A business start-up as a sole trader

Japanese business start-up consultant

I used to work as an adviser at Tokyo One-Stop Business Establishment Center. Many foreign nationals came to seek legal advice on how to set up a company in Japan, especially in Tokyo.

 

Setting up a company is an option to do business, but working as a sole trader is another option. A sole trader is a business that is owned and run by one person. There is only one owner, but they may have employees who work for them. Sole traders are usually start-ups or small businesses. Sole traders have unlimited liability and the owner is personally responsible for the debts of the business. A sole trader pays income tax on their earnings.

 

A sole trader calculates the amount of income earned during the year from 1st January to 31st December of each year and the amount of income tax, and must file a tax application form at a tax office between 16th February and 15th March of the following year.

 

It has the risk of unlimited liability and there is a high level of responsibility for the business owner, but it is quick and easy to set up and has low set-up costs.

I hope the information is useful.

I will update every Monday.

For more information

Japanese business consultant

Shihoshoshi Lawyer

(Judicial Scrivener)

Akiko HORI

https://lawhelp4u.com/english/legal-advice-for-business-in-japan/

 

 

Please keep “Information for registration identification” (登記識別情報) safe.

Japanese business start-up consultant

Occasionally, people who cannot find their “Information for registration identification” are asking how they restore the document.

Information for registration identification is an important document that proves you have the ownership of the real property.
Unfortunately, it is not reissued at the Legal Affairs Bureau.

If there is a risk of theft, there is a procedure of invalidating the PIN code to let the Legal Affairs Bureau know.
However, even after invalidating the PIN code, Information for registration identification is not reissued. That is the system of Japan.

If the document are not found, strict identity verification is required when selling the real property, and the lawyer in charge of the sale will handle it to prove your identity, which normally incur an additional cost. The amount of the cost depends on the lawyer.

One of the best ways to store documents is at home in a safe or file box. If you don’t know which one is an important document, asking in person is the best thing to do.

I hope the information is useful.
I will update every Monday.
For more information
Japanese business start-up consultant
Shihoshoshi Lawyer
(Judicial Scrivener)
Akiko HORI

https://lawhelp4u.com/propertyJapan/

The process of buying real property in Japan

Japanese business start-up consultant

Step 1.
The intending seller appoints a real estate agent and the intending purchaser looks for a suitable property through an agent. The real estate agent can either act for both seller and buyer or just the seller.

 

Step 2.
Once the buyer finds a suitable property, they conduct their own due diligence, including whether the price is fair. The intending purchaser (or agent) sends a Letter of Intent as part of the negotiation of price. This is not legally binding.

I provide consulting services for the purchase and sales of real property in Japan.

I research the registration of both company and property on the official record basis, and report it in English. When required, I research the recent property record from the website below.

Public transaction record is available in English.
https://www.land.mlit.go.jp/webland_english/servlet/MainServlet

 

Step 3.
Once the price and any other conditions are agreed, a Real Estate Purchase and Sales Agreement and an Important Disclosure Statement for the property will be prepared by the seller. Broadly speaking, the parties are free to draw up a contract in any form they choose. The buyer should arrange to have the deposit 10% of the purchase price ready for when the contract is signed.

 

Step 4.
The buyer and seller (or authorised agents) sign the contract, which will specify a date for settlement of the balance of payment. The Important Disclosure Statement will be provided either at this time or some time before settlement.

 

Step 5.
On the Settlement date, the impartial Shihoshoshi lawyer deals with the property rights transfer and the outstanding balance of the purchase price (and any costs) is settled. The seller will also hand over various original documents related to the property. It is also possible for the buyer to appoint their own lawyer

I make sure that the transfer of real property on agreed terms is carried out correctly.

I hope the information is useful.
I will update every Monday.

For more information
Japanese business start-up consultant
Shihoshoshi Lawyer
(Judicial Scrivener)

https://lawhelp4u.com/propertyJapan/

Estate and Succession planning – 1-7. Making a will Part 2

Japanese business start-up consultant

3. Jurisdiction and applicable law in Succession

 

In Japan, the article 37 of the Act on General Rules for Application of Laws is applied for wills and succession. Article 37 states that the formation and effect of a will shall be governed by the national law of a testator at the time of the formation. Concerning this provision, ‘the formation and effect of a will’ means only matters concerning the transmission of wills, such as the mental capacity, defective evidence of intention, effect of a will or validity of a will. When the will comes into effect at the time of death, the contents of the will, including maintenance obligations arising by reason of death is determined by article 36 of the same law.

Under the Act on the Law Applicable to the Form of Wills, both the governing law of the will (article 37) and the inheritance (article 36) are stated to be the national law, but there is a time gap between the will at the time it was established and the inheritance. If the nationality of the person is different between the time of making the will and at the time of death, the governing law might be different. To avoid the confusion, as a practical matter, a testator can choose which law governs succession to their estate.
In addition, when acknowledging a child or putting an estate in the trust under a will, article 29 (Formation of Parent-Child Relationship with Child Born Out of Wedlock) or article 7 (Choice of Governing Law by the Parties) of the same law is applicable.

As well as the Act on General Rules for Application of Laws, there is the Act on the Law Applicable to the Form of Wills, which was created by ratifying the Convention of The Hague Conference on Private International Law in 1961.
Under the Act on the Law Applicable to the Form of Wills, a formally prepared will becomes valid as long as it complies with the law of the place where the will is established, of the country where the testator has nationality, of the place where the testator had domicile, of the place where the testator had habitual residence or the law of the place where the real property is located.

 

4. Advice

This selective listing of a large number of laws in the Act on the Law Applicable to the Form of Wills allows a statutory will as far as possible, and most wills made under the law of the place where the testator resides will become valid in most of cases. However, in practice, a will which follows the methods of Japanese law is prepared separately in many cases in order to carry out the post-death administrative procedures for Japanese estate smoothly.
It is possible for an individual to make a will for themselves, but that is not without its risks. There might be technical issues that potentially could go wrong. If there are any errors, these could cause problems after the death. I can advise on arrangements for a will, and highlight potential problems that might arise.

I hope the information is useful.

I will update every Monday.

For more information

Japanese business start-up consultant 

Shihoshoshi Lawyer

(Judicial Scrivener)

http://lawhelp4u.com/advice/

http://lawhelp4u.com/propertyJapan/

Estate and Succession planning – 1-7. Making a will Part 1

Japanese business start-up consultant

1. Historical Background

In Japan, since the Middle Ages, the custom was not only for the firstborn legitimate son to inherit most of his parent’s estate, which was generally the case, but also for the eldest girl or youngest son to succeed to and maintain the family business, such as farm fields or business rights.

In the modern era, when an estate was considered as the sum of a person’s assets, the inheritance process was regarded as one of the division of an estate between a small range of close relatives, such as a person’s spouse and their children or parents. Therefore, the principle is that the sum of a person’s assets is distributed equally to the heirs of a certain rank.

As in France and Germany, the Japanese laws have definite rules on who will receive most of a deceased person’s estate, whether there is a will or none, but there is the freedom of making a will.
In addition, there is a system of legally secured portions for certain legal heirs in order to harmonise the legal inheritance rules and the freedom of making a will.

 

2. Legal heirs and the inheritance process under the Japanese law

In Japan, a deceased person’s legitimate surviving spouse will always be their heir, but will only be their sole heir if there are no legal heirs in the first, second or third ranks. Legal heirs in the first rank are the children, lineal ascendants (parents, grandparents, etc.) are in the second rank, and the deceased person’s legal siblings are in the third rank. Heirs of the second rank only inherit if there are no heirs of the first rank, those of the third rank only if there are none of the first two ranks.

If there are several people in the same rank, their portion will be divided equally among all those in the same rank. There is no legal distinction between a biological child or an adopted child or by gender, and even if they become married or adopted, they will still be heirs.

If a deceased person’s child dies before them, and if the child has a child (a grandchild for the deceased person), the grandchild is entitled to inherit and will have the same rank as a living child of the deceased person. Furthermore, if the grandchild also dies before the deceased person, and if the grandchild leaves their child (a great-grandchild for the deceased person), the great-grandchild will be one of the deceased person’s heirs. If the deceased child has several children, they share what would have been their parent’s share equally, and the same principle applies to the children of a deceased grandchild.

If there is no child at all, a deceased person’s lineal ascendant (parents, grandparents, etc.) as the second rank becomes the heir. Amongst lineal ascendants, the heirs will be close relatives (parents will be heirs if there are parents and grandparents). If there are biological parents and adoptive parents, both can be heirs as the same rank.

If there is no lineal ascendant, legal siblings become the heirs as the third rank. Legal siblings mean children who have shared at least one parent in common either by blood or adoption. However, if the legal siblings have shared only one parent in common, their share in the inheritance is one half of the share of a sibling who shares both parents. In addition, in this case, if the siblings who are supposed to be the deceased person’s heirs die before the deceased person, only their child (the deceased person’s nephew and niece) can succeed the third rank of heirs, and not the nephew’s or niece’s child.

If it is not clear who is a deceased person’s heir, the family court will conduct a legal procedure. Under this procedure, an executor for the succession who is appointed by a family court, and will search for the deceased person’s heirs under the family court’s supervision, and deal with matters of succession. If no heirs can be found, the deceased person’s estate may be distributed to those who have physically lived together with the deceased person, such as de facto partner or children, or the family court may consider special circumstances respectively. If there is still any remaining estate, it will become national assets.

An estate consists of various assets such as money, land, movables and loan claims, and the methods of division amongst their heirs is called the inheritance division. If the deceased person determines the method of this division by their will or entrusts their assets to a third party, the division will be followed by the method chosen. If there is no such determination, their joint heirs will decide the method. If no agreement amongst heirs is possible, a family court will be involved. The family court carries out the inheritance division in consideration of the type and nature of the estate, rights relating to the assets and any other circumstances.

To Be Continued.

I hope the information is useful.

I will update every Monday.

For more information
Japanese business start-up consultant
Shihoshoshi Lawyer
(Judicial Scrivener)
Akiko HORI

https://lawhelp4u.com/propertyJapan/

A Happy New Year in 2017

A fresh New Year has just started.

I always think every day has a fresh start to it so that I don’t very much care about the New Year but I like the Japanese proverb “Decisions made on New Year’s Day are the key to a successful year.”

What I think about on New Year’s Day is the past.
I wonder what my life would have been if I hadn’t become a lawyer.

Many people applaud me because I am smart but I only graduated from Junior College (only a two year course) and when I entered the Junior College, I had only taken the interview, not a test paper.
When I was a high school student, I hated calculation and I only studied maths calculations, not written maths questions and passed just a little higher than the borderline.
Even when I become old enough, I failed the Financial Planner examination and I am still not good at multiplication.

All the time I was studying law, I strongly believed in myself, that I was good and I could make every effort to progress, and I inspired myself.

My confident idea is that:
Anybody can be discouraged.
Everybody has drawbacks.
Anybody can feel unhappy.
Nobody has any big differences from others.

When I use the words above, some people say I have anything and I look down ordinary people.
I feel a little sad when I hear something like that but I cannot blame them.
It is arrogant if I expect others to take account my thoughts.
All I can do is to look after myself and decide for myself.

It is more than enough if I am confident about my life and I do my best when making my decisions.

For more information
Shihoshoshi Lawyer Akiko HORI

Legal Advice for Business in Japan

How to Buy a property in Japan

Business structures in Japan – Branch office

Branch office

A branch office does not have a separate legal corporate status so claims and liabilities arising in the branch can be applied to the main company of which it is part.
It could open its own bank accounts or lease property in its own name but it will need to negotiate with a bank or landlord.

The registration details are below.
The address of the branch office, the representative in Japan, the date of branch office establishment, the accounting method used for balance sheets and details of the home company.