{"id":207,"date":"2023-04-24T12:51:15","date_gmt":"2023-04-24T12:51:15","guid":{"rendered":"https:\/\/companyformationjapan.com\/?p=207"},"modified":"2023-11-08T10:09:11","modified_gmt":"2023-11-08T10:09:11","slug":"set-up-a-branch-in-japan","status":"publish","type":"post","link":"https:\/\/companyformationjapan.com\/set-up-a-branch-in-japan\/","title":{"rendered":"Set up a Branch in Japan"},"content":{"rendered":"\n<p>A<strong>&nbsp;branch&nbsp;<\/strong>office<strong>&nbsp;in Japan<\/strong>&nbsp;represents a supplementary location through which a foreign company can expand to Japan.<\/p>\n\n\n\n<p>The branch office is not an independent business entity from its foreign parent company and it performs the same business activities.<\/p>\n\n\n\n<p>The Japanese branch can be a suitable option as it allows a foreign company to engage in more complex activities, compared to the representative office for which no commercial actions are allowed. Although not acting in its own name, the branch will be able to have a bank account in Japan as well as lease property in its own name.<\/p>\n\n\n\n<p>Our&nbsp;<a href=\"https:\/\/www.companyformationjapan.com\/about-us\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>company formation advisors in Japan<\/strong><\/a>&nbsp;can guide you through the entire process of setting up such an office in this country&nbsp;if this is a suitable option. Read below more about the branch, its characteristics and registration and reach out to us to find out more about how we can assist you.<\/p>\n\n\n\n<table class=\"redTable\">\n\t<thead>\n\t\t<tr>\n\t\t\t<th>\n\t\t\t\t&nbsp;Quick Facts<\/th>\n\t\t\t<th>\n\t\t\t\t&nbsp;<\/th>\n\t\t<\/tr>\n\t<\/thead>\n\t<tbody>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\t&nbsp;Applicable legislation (home country\/foreign country)<\/td>\n\t\t\t<td>\n\t\t\t\t<p>\n\t\t\t\t\tThe branch is incorporated per the corporate law<\/p>\n\t\t\t<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\t<p>\n\t\t\t\t\tBest Used For<\/p>\n\t\t\t<\/td>\n\t\t\t<td>\n\t\t\t\tEstablishing the presence of a foreign company in Japan<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\t<p>\n\t\t\t\t\tMinimum share capital (YES\/NO)<\/p>\n\t\t\t<\/td>\n\t\t\t<td>\n\t\t\t\t&nbsp;No<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tTime frame for the incorporation (approx.)<\/td>\n\t\t\t<td>\n\t\t\t\t1 month&nbsp;<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tDocuments to be filed by parent company<\/td>\n\t\t\t<td>\n\t\t\t\tArticles of Incorporation and registration certificate<br \/>\n\t\t\t\tProof of address<br \/>\n\t\t\t\tInformation about the appointed representative and the decision to appoint thereof<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tManagement (Local\/Foreign)<\/td>\n\t\t\t<td>\n\t\t\t\t<p>\n\t\t\t\t\tForeign<\/p>\n\t\t\t<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tLegal representative required (YES\/NO)<\/td>\n\t\t\t<td>\n\t\t\t\t<p>\n\t\t\t\t\tyes<\/p>\n\t\t\t<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tLocal bank account (YES\/NO)<\/td>\n\t\t\t<td>\n\t\t\t\tyes<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tIndependence from the parent company<\/td>\n\t\t\t<td>\n\t\t\t\tNo<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tLiability of the parent company<\/td>\n\t\t\t<td>\n\t\t\t\tFully liable<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tCorporate tax rate<\/td>\n\t\t\t<td>\n\t\t\t\t30%-34% including local taxes&nbsp;<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tAnnual accounts filing requirements&nbsp;<\/td>\n\t\t\t<td>\n\t\t\t\tyes<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tPossibility of hiring local staff (YES\/NO)<\/td>\n\t\t\t<td>\n\t\t\t\tyes&nbsp;<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tTravel requirements for incorporating branch\/subsidiary (YES\/NO)<\/td>\n\t\t\t<td>\n\t\t\t\tYes, in most cases.&nbsp;<br \/>\n\t\t\t\tAn appointed representative can assist<\/td>\n\t\t<\/tr>\n\t\t<tr>\n\t\t\t<td>\n\t\t\t\tDouble tax treaty access (YES\/NO)<\/td>\n\t\t\t<td>\n\t\t\t\tyes<\/td>\n\t\t<\/tr>\n\t<\/tbody>\n<\/table>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title \" >Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/companyformationjapan.com\/set-up-a-branch-in-japan\/#what-is-the-general-procedure-of-setting-up-a-branch-in-japan\" title=\"What is the general procedure of setting up a branch in Japan?\">What is the general procedure of setting up a branch in Japan?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/companyformationjapan.com\/set-up-a-branch-in-japan\/#who-can-be-a-representative-of-the-branch-office-in-japan\" title=\"Who can be a representative of the branch office in Japan?\">Who can be a representative of the branch office in Japan?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/companyformationjapan.com\/set-up-a-branch-in-japan\/#how-is-the-japanese-branch-taxed\" title=\"How is the Japanese branch taxed?\">How is the Japanese branch taxed?<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"what-is-the-general-procedure-of-setting-up-a-branch-in-japan\"><\/span><strong>What is the general procedure of setting up a branch in Japan?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Even though a&nbsp;<strong>branch<\/strong>&nbsp;office&nbsp;<strong>in Japan<\/strong>&nbsp;does not have a legal independent status, it can have a bank account under its name&nbsp;and this is helpful for running the operations in Japan In order to set up such an office here, the procedure listed below is necessary:<\/p>\n\n\n\n<ul>\n<li>\u2022<strong> Foreigner and personal seal registration<\/strong>: our&nbsp;<a href=\"https:\/\/www.companyformationjapan.com\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>company registration professionals in Japan<\/strong><\/a>&nbsp;advise you to have the person who is the representative of the branch to effectuate the personal and foreigner seal registration at the beginning;<\/li>\n\n\n\n<li>\u2022 <strong>Decide on the branch registration details<\/strong>: the registration is decided depending on the Articles of Incorporation and the Certificate of Registered Matters of the parent company. Minimum one of the directors must have a local address in Japan;<\/li>\n\n\n\n<li>\u2022<strong> Initiate and certify a sworn affidavit<\/strong>: a Sworn Affidavit is initiated and certified in conformity with the parent company details, based on its Certificate of Registered Matters;<\/li>\n\n\n\n<li>\u2022<strong> Make the seal of the branch representative<\/strong>: in case the representative is not Japanese, this is not required, however, having one can be advantageous;<\/li>\n\n\n\n<li>\u2022 <strong>Apply for the branch office registration with the Legal Affair Bureau<\/strong>: the company representative\u2019s &nbsp;personal seal in Japan is recorded with the Bureau;<\/li>\n\n\n\n<li>\u2022 <strong>Issuance of the Certificate of Seal Registration and Certificate of Registered Matters<\/strong>: the registration may take maximum one week. Then, the&nbsp;<strong>branch<\/strong>&nbsp;office<strong>&nbsp;in Japan&nbsp;<\/strong>is issued with the Certificate of Seal Registration and Certificate of Registered Matters;<\/li>\n\n\n\n<li>\u2022<strong> Other steps<\/strong>: our&nbsp;<a href=\"https:\/\/www.companyformationjapan.com\/company-incorporation-japan\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Japan company formation<\/strong><\/a>&nbsp;representatives can offer more information on what these other steps consist of. They can also help you open any type of company in this country, from&nbsp;<a href=\"https:\/\/www.companyformationjapan.com\/open-a-llc-in-japan\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>LLCs in Japan<\/strong><\/a>&nbsp;to partnerships.<\/li>\n<\/ul>\n\n\n\n<p>Please keep in mind that these steps are only briefly described herein and that, in practice, the process can also include different other requirements.<\/p>\n\n\n\n<p>Our&nbsp;<strong>immigration lawyers in Japan<\/strong>&nbsp;can give you details about the requirements for obtaining work and residence permits for foreign branch employees.<\/p>\n\n\n\n<p>Setting up a branch in Japan is not directly linked to obtaining residency, however, appointed foreign nationals can apply for a visa that will allow them to remain in the country as branch managers. This can be the first step for obtaining permission for&nbsp;<a href=\"https:\/\/www.companyformationjapan.com\/how-to-obtain-a-residence-permit-in-japan\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>residence in Japan<\/strong><\/a>, and in time the holder can also apply for permanent residency. Our team can give you more details.<\/p>\n\n\n\n<p>Discussing these matters with our team is important for those who are interested in&nbsp;<a href=\"https:\/\/www.companyformationjapan.com\/relocate-to-japan\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>immigration to Japan<\/strong><\/a>. If you would like to relocate here not as an appointed branch manager, but as a foreign national employed by a Japanese company, our team will answer questions about the work permit, and about your route to obtaining permanent residency, after a certain number of years.<\/p>\n\n\n\n<p>The registration of a branch in Japan can take approximately one week, however, this estimated time also depends on the country in which the parent company is based.<\/p>\n\n\n\n<p>The foreign company will need to provide certified copies or the original form of the documents issued by the trade register office with which it is duly registered in its country of origin. In some cases, these documents will need to be translated by a sworn translator and certified by a public notary. The costs for preparing the needed documents for branch registration should be taken into account.<\/p>\n\n\n\n<p>In practice, the branch registration and set up process can be considered lighter compared to opening a new LLC in Japan. However, despite these advantages, foreign investors always need to take into account the high level of liability that the branch retains during the entire duration of its activities in Japan. Foreign companies that prefer to separate their activities from those of their Japanese counterpart (and thus limit the liability through the fact that the parent company is not directly liable for the actions of the Japanese equivalent) can choose to set up a subsidiary in the form of an LLC. The parent company will still retain a certain level of control through the fact that it will own shares in the company, however, the new business will be completely separated from the foreign company.<\/p>\n\n\n\n<p>We invite investors to watch the following video if they are interested in branch incorporation:<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-embed-handler wp-block-embed-embed-handler wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<iframe loading=\"lazy\" title=\"Set up a branch in Japan\" width=\"840\" height=\"473\" src=\"https:\/\/www.youtube.com\/embed\/i2zPG9qjTFY?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" allowfullscreen><\/iframe>\n<\/div><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"who-can-be-a-representative-of-the-branch-office-in-japan\"><\/span><strong>Who can be a representative of the branch office in Japan?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In order to be a representative of a<strong>&nbsp;branch<\/strong>&nbsp;office&nbsp;<strong>in Japan<\/strong>, any individual, regardless of his or her nationality, can act as a representative of a&nbsp;<strong>branch office in Japan<\/strong>.<\/p>\n\n\n\n<p>It is important, though, to know that, if you want to&nbsp;<a href=\"https:\/\/www.companyformationjapan.com\/types-of-companies-in-japan\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>open a branch company in Japan<\/strong><\/a>, at least one of the company\u2019s representatives has to be a Japanese resident, under a valid long term visa.<\/p>\n\n\n\n<p>Our&nbsp;<a href=\"https:\/\/www.companyformationjapan.com\/relocate-to-japan\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>immigration lawyers in Japan<\/strong><\/a>&nbsp;can aswer specific questions about the requirements for the foreign representative.<\/p>\n\n\n\n<p>Investors who wish to open a branch in Japan should keep in mind that in certain industries prior approval is needed before making foreign direct investments. For example, the&nbsp;<a href=\"https:\/\/www.boj.or.jp\/en\/index.htm\/\" target=\"_blank\" rel=\"noreferrer noopener\">Bank of Japan<\/a>&nbsp;issues the documents for this purpose, in cases such as finance and insurance activities. Other regulated sectors include manufacture, agriculture and forestry and others.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"how-is-the-japanese-branch-taxed\"><\/span><strong>How is the Japanese branch taxed?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>There is no special branch tax rate in Japan that applies separately from the regular corporate income tax.&nbsp;<\/p>\n\n\n\n<p>The branch is subject to taxation in Japan, including the&nbsp;<a href=\"https:\/\/www.companyformationjapan.com\/japan-consumption-tax\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>consumption tax<\/strong><\/a>, according to the types of goods or services it provides.<\/p>\n\n\n\n<p>The following types of taxes and their rates are relevant when discussing the taxation regime that branch will be subject to:<\/p>\n\n\n\n<ol>\n<li>Corporate income tax: 23.3%, with an effective rate of 30 to 34% when including the applicable local taxes;<\/li>\n\n\n\n<li>Withholding tax: 20% on dividend payments in case of resident, with an effective rate of 20.42% after the surtax; an alternative 15% rate is applicable to non-resident companies in certain cases (15.315% effective rate after the surtax) applies in case of non-residents;<\/li>\n\n\n\n<li>Consumption tax: 10% standard rate and 0% or 8% reduced rate applicable for certain items; export transactions are examples of activities subject to a 0% rate;<\/li>\n\n\n\n<li>Others: social security contributions are applicable at the employer\u2019s level; a real property tax applies at a municipal level and a prefectural real estate tax for acquisitions applies when the Japanese branch purchases property (a percentage of the assessed value of the real estate).<\/li>\n<\/ol>\n\n\n\n<p>Japan has concluded more than 75 double tax treaties.<\/p>\n\n\n\n<p>In terms of tax filing compliance, the branch is asked to file the annual financial statements and the income tax return. The deadline for this filing is within two months after the completion of the tax year and taxes are prepaid within two months after the end of the sixth month of the tax year (two options are available \u2013 either 50% of the tax based on the assessment from the previous year or the effective tax liability incurred in the first six months of the tax year).<\/p>\n\n\n\n<p>The accounting year is not strictly the same as the calendar year, the branch will begin its fiscal year when starting its business operations in the country, however, this period cannot exceed 12 months and in most cases the branch will implement the same tax year as the parent company abroad, its head office.<\/p>\n\n\n\n<p>For complete information about taxation, as well as recent developments in terms of applicable taxes, please reach out to our&nbsp;<a href=\"https:\/\/www.companyformationjapan.com\/accountant-japan\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>accountant in Japan<\/strong><\/a>. We can help you with information about the taxation regime applicable to the branch as well as to any other business form. We advise you to reach out to our tax specialists in order to avoid any penalties that apply on incomplete or incorrect tax reporting as well as underreporting.<\/p>\n\n\n\n<p>If you need to know more about&nbsp;<strong>setting up a branch<\/strong>&nbsp;office&nbsp;<strong>in Japan<\/strong>, we invite you to&nbsp;<a href=\"https:\/\/www.companyformationjapan.com\/contact\"><strong>get in touch<\/strong><\/a>&nbsp;with our&nbsp;<strong>Japan company formation<\/strong>&nbsp;experts.<\/p>\n\n\n\n<p>We can also answer your questions about&nbsp;<strong>immigration to Japan<\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A&nbsp;branch&nbsp;office&nbsp;in Japan&nbsp;represents a supplementary location through which a foreign company can expand to Japan. The branch office is not an independent business entity from its foreign parent company and it performs the same business activities. The Japanese branch can be a suitable option as it allows a foreign company to engage in more complex activities, [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":529,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[44,38,12,9,43],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Set up a Branch in Japan<\/title>\n<meta name=\"description\" content=\"Here is a brief guide on how to open a branch office in Japan. 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