.
A 目的 clause that is well-drafted and broad covers all anticipated business activities including a catch-all clause (前各号に附帯関連する一切の業務) and is written once at formation. Amending it later requires a shareholder special resolution (株主総会特別決議), ¥30,000 in registration tax, and a scrivener fee of ¥30,000 to ¥50,000. Write it correctly at incorporation.
Component 5: Corporate Seal (会社印 / 法人印)
A Japanese company requires a corporate seal (会社印 (kaishain) or 法人印 (hojinin)) for official use. A standard set for a foreign-owned company typically includes:
(a) 代表者印 (daihyosha-in): The representative director's official seal, registered with the Legal Affairs Bureau. This is the seal with the highest legal authority, used on contracts and official documents.
(b) 銀行印 (ginko-in): The seal registered with the corporate bank account. Separate from the 代表者印 for security reasons.
(c) 角印 (kaku-in): A square company seal used on invoices and general correspondence.
Cost:
(a) Basic resin seal set (three seals): ¥10,000 to ¥20,000. Functional but not premium.
(b) Mid-range titanium or precious wood set: ¥20,000 to ¥50,000. Common for client-facing entities.
(c) Premium set: ¥50,000+. Not required unless there is a specific brand or client-facing reason.
Most foreign companies forming a new entity purchase a mid-range set at ¥20,000 to ¥30,000. The seal can be ordered online from a seal manufacturer (印鑑業者) and is typically delivered in 3 to 7 business days.
Component 6: Registered Address (登録住所)
Every Japanese company must maintain a registered address (toroku jusho (登録住所)) in Japan, which appears on the commercial registry. This address is publicly searchable.
Options and indicative costs:
(a) Virtual office / registered address service: The most common choice for foreign-owned entities that do not yet have physical operations in Japan. Providers range from ¥5,000 per month (basic address only, limited credibility with banks) to ¥30,000 per month for business-district addresses with mail handling. Aplash's registered address service is available at ¥50,000 per month; the Osaka address provides an established business-district location suitable for customs and bank purposes.
(b) Physical office (own lease): Monthly rent for a small private office in Tokyo CBD: ¥100,000 to ¥300,000 or more depending on size and location. Appropriate for companies with Japan-based staff.
(c) Coworking / serviced office address: Some providers offer address registration services as part of a coworking membership. Bank acceptance varies; confirm with your target bank before committing to a specific address provider.
Bank account note: The registered address provider matters for bank account applications. Major banks (megabanks) scrutinize the registered address heavily for foreign-owned entities. An address at a provider with low bank recognition significantly reduces account application success probability. Verify bank acceptance before selecting an address provider, not after.
Component 7: Translation and Notarization of Foreign Documents
Foreign companies incorporating a Japan subsidiary typically need to provide authenticated copies of:
(a) Parent company certificate of incorporation or equivalent
(b) Parent company board resolution approving the Japan incorporation and the initial representative director appointment
(c) Identity documentation for directors and shareholders
These documents typically require:
- Certified translation into Japanese
- Apostille or notarization depending on the originating country and Japan's treaty relationship with it
This cost is outside Aplash's scope and must be arranged independently by the client through their home-country legal counsel or a certified translation agency. Typical cost: ¥30,000 to ¥80,000 per document for certified translation; notarization or apostille fees vary by country.
Budget ¥100,000 to ¥300,000 for the full documentation package for a foreign parent company. This is often the component that causes the most delays if not planned early.
Component 8: First-Year Operational Costs
Formation is only the beginning. An operational entity incurs ongoing costs that are relevant to total first-year planning:
(a) Corporate bank account (first-year banking fees): Major banks typically charge ¥0 to ¥2,000 per month in account maintenance fees for basic business accounts. However, as covered in detail in Japan Corporate Bank Account Guide, account approval for foreign-owned entities is challenging. Budget time and potentially the cost of reapplications rather than just the ongoing fee.
(b) Tax registration and first-year filings: Japan corporate tax (法人税法), local business tax, and consumption tax (消費税法) registration and compliance. A certified tax accountant (税理士 (zeirishi)) typically charges ¥200,000 to ¥500,000 per year for basic monthly bookkeeping and annual tax filings for a small foreign-owned entity. This is a recurring cost, not a one-time formation fee.
(c) Social insurance enrollment: If the company hires employees in Japan, social insurance (shakai hoken (社会保険)) and labor insurance (rodo hoken (労働保険)) registration and contribution obligations apply from day one of employment. These are structural costs that grow with headcount.
(d) Annual KK statutory meeting: A KK must hold an annual shareholders' meeting (teiji kabunushi sokai (定時株主総会)) within three months of the fiscal year end. Documentation and filing requirements apply. A GK does not have the same statutory meeting requirement. See Japan KK and GK Annual Compliance Guide for the full annual compliance checklist.
Full Cost Summary: What a Typical Foreign-Owned Entity Costs
KK with Electronic Typical Mid-Range (定款)
(a) 定款 notary authentication: approximately ¥52,000
(b) Registration tax: ¥150,000 (minimum, applies to capital below approximately ¥21.4 million)
(c) Judicial scrivener (standard professional): ¥80,000 to ¥120,000
(d) Corporate seal set (mid-range): ¥20,000 to ¥30,000
(e) Registered address (Aplash or equivalent business-district provider, first three months): ¥150,000
(f) Foreign document translation and authentication: ¥100,000 to ¥200,000
Formation total (KK): approximately ¥550,000 to ¥750,000 before any year-one operational costs.
GK with Electronic Typical Mid-Range (定款)
(a) 定款 (electronic): ¥0
(b) Registration tax: ¥60,000
(c) Judicial scrivener: ¥60,000 to ¥80,000
(d) Corporate seal set: ¥20,000 to ¥30,000
(e) Registered address (first three months): ¥150,000
(f) Foreign document translation and authentication: ¥100,000 to ¥200,000
Formation total (GK): approximately ¥390,000 to ¥520,000.
The Alternative: Acquiring an Existing Shell KK
For foreign companies where the primary concern is a corporate bank account rather than custom 定款 drafting, acquiring an existing dormant KK with an active bank account eliminates the account-opening risk entirely.
An existing entity carries operating history and an established banking relationship. The acquirer changes the representative director, registered address, and 定款 目的 as needed. The bank relationship transfers subject to KYC re-verification with the new representative director.
Aplash's shell KK acquisition service starts at JPY 2,000,000 all-inclusive for a standard dormant entity in a non-FEFTA designated industry. This is approximately 2.5 to 3 times the cash cost of fresh incorporation, but the premium buys certainty on the bank account problem - the single largest operational risk for foreign-owned newly incorporated entities.
See Japan Shell Company Acquisition and Japan Corporate Bank Account Guide for when this path makes more sense than fresh incorporation.
How Aplash Can Help
Aplash advises on Japan entity formation strategy: choosing the right entity type, drafting a 定款 目的 clause that works for the company's intended business scope, coordinating the registered address, and positioning the formation for bank account success.
For clients entering Japan through import activity, we assess whether an IOR structure (no Japan entity required) or a local entity is the right first step. Formation cost is only part of the equation; the right structure for the client's business model is the more important question.
See also: KK vs. GK Guide, Japan Company Incorporation Guide, Japan Branch Office vs. Subsidiary, and Japan Paid-In Capital Guide.
This article is for informational purposes. It does not constitute legal, tax, or financial advice. Government fees and professional rates are subject to change; verify current rates with a qualified Japan-licensed judicial scrivener (司法書士) and tax accountant (税理士) before incorporation.