Japan

JP JPY¥ Japanese
Pros
Exceptional public safety and low crime rates protecting private property and personal security.
World-class infrastructure and reliable logistics networks for efficient business operations and connectivity.
High institutional transparency and minimal public sector corruption ensuring a predictable legal environment.
Cons
High corporate tax burdens and complex fiscal regulations limiting capital retention and reinvestment.
Rigid labor market regulations and bureaucratic hurdles hindering flexible employment and rapid scaling.
Stagnant domestic market growth due to severe demographic decline and aging population trends.

Long story short: Starting a company in Japan feels like an initiation rite of stamps and paperwork: you'll grind for weeks before you bill your first client.

The flip side: zero corruption, a rock-solid banking system, infrastructure that runs like clockwork, and crime that's basically a non-issue in Tokyo's wealthier districts.

A few more things worth knowing: corporate tax bites hard, the food is a genuine joy, the scenery is worth the trip, and locals stay polite but keep their distance.

VERYLOW TAX 4.2/10 HOLDING 6.1/10 DIVIDENDPIPELINE 4.6/10 CRYPTOHAVEN 2/10 PRIVACYGRADE 5.5/10

Will your income be taxed?

Long story short: YES, A LOT.
On paper, Japan shears you at up to 45%. In practice, the territorial regime only bites income sourced locally: foreign salary, foreign dividends, foreign gains walk through untouched. The sticker is there to scare; the machinery doesn't reach that far.

Earn your living abroad and the local taxman mostly waves at you from a distance.

01.1 Income tax
Personal income tax
5 → 45%
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De quoi s’agit-il ?What residents pay on what they earn: salary, freelance income, sometimes dividends too. We show the system (flat or progressive) and the top rate.
Source et informations complémentairesprogressive · 7 brackets
Bracket (USD)Rate
0 – 12,2405%
12,240 – 20,71410%
20,714 – 43,62520%
43,625 – 56,49323%
56,493 – 112,98633%
112,986 – 251,08040%
251,080 +45%
01.2 Tax residence test
A single active rule is enough to make you tax-resident.
183-day rule
does not exist here
Economic interest
does not exist here
Family centre
does not exist here
Habitual abode
Extended-stay test
does not exist here
Income tax simulatori

If you earn a year, you will pay .

Roughly effective, with a marginal rate of .

+2.1%
national income tax

Will your wealth be taxed?

Long story short: YES, FAIRLY.
Capital gains in Japan cost 20.3% on disposal, with no annual wealth levy. But inheritance comes back for seconds when assets pass down.

Same money, two tollbooths: the sale, then the succession.

02.1 Investment income
Capital gains
20.3%
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De quoi s’agit-il ?The tax on your profit when you sell something that gained value: stocks, property, crypto, a business. Some countries skip it entirely.
Source et informations complémentairesprogressive · +9% short-term capital gains on real property held for five years or less
Dividend tax
45%
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De quoi s’agit-il ?What you pay when your company sends you dividends. It stacks on top of corporate tax, so the combined bill is what really counts.
Source et informations complémentairesprogressive · +2.1% applied to national income tax
Bracket (USD)Rate
0 – 12,2405%
12,240 – 20,71410%
20,714 – 43,62520%
43,625 – 56,49323%
56,493 – 112,98633%
112,986 – 251,08040%
251,080 +45%
Interest income
45%
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De quoi s’agit-il ?The tax on income from savings, bonds and loans. Matters when choosing where to park your cash.
Source et informations complémentairesprogressive
Bracket (USD)Rate
0 – 12,2405%
12,240 – 20,71410%
20,714 – 43,62520%
43,625 – 56,49323%
56,493 – 112,98633%
112,986 – 251,08040%
251,080 +45%
02.2 Wealth & estate
Wealth tax
NONE
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De quoi s’agit-il ?A yearly tax on what you own above a threshold, whether you sell or not. Most countries scrapped it; a few still run one.
Source et informations complémentairesno annual wealth tax · no real-estate wealth tax · no net-worth assessment
Inheritance system
APPLIES
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De quoi s’agit-il ?What heirs pay on what they inherit, by category (spouse, children, others), with allowances and top rates. Plenty of countries charge nothing at all.
Source et informations complémentairesheir-based · 5 heir classes
HeirTop rateAllowance
Spouse55%JPY 160,000,000
Children55%
Siblings55%
Other relatives55%
Non-relatives55%
02.3 Crypto
Crypto · tax regime
PROGRESSIVE
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De quoi s’agit-il ?How crypto gains are taxed here: zero, flat, progressive or grey zone. Includes whether crypto-to-crypto swaps count as taxable events.
Source et informations complémentairesRate: 55% · Crypto gains are classified as Miscellaneous Income (Zatsu-shotoku) and taxed at progressive national rates (5% to 45%) plus a flat 10% local inhabitant tax, reaching a maximum of 55%. Swapping one cryptocurrency for another is a taxable event. Salaried employees with total miscellaneous income under 200,000 JPY are generally exempt from filing a national tax return, though inhabitant tax may still apply. A major tax reform proposing a 20% flat tax for specified crypto assets is currently under discussion for 2026.
Crypto-to-crypto
TAXABLE
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De quoi s’agit-il ?How crypto gains are taxed here: zero, flat, progressive or grey zone. Includes whether crypto-to-crypto swaps count as taxable events.
Source et informations complémentaireseach swap counts as a disposal — gains realised at every trade
FATF travel rule
SIGNED
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De quoi s’agit-il ?Does this country enforce the crypto Travel Rule? If yes, exchanges must identify senders and recipients, like banks do for wire transfers.
Source et informations complémentairescommitted but not yet enforced

Easy to run a company there?

Long story short: YES, BUT TAXED.
Corporate tax in Japan lands at a moderate 19%, no IP-box to soften it. Standard accounting, VAT at 10, the usual dose of paperwork. Nothing to celebrate, nothing to flee.

03.1 Rates
Corporate tax
19%
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De quoi s’agit-il ?What companies pay on their profits. The headline rate is a starting point: IP boxes and holding regimes often pull the real rate lower.
Source et informations complémentairesprogressive · +10.3% National local corporate tax applied to corporate tax liability
Bracket (USD)Rate
0 – 50,21619%
50,216 +19%
VAT standard rate
10%
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De quoi s’agit-il ?The sales tax baked into almost everything you buy here. One standard rate, plus reduced rates on things like food or books.
Source et informations complémentaires2 distinct tiers in force
8%10%
Food & drink
8%
food
8%
non-alcoholic
10%
alcohol
Print media
10%
books
10%
ebooks
8%
newspapers
Hospitality
10%
restaurants
8%
takeaway
Digital & telecom
10%
digital
03.2 Regime & registry
IP Box · Patent Box
NONE
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De quoi s’agit-il ?A discounted tax rate on income from patents, software and designs, often 5 to 10%. A magnet for tech and licensing businesses.
Source et informations complémentairesno IP regime · IP income taxed under standard corporate rules
Misuse of corporate assets
CRIMINAL
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De quoi s’agit-il ?If you spend company money on yourself, is it a crime (prison possible) or a civil matter? Some countries prosecute even sole shareholders.
Source et informations complémentairescriminal liability · Companies Act Art. 960 (Special Breach of Trust) and Penal Code Art. 253 (Professional Embezzlement) · Japan strictly adheres to the 'Autonomy of the Legal Entity' principle. Under established Supreme Court precedents (e.g., June 26, 1970, and November 9, 2006), a sole shareholder-director can be held criminally liable for misappropriating company funds. The law considers the corporation's assets to be legally distinct from the individual's personal property; therefore, the 'consent' of the sole shareholder does not negate the breach of duty to the company or the criminal nature of the act, regardless of the company's current solvency.
Shareholders privacy
PRIVATE
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De quoi s’agit-il ?How visible a company's shareholders and directors are: free public registry, paywalled, restricted or fully private. More privacy, but sometimes warier banks.
Source et informations complémentairesCommercial Register (Shogyo Tokibo)
Directors privacy
PUBLIC PAYWALL
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De quoi s’agit-il ?How visible a company's shareholders and directors are: free public registry, paywalled, restricted or fully private. More privacy, but sometimes warier banks.
Source et informations complémentairesCommercial Register (Shogyo Tokibo)
03.3 Incorporation cost
In this country, the most standard company form is called 株式会社 (Kabushiki Kaisha (Joint Stock Company)). The costs below are for incorporating a company in its simplest form, for reference only.
Registration License Tax (Minimum)
USD 942
Notary Public Fee (Articles of Incorporation)
USD 314
Professional Incorporation Service (Judicial Scrivener)
USD 1,569
Corporate Seal Set and Registry Certificates
USD 188
Total
USD 3,013

A good fit for a holding?

Long story short: NOT REALLY.
Japan brings an extensive treaty network (77 agreements) and a participation-exemption regime, but the exemption stops at 95%, so 5% of qualifying dividends still gets taxed at the corporate rate (19%).

For a holding, that residual slice is a slow leak in the hull: every distribution drips a few points overboard.

Decent, not elite. The treaties do the heavy lifting; the regime doesn't quite finish the job.

04.1 Substance & exemptions
Territorial · individuals
REMITTANCE
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De quoi s’agit-il ?Does this country tax only local income (territorial) or everything you earn worldwide? Territorial means your foreign income stays untaxed here. Huge.
Source et informations complémentairesremittance basis — foreign income taxed only when brought in
Territorial · corporates
WORLDWIDE
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Source et informations complémentairesworldwide corporate taxation
Participation exemption
95%
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De quoi s’agit-il ?Can a holding company receive dividends from its subsidiaries tax-free? The cornerstone of any serious holding structure.
Source et informations complémentaires25% holding · 6 months min
CFC rules
APPLY
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De quoi s’agit-il ?Anti-offshore rules: they tax you at home on your foreign company's profits, even if nothing was distributed. Where they exist, offshore setups get tricky.
Source et informations complémentairesUndistributed earnings of a foreign subsidiary are included in the Japanese parent's taxable income if the subsidiary is controlled by Japanese entities and meets specific criteria regarding its business activity, substance, or the nature of its income, particularly when the foreign tax rate falls below defined thresholds.
04.2 Withholding tax · non-resident
WHT · dividends
20%
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De quoi s’agit-il ?The cut this country takes when it sends dividends, interest or royalties abroad. Tax treaties can shrink it; blacklists can inflate it.
Source et informations complémentairesnon-resident outbound
WHT · interest
20%
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Source et informations complémentairesnon-resident outbound
WHT · royalties
20%
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Source et informations complémentairesnon-resident outbound
Tax-haven WHT
NONE
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Source et informations complémentairesno punitive rate on record
04.3 Treaty network
Treaties signed
74
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De quoi s’agit-il ?Deals with other countries to avoid double taxation and cut withholding taxes. The bigger the network, the easier your money moves across borders.
Source et informations complémentairesactive
Treaties pending
1
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Source et informations complémentairesin negotiation
Tax treaty network
origin · JP 0% > 0% no treaty
Inspect a country
Hover any country on the map to read its withholding-tax treaty with JP.
Country Status Dividends Interest Royalties
// no treaties match

Easy to come and go?

Long story short: LITTLE.
Coming and going from Japan costs you nothing worth mentioning. Territorial regime (foreign income stays foreign), no exit tax at the door.

You show up with your stuff, you leave with your stuff, plus whatever you earned abroad in between. Borders the way they should all work.

05.1 Exit & dual nationality
Exit tax
NONE
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De quoi s’agit-il ?What the country charges you for leaving: tax on your unrealized gains, as if you'd sold everything at the border. Here you'll see if it exists and when it triggers.
Source et informations complémentairesno triggers active · residence change tax-free · no deemed-disposal mechanism
Dual citizenship
FORBIDDEN
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Source et informations complémentairesnaturalisation requires renouncing existing citizenship
05.2 Citizenship paths
Residence
5 years
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Source et informations complémentairesavailable path to naturalisation
Marriage
3 years
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Source et informations complémentairesavailable path to naturalisation
Birth
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Source et informations complémentairesnot available
Descent
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Source et informations complémentairesnot available
Investment
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Source et informations complémentairesnot available

Is your money watched?

Long story short: YES, CLOSELY.
Yes, your money is watched here. Japan signed every major automatic-exchange framework: CRS, FATCA, CARF, MLI, MAAC. Open an account and it gets reported straight to your home tax authority (Americans: FATCA applies, no exceptions).

Corporate registries stay non-public, which saves a thin slice of ownership discretion. But your financial trail is made of glass.

Multilateral reporting frameworks 4/9 active · 4 pending
CRS
2018
CARF
2024
FATCA
2014
MLI
2018
BEPS
MAAC
2013
GLOBAL FORUM
EOIR
CRYPTO TRAVEL RULE

Is it blacklisted?

Long story short: NO.
Japan is clean on every major blacklist (FATF, EU, France, Spain, Portugal, Brazil) and sits inside the FATF club.

Wiring money to or from here raises zero eyebrows: no flags, no extra questions, no compliance officer waking up. Reputationally, a non-event.

Blacklist exposure Clear everywhere
EMBARGO
un / us / eu sanctions
FATF
grey / black list
EU
non-cooperative list
FRANCE
ETNC list
SPAIN
tax-haven list
PORTUGAL
favourable regimes
BRAZIL
low-tax list

Do you feel free there?

Long story short: PARTLY.
Japan sits in the middle band of the RSF press-freedom index (rank #66): civil society functions, but the walls are real and you'll learn fast where they stand.

Crypto lives in the standard regulated tier.

08.1 Press freedom
Press freedom · RSF index
66/180
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De quoi s’agit-il ?The RSF world ranking of press freedom. A good proxy for censorship and civil liberties. The lower the rank, the freer the press.
Source et informations complémentairesscore 63 · ↑ 4 ranks year-on-year
Central bank digital currencyi
Program Status Cross-border Sources
Digital Yen
The upcoming program is an end-stage trial with an eye towards implementation. BOJ will work with private-sector banks to test deposits and withdrawals from accounts, and check whether the currency can work without internet access in emergency scenarios.
Bank of Japan
PROOF OF CONCEPT
Stella
It explores the opportunity for DLT to improve financial market infrastructure to support payment and securities settlement.
Bank of Japan
RESEARCH

Connected to the world?

Long story short: EXCELLENT.
Japan is wired straight into the global money grid: 9/11 of the services we track work here.

Stripe onboards you, so you can charge cards from a laptop the day you land. Amazon delivers to your door like it would in Paris or Berlin. Wise, Revolut, PayPal: pick your rails, they all run.

Accept payments 4/6 available
Stripe
card payments
PayPal
wallet payments
Adyen
enterprise psp
Mollie
eu payments
GoCardless
direct debit
Paddle
merchant of record
Bank and move money 3/3 available
Wise
multi-currency
Revolut
personal banking
Revolut Business
business banking
Buy and sell on Amazon 2/2 available
Amazon
consumer delivery
Amazon Seller
marketplace selling
SEE ALSO

Other jurisdictions worth comparing

Picked by similarity of strategic profile to Japan. No editorial ranking — neighbours in the same scoring space.

PROFILE-ADJACENT Same shape, comparable overall friction.
NOTABLY MORE FAVORABLE Same family of strategies, higher total score.
NOTABLY LESS FAVORABLE Same family of strategies, lower total score.