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Self employment as a Developer in Japan


#1

I am writing to ask a question about working as a developer in Japan.

I have read your blog but am still unsure of what to do in my situation, and so,
if you could find some time to answer my question I would be most grateful.

I am a JavaScript/PHP/Node developer from the UK and am married with a Japanese woman.

We will be moving to Japan (Aichi most likely) to settle some time next year and so I’m looking for information about my job situation.
I currently work for a company here in the south of England and my boss has said that even if I go to Japan to settle
he wants to continue to hire me.

However I would not be a normal company employee.
He would like to hire me as essentially a contractor.

My question is, if I do this do I have to register as being self employed somehow in Japan?
Or do I just start work when I get my spouse visa and simply file tax returns when required?
Or do I need to set my self up as a company?

This may be a simple question to ask, but after looking around on Google for the past few weeks, I am still unsure as
to what I need to do in Japan to legally work as a contractor for my current employer who is based in England (once I have my spouse visa of course).

Any advice you could give on this subject would be greatly appreciated.


#2

The biggest hurdle to self-employment in Japan is the visa, so since you’ll have a spouse visa, it should be pretty straightforward to be self-employed here.

Japan allows self-employment, so you won’t need to set up a company.

I’m not entirely sure if you need to register as a sole-proprietor or not. I did find an form called 個人事業開始申告書 which is implying there is some sort of registration procedure which you need to submit at your local tax office. Japanese bureaucrats are generally pretty friendly, so the simplest thing to do would be to drop by with your wife once you get here.

The other thing I’d suggest is to find an accountant. Though there is no legal requirement to having an accountant, having one will save you money. Japan tends to be very generous in what you can deduct as a business expense, but at the same time it leaves a lot of room to interpretation into what is a valid expense. Having a professional who can make suggestions about what to deduct should save you money.


#3

Thank you for the advice.

So basically when I am in Japan and have applied for / received my spouse visa I should just go to the local 税務署 and ask what I have to do?

Or would it be best to ask at the 市役所?

Lastly, do you have any advice on how to find a good accountant in Japan?


#4

I guess your wife will need to go to the 市役所 to register as a resident when you get there, so I’d just ask about the procedure then. It should be a pretty straightforward procedure, so I wouldn’t worry too much about it.

For finding an accountant, I’d start by just googling for local ones, and set up a consultation. If you get a good impression of any of them, that’s probably enough as your accounting needs should be pretty straightforward.


#5

Ok, thank you for your time.

When I get over there I will have to remember to write down exactly what I do.


#6

One of my friends on Facebook posted some comments on this:

  1. You can simply do business under your name but be sure to take a 領収書 under that name to count it as a business expense.
  2. You can register a “trade name” to go by; basically like a company name. It’s called a 商号 and you can register at at any 税務 office for a trivial fee.
  3. Look into applying for an 青色申請書, when you report on your taxes it makes the whole thing a little easier and a little cheaper.
  4. You won’t be eligible for any sort of employment insurance or unemployment benefits - but you should never consider utilizing those anyway as that will negatively impact your chances of getting an 永住権 or citizenship if you so choose.
  5. This goes with #1 in a way but you MUST issue 領収書 if a customer makes a payment on a quote or in cash. If they make a payment to a bank account from a 請求書 you do not need to issue a 領収書 and if you do you must make a note of the transaction and the 請求証 on the 領収書 or it will look like the customer payed double.
  6. Get an accountant. Everything is pretty easy to do yourself but an accountant works magic. If you can, and I suggest you try to, get an accountant who will have coffee with you on a regular basis to exchange paperwork. There are a lot of accountants like this and these guys will give you good advice and often introduce you to new customers.

#7

Thanks for the extra information.

So basically it seems that after filling out a few simple forms I could start working right away without any real trouble, but to save money and make things easier, an accountant and a few more extra forms would make a big difference.

I will pretty much be working for one company in the UK (at least in the beginning) so all I will be doing is sending them invoices (請求書) and they will be transferring money into my bank account, so it looks like I may not have to worry too much about the 領収書 too much, but perhaps it would be best if I just do it anyway to make sure all my bases are covered.

I didn’t know about employment insurance and unemployment benefits negatively affecting an application for 永住権, although thinking about it now I suppose it’s pretty obvious.
I wouldn’t try to make use of those things anyway but it’s nice to know this stuff if I plan on applying for 永住権 later on.

I do have a question about #2 though.
Is there any benefit to registering a 商号 over trading under my own name?


#8

As long as you are sending your customer invoices, you don’t need to send 領収書 (I never had).

For registering a trade name, the only advantage I know of is you can open a bank account in that name. This is useful if you are running a business such as a shop where you want to differentiate your “trade” identity from your personal one. As someone contracting for a single company though, I don’t see any advantage of it.


#9

Does the situation change much if you have an engineer visa instead of a spousal one? Does it make a difference if your contracts are with companies inside or outside of the country?

I noticed Paul said this in another post:

On Patrick’s recent post he mentioned that after switching to self employment the fact that one of his contracts was with a Japanese company may have been helpful.

My hack around this, after quitting the day job, was to describe myself as an engineering consultant. I presented the immigration office with a stack of invoices and tax returns demonstrating that I made a stable living in software. (Much of it was from selling software, the key bit from their perspective was that at least one of my contracts had a Japanese company as a party to it.) After a bit of wrangling, they approved me to continue doing what I was already doing. (Word to the wise: this trick for self-sponsorship doesn’t technically speaking allow one to “run a company”, so I would avoid doing things which make it undeniable that one is in fact doing that, like e.g. hiring full-time Japanese employees.)

I realize no one here is a lawyer, and I’ll keep that in mind, but if you have any experience with this, I’d love to hear about it. Thanks.


#10

If you already have an engineering visa, going to self-employment is pretty straightforward. As far as I understand, immigration only re-evaluates your situation when you go to renew your visa. So ideally you want a good amount of time left on your engineering visa when you become self-employed. That way, you can build up a record of you getting paid for doing contract work by paying income tax. As long as you can pay yourself a living wage in Japan (~ 300,000 JPY per month), you should be fine.

If you become self-employed and are looking to renew your visa before you’ve built up a record of being paid for contracting work, things might become a bit trickier. As I understand it, this is where showing a record of having contracts with Japanese customers can help.

Unless you have a spousal visa, if you are self employed, I would suggest always using a professional to renew it. When using a professional, you don’t need to go to immigration yourself and convince them what your doing is legal, which sounds both challenging and stressful to me. Besides which, dealing immigration just takes time - time that is better spent as someone who is self-employed in improving your business - so to me it is natural you should outsource it.


#11

These are really helpful! And thanks for the advices on renewing engineer visa and hiring professional for it.