Japan allows a company to be incorporated with capital of just ¥1. For some foreign founders seeking to run that business from the country, the amount required can rise to ¥30 million.
Japan’s corporate rules offer entrepreneurs a remarkably low entry point. A Kabushiki Kaisha, the country’s standard joint-stock company, or a Godo Kaisha, which resembles a limited liability company, can be established with capital starting at ¥1.
That figure tells only part of the story.
While ¥1 may satisfy the legal capital requirement, it does not cover registration taxes, office costs, professional fees, licences, staffing or the cash needed to operate the business. For foreign founders, immigration and tax rules can make the gap between incorporation and actual operation much wider.
The registration and licence tax for establishing a Kabushiki Kaisha is 0.7% of its stated capital, with a minimum payment of ¥150,000, according to Japan’s Ministry of Justice.
Founders may also need to pay for notarisation of the articles of incorporation, company seals, a registered office and professional support. Businesses in regulated sectors face additional licensing requirements.
In other words, ¥1 is enough to put a company on the corporate register. It is not enough to put that company into business.
— The Immigration Divide
The distinction became more significant after Japan tightened the requirements for its “Business Manager” status of residence on October 16, 2025.
Foreign nationals do not gain the right to live in Japan simply by owning shares in a Japanese company or becoming its representative director. Those who want to reside in the country and manage the business generally need an appropriate status of residence.
Under the revised Business Manager framework, a corporate business must generally have at least ¥30 million in capital. It must also employ at least one qualifying full-time worker.
The applicant or a full-time employee must demonstrate the level of Japanese-language ability required by the immigration authorities. The business manager must also hold a prescribed master’s or professional degree, or have at least three years of relevant management experience.
The business plan is subject to outside scrutiny. It must be assessed for detail, reasonableness and viability by an eligible professional, such as a Japanese certified public accountant, certified tax accountant or registered small and medium enterprise management consultant.
The company must also secure premises appropriate to the scale and nature of its operations. Using a private home as the business office is, in principle, no longer accepted under the revised rules.
The requirements are set out by Japan’s Immigration Services Agency. JETRO also lists ¥30 million in capital as one of the requirements associated with Business Manager status in its comparison of Japanese business structures.
The result is an apparent paradox: a foreign investor can legally establish and own a Japanese company with capital of ¥1, yet still be unable to live in Japan to manage it.
The two rules serve different purposes. Company law determines whether a legal entity can be formed. Immigration law examines whether the underlying business is substantial and sustainable enough to support residence in Japan.
— The Tax Consequence
Capital set aside for immigration purposes can also affect consumption tax.
Newly established companies generally have no reference period for their first two fiscal periods and may qualify for an exemption from consumption tax. That exemption does not apply when the company has capital or investment of at least ¥10 million at the beginning of the relevant fiscal period.
A company established with ¥30 million to meet Business Manager requirements would therefore generally be treated as a taxable business from its first fiscal period.
Japan’s National Tax Agency says newly formed companies meeting the ¥10 million threshold must file consumption tax returns for the relevant period.
Keeping capital below ¥10 million does not automatically secure an exemption. A company can still become liable for consumption tax if it registers as a qualified invoice issuer, exceeds the applicable sales or payroll threshold, elects taxable status or falls within another statutory exception.
That creates a trade-off for foreign founders. The capital required to support an immigration application can simultaneously remove a tax exemption that might otherwise be available to a small, newly established company.
— Incorporation Is Only the First Test
A one-yen company remains legally possible, but the structure has limited practical value for most operating businesses.
Banks, landlords, commercial partners and licensing authorities conduct their own checks. A registration certificate alone may not be enough. The company may still need to show a credible business model, identifiable funding, suitable premises and evidence that genuine operations are planned or already underway.
For founders who already hold a status of residence without restrictions on business activities, immigration may be less of a concern. They still need enough capital to fund the company and satisfy counterparties that it is more than a paper entity.
For those relying on Business Manager status, the more relevant question is no longer how little capital is legally needed to establish a company. It is how much money the business needs to meet immigration rules, pay its taxes and remain operational.
Japan may allow a company to begin with ¥1. Running it — and securing the right to manage it from inside the country — is a far more expensive proposition.
Updated August 18, 2026. This article provides general legal and management information and does not constitute advice for any specific case.
GTB Holdings