Start a Business in Japan on a Work Visa: Complete 2025 Guide

Japan, the world’s third-largest economy, offers tremendous opportunities for entrepreneurs—from innovative tech ventures to boutique cafes and consulting businesses. But for foreigners already living and working in Japan on a work visa, the idea of starting a business raises many legal, financial, and procedural questions.

So, can you start a business while on a work visa in Japan?
Yes, but with conditions. The answer depends largely on your current visa type, your business goals, and whether you’re ready to meet the legal requirements for self-employment or company formation.

This guide covers all the key paths available to foreign entrepreneurs—whether you want to scale a company with employees or work solo as a freelancer.

Starting a Business in Japan While Holding a Work Visa: Is It Possible?

If you’re employed full-time in Japan and hold a standard work visa, you’re likely restricted to the specific type of activity for which your visa was issued. These include categories like:

• Engineer / Specialist in Humanities / International Services
• Instructor
• Skilled Labor
• Intra-Company Transferee
  

These visas do not automatically allow you to start or run a business. However, you can apply for permission to engage in secondary business activities if your employer allows it, or better yet, switch to a more appropriate visa, such as the Business Manager Visa.

Business Manager Visa: The Most Reliable Path to Entrepreneurship

The Business Manager Visa / Keiei Kanri Visa) is the primary visa category that permits foreigners to start, operate, and manage businesses in Japan. It’s intended for individuals who will play an active role in managing a business, not merely investing money.

Eligibility Requirements for the Business Manager Visa

To qualify for this visa, the Japanese government requires you to establish a legitimate business presence with proper capital, staffing, and operational planning. Here’s a breakdown:

1. Physical Office in Japan

• A real, physical office is mandatory—virtual offices or co-working spaces are not accepted by immigration officials.
  
• You must submit a commercial lease agreement, not a residential one, with a business address that matches your registration documents.
  

2. Hire Two Full-Time Employees OR Invest 5 Million Yen

You have two options:

• Hire at least two full-time employees (Japanese nationals or permanent residents),
• Invest at least ¥5 million JPY (approximately $31,000 USD) into the business.
  

Note: Hiring part-timers or contractors doesn’t fulfill this requirement. Employees must be properly enrolled in social insurance and labor systems.

3. Prepare a Detailed and Realistic Business Plan

A well-written, professional business plan is critical. It must include:

• Company overview and goals
  
• Services/products offered
  
• Market research and competitive analysis
  
• Marketing strategy
  
• Financial forecasts for 3–5 years
  
• Hiring plans and operational structure
  

This plan is submitted along with your visa application and reviewed carefully.

4. Establish a Legal Entity (GK or KK)

You need to legally register your company before applying for the Business Manager Visa. Most entrepreneurs choose either:

• Godo Kaisha (GK): Similar to an LLC; easier and cheaper to set up
  
• Kabushiki Kaisha (KK): Equivalent to a corporation; more prestigious but more complex

Types of Business You Can Start on This Visa

Once approved, your Business Manager Visa allows you to run any legitimate business, such as:

• Restaurants or cafes
  
• Import/export businesses
  
• Consulting firms
  
• Tech startups
  
• Language schools
  
• E-commerce companies
  

However, each business type must be clearly stated in your application. Immigration officers will expect you to prove feasibility, especially if your plan includes hiring.

Can You Freelance or Work as a Sole Proprietor?

If you’re not ready to start a full-fledged company, you can consider becoming a sole proprietor (kojin jigyo / a common route for freelancers, language teachers, translators, and digital nomads.

Important: Visa Compatibility

You must already hold a visa type that allows self-employment, such as:

• Spouse or Dependent Visa (with work permission)
• Permanent Resident Visa
• Highly Skilled Professional Visa
• Designated Activities Visa (for certain entrepreneurship programs)
  

Work visas like “Engineer” or “Instructor” do not permit freelancing unless you obtain separate permission from immigration.

Steps to Register as a Sole Proprietor in Japan

Becoming a sole proprietor is relatively simple. Here’s how:

• Confirm Visa Status – Make sure your visa allows business activity.
  
• File “Notification of Business Opening” – Submit this to your local tax office (zeimusho).
  
• Apply for a Blue Form Tax Return – Optional but recommended; it provides tax benefits if you maintain proper bookkeeping.
  
• Open a Business Bank Account – Most Japanese banks require resident status and sometimes a business address.
  
• Keep Accurate Records – Track invoices, receipts, and expenses carefully for taxes.
  

You can run your business from home, but it’s recommended to have a dedicated workspace.

Additional Option: Side Business While on a Work Visa

If you’re not ready to switch visas, you may apply for:

Permission to Engage in Activity Other Than That Permitted by the Current Visa

This lets you conduct a side business while still being employed full-time. You’ll need:

• Written permission from your employer
  
• Business plan or outline of activity
  
• Application form and fee (available at immigration offices)
  

However, this permission is limited—you can’t hire staff or manage large operations. It’s meant for small-scale, low-risk side hustles.

Step-by-Step: How to Set Up a Company in Japan

If you’re going the Business Manager Visa route, here’s a complete breakdown:

You’ll also need to appoint a representative director who resides in Japan.

Support for Foreign Entrepreneurs in Japan

There are several government and private-sector programs offering guidance:

• JETRO (Japan External Trade Organization): Free consultation, business setup help, and startup guides
  
• Tokyo One-Stop Business Establishment Center: English-language services for company registration, visa help, and taxes
  
• Local City Halls and Prefectures: Many offer “Startup Visa” programs for foreign entrepreneurs.

Legal and Practical Considerations

• Taxation: As a business owner, you’ll be liable for corporate tax, consumption tax, and local taxes.
  
• Insurance: You must register for employee health insurance and pension contributions if you have staff.
  
• Language: All legal documents are in Japanese. Hiring a judicial scrivener or lawyer is highly recommended.

Start Small, Plan Big

Japan is business-friendly but procedurally strict. If you’re serious about building a long-term business here, the Business Manager Visa is the most sustainable option. For low-cost ventures or freelance work, sole proprietorship is a great start—as long as your visa allows it.

Whatever path you choose, be proactive:

• Get legal advice
•  Follow all immigration rules
•  Prepare proper documentation
•  Focus on long-term value

Starting a business in Japan isn’t just a legal process—it’s a cultural one. With the right strategy and support, it can also be one of the most rewarding decisions you make in your entrepreneurial journey.