Incorporating a Company Abroad: Singapore, US, Hong Kong & UK

Founders leaving Japan often move their business into a company in Singapore, the US, Hong Kong or the UK. The choice affects formation cost, officer rules, banking and founder visas and, while you remain tax resident in Japan, whether Japan taxes the company’s profits as your own under its CFC rules (Gaikoku Kogaisha Gassan Zeisei 外国子会社合算税制). This guide compares the four jurisdictions and explains the Japanese tax and wind-down steps.

Strategic Objectives for Setting Up an Entity Abroad

Common Reasons: Client Location, Currency, Investors, and Residency

Founders usually incorporate abroad for practical reasons: invoicing clients in their own market and currency, holding intellectual property in one entity, issuing shares to investors, or qualifying for a founder visa. Each of the four jurisdictions has a residence route tied to owning or running a company.¹²³⁴⁵ A foreign company is not a tax saving by itself.

The Core Rule: Where You Live Decides How the Profits Are Taxed

Article 40-4 of the Act on Special Measures Concerning Taxation (Sozei Tokubetsu Sochi Ho 租税特別措置法, STMA) applies to residents (Kyojusha 居住者) of Japan who meet its holding tests; non-residents are not among the persons it lists.⁶ Whether you are a resident caught by the rule is judged at the end of the foreign company’s fiscal year (Cabinet Order Article 25-24(1)).⁷ While you live in Japan, a low-taxed company you control can have its profits added to your income even if it pays you nothing.

After you become a non-resident, company fiscal years that end later no longer find you among the residents Article 40-4 lists, but Japan still taxes your Japan-source income and your destination applies its own rules. No NTA guidance was located on a move between the company’s fiscal year end and the inclusion date four months later, so ask a Zeirishi (税理士, certified tax accountant) before fixing your departure date and the company’s year end. When you become a non-resident is covered in the guide on Japan tax residency rules.

Who This Guide Is For (and Not For)

This guide is for owner-managed businesses: sole proprietors (Kojin Jigyo-nushi 個人事業主) such as consultants and freelancers, software founders, and owners of a small Kabushiki Kaisha (株式会社, KK) or Godo Kaisha (合同会社, GK). It applies to Japanese citizens and foreign residents alike, because the CFC rule follows tax residence, not nationality.⁶ Multinational groups and transfer pricing are out of scope.

Top Jurisdictions Compared: Singapore, US Delaware/Wyoming, Hong Kong, and the UK

Singapore Private Limited Company (Pte Ltd)

The Accounting and Corporate Regulatory Authority (ACRA) charges S$15 to apply for a company name, S$300 to register a local company and S$60 to file each annual return (as of October 2026).⁸ Only the person who reserved the name, who must also be appointed director or secretary, can register through Bizfile with Singpass; otherwise a corporate service provider registers for the founder.⁹

Officers and address: every company needs at least one director aged 18 or over who is ordinarily resident in Singapore (citizens, permanent residents or others meeting local residency rules); pass holders should check with their pass issuer before becoming a director.¹⁰ The company secretary must be a resident natural person who is not the sole director, appointed within six months of registration.¹⁰ The registered office must be in Singapore.⁹

Tax: IRAS charges corporate income tax at a flat 17%, with a partial exemption (75% of the first S$10,000 and 50% of the next S$190,000 of chargeable income) and, for the first three years of assessment, a start-up exemption (75% of the first S$100,000 and 50% of the next S$100,000) (as of October 2026).¹¹ The start-up exemption requires Singapore tax residence, which IRAS decides by where the business is controlled and managed, usually where strategic decisions are made.¹¹¹² A company whose decisions are all made by a founder in Japan may struggle to show it.¹²

United States: Delaware or Wyoming LLC vs C-Corporation

A Delaware LLC pays an annual tax of US$400, as published by the Division of Corporations, due by 1 June for the prior year, with a US$200 late penalty plus 1.5% monthly interest (as of October 2026).¹³ House Bill 400 raised it from US$300.¹⁴ Delaware corporations instead file an annual report and pay franchise tax by 1 March: at least US$175 (Authorized Shares Method) or US$400 (Assumed Par Value Capital Method), plus a US$50 report fee (as of October 2026).¹⁵

Wyoming charges US$100 to file LLC Articles of Organization and an annual report license tax of US$60 or two-tenths of one mill on the dollar of assets in Wyoming, whichever is greater (as of October 2026).¹⁶ The annual report is due on the first day of the anniversary month of formation, and the fee schedule lists reinstatement fees for companies with no registered agent.¹⁶¹⁷ Delaware’s formation fees were not confirmed on an official page for this guide, so check its fee schedule directly.

US federal tax: a C-Corporation pays federal income tax at a flat 21%; state taxes are not covered here (as of October 2026).¹⁸ A single-member LLC is disregarded as separate from its owner for US income tax unless it elects corporate treatment on Form 8832.¹⁹ A foreign-owned disregarded LLC must still file a pro forma Form 1120 with Form 5472 attached; failing to file Form 5472 or keep records carries a US$25,000 penalty, with more if the failure continues after IRS notice (as of October 2026).²⁰

Beneficial ownership reporting: FinCEN states that its final rule on beneficial ownership information (BOI) took effect on 14 August 2026 and that US companies are exempt (as of October 2026).²¹ Its earlier alerts limit reporting to certain entities formed under foreign law and registered to do business in a US state.²¹

Hong Kong Private Company Limited by Shares

The Companies Registry charges HK$1,545 (electronic) or HK$1,720 (hard copy) to incorporate a local company with share capital, and HK$105 for each annual return delivered within 42 days of the return date (as of October 2026).²² Business Registration is charged separately: a one-year certificate starting between 1 April 2026 and 31 March 2027 costs HK$2,200 plus a HK$150 levy, HK$2,350 in total (as of October 2026).²³

Officers: a private company needs a company secretary and at least one natural-person director, and a sole director cannot also be the secretary.²⁴ A director need not be a Hong Kong resident, but an individual secretary must ordinarily reside there (a corporate secretary needs a Hong Kong office), and the registered office must be in Hong Kong.²⁴

Tax: profits tax is 16.5% for corporations, with 8.25% on the first HK$2 million of assessable profits, and only one of a group of connected entities can elect the lower tier for a year (as of October 2026).²⁵²⁶ It applies to profits arising in or derived from Hong Kong from a business carried on there, whether or not the owner is resident.²⁵

United Kingdom Private Limited Company (Ltd)

Companies House charges £100 to incorporate digitally (£124 on paper) and £50 for a digital confirmation statement, under fees in force since 1 February 2026 (as of October 2026).²⁷²⁸ Since 18 November 2025, new directors and people with significant control (PSCs) must verify their identity through GOV.UK One Login or an Authorised Corporate Service Provider.²⁹ A company must have at least one director who is a natural person (Companies Act 2006 section 155).³⁰

Tax: Corporation Tax is 25% on profits over £250,000 and 19% on profits of £50,000 or less, with marginal relief in between (as of October 2026).³¹ A company incorporated in the UK is UK resident for Corporation Tax purposes (Corporation Tax Act 2009 section 14(1)).³²

Comparison Table

All figures are as of October 2026 and come from the official sources cited above.

Item	Singapore Pte Ltd	US (Delaware / Wyoming)	Hong Kong Ltd	UK Ltd
Registry	ACRA (Bizfile)⁸	Delaware Division of Corporations; Wyoming Secretary of State¹³¹⁶	Companies Registry²²	Companies House²⁷
Formation fee	S$15 name + S$300 registration⁸	Wyoming LLC US$100; Delaware: check the Division’s fee schedule¹⁶	HK$1,545 electronic, plus Business Registration HK$2,350 (one year)²²²³	£100 digital²⁷
Recurring registry charge	S$60 annual return⁸	Delaware LLC US$400 tax; Delaware corporation from US$175 + US$50; Wyoming from US$60¹³¹⁵¹⁶	HK$105 annual return + Business Registration renewal²²²³	£50 digital confirmation statement²⁷
Local officers	At least one ordinarily resident director; resident secretary within 6 months¹⁰	Registered agent (Wyoming lists no-agent reinstatement fees)¹⁶	Director need not be resident; secretary resident in Hong Kong²⁴	At least one natural-person director; identity verification²⁹³⁰
Headline corporate rate	17%¹¹	21% federal (C-Corp); single-member LLC disregarded unless elected¹⁸¹⁹	8.25% / 16.5%²⁵	19% / 25%³¹
Small-profit or start-up relief	Partial and start-up exemptions¹¹	None researched	Two-tiered rate, one entity per connected group²⁶	Marginal relief³¹
Ownership reporting	Check ACRA	US-formed companies exempt from FinCEN BOI²¹	Check the Companies Registry	PSC identity verification²⁹

Decision Matrix: Revenue, Client Location, and Staffing

Use this table as factors to discuss with an adviser, not as a ranking. Japan’s permanent establishment (PE, Koukyuteki Shisetsu 恒久的施設) definition covers a fixed place of business, a construction site and a dependent agent with contract authority, subject to any treaty (Corporation Tax Act Article 2(xii-19)).³³

Factor	What to discuss	Rules involved
Founder stays in Japan	CFC inclusion while resident; whether management happens abroad; a Japanese PE; whether the company is tax resident where incorporated	STMA Article 40-4;⁶ Corporation Tax Act Article 2(xii-19);³³ IRAS control and management¹²
Clients mostly in Japan	Location test risk; Japanese PE	STMA Article 40-4(2)(iii);⁶ PE definition³³
Clients mostly in the incorporation country	Local invoicing and source rules	Hong Kong territorial source rule²⁵
Small annual profits	Reduced rates and exemptions, and whether the tax burden ratio falls below 20%	IRAS exemptions;¹¹ Hong Kong two-tier;²⁵ UK small profits rate³¹
Office and staff abroad	Substance and management and control tests	STMA Article 40-4(2)(iii)⁶
Need for a founder visa	Shareholding, nationality and endorsement rules	EntrePass;¹ E-2;³⁴ L-1A;³ Innovator Founder;⁵ Hong Kong entrepreneur route⁴
US entity type	LLC vs C-Corp for US tax, and LLC treated as a corporation in Japan	IRS;¹⁸¹⁹ NTA Q&A³⁵

Opening Corporate Bank Accounts: Compliance Hurdles and Fintech Alternatives

Why Banks Ask for Substance and In-Person Verification

Banks must carry out customer due diligence, including identifying beneficial owners, so expect questions on ownership and business purpose.³⁶ The Hong Kong Monetary Authority (HKMA) states that applications should not be rejected merely because the customer is incorporated offshore or its beneficial owners or directors are non-residents.³⁶ HKMA also notes that Simple Bank Accounts exist for business customers needing basic services.³⁷

Electronic Money and Payment Institutions

Non-bank payment providers are regulated separately from banks. Singapore’s Payment Services Act 2019 sets three licence classes (money-changing, standard payment institution and major payment institution), and the Monetary Authority of Singapore (MAS) lists licensees in its Financial Institutions Directory.³⁸ In the UK, payment and e-money institutions must be authorised or registered with the Financial Conduct Authority (FCA), and money held with them is safeguarded rather than protected by the Financial Services Compensation Scheme (FSCS).³⁹

Japanese-Side Reporting When Money Moves

Moving money between Japan and the new company can trigger Japanese reporting, covered (with the Common Reporting Standard) in the guide on international money transfers from Japan.

Japan’s Anti-Tax Haven Rules (CFC): The Phantom Tax Trap

Japan’s CFC regime, commonly called Takkusu Heibun Taisaku Zeisei (タックスヘイブン対策税制), can tax a foreign company’s income in its Japanese owner’s hands even if no dividend is paid.⁶ For individuals the rule is STMA Article 40-4; Article 66-6 is the parallel rule for a Japanese company, such as a KK owning the foreign company.⁶

A foreign related company (Gaikoku Kankei Kaisha 外国関係会社) is a foreign corporation in which Japanese residents, domestic corporations and specially related non-residents together hold more than 50% of the shares, voting rights or dividend entitlements (direct plus indirect), or one under a resident’s or domestic corporation’s de facto control (Jisshitsu Shihai 実質支配).⁶ A resident is subject to inclusion if they hold 10% or more, have de facto control, or belong to a same-family shareholder group (Dozoku Kabunushi Group 同族株主グループ) holding 10% or more.⁶

The Three Categories and the 20% and 27% Thresholds

A specified foreign related company (Tokutei Gaikoku Kankei Kaisha 特定外国関係会社) has four limbs: a paper company, a de facto cash box, certain captive insurance companies, and companies in jurisdictions the Finance Minister designates as significantly non-cooperative on tax information exchange.⁶ All of its income is included unless its tax burden ratio (Sozei Futan Wariai 租税負担割合) is 27% or more (as of October 2026).⁶ For individuals, the 27% figure (previously 30%) applies to inclusion amounts for the 2024 tax year onward.⁴⁰

A target foreign related company (Taisho Gaikoku Kankei Kaisha 対象外国関係会社) fails at least one economic activity test; all of its income is included unless its tax burden ratio is 20% or more (as of October 2026).⁶ A partial target foreign related company (Bubun Taisho Gaikoku Kankei Kaisha 部分対象外国関係会社) passes all of the tests, and only specified, largely passive income is included.⁶ That inclusion does not apply if the tax burden ratio is 20% or more, or if the amount is ¥20 million or less or 5% or less of pre-tax income as defined (Article 40-4(12)) (as of October 2026).⁶

The FY2026 tax reform extends to individuals several technical changes made for corporations, such as a special rule for partial target companies in liquidation, for foreign company fiscal years beginning on or after 1 April 2026.⁴¹ These changes now appear in the consolidated text, and the 27% and 20% thresholds and the economic activity tests are unchanged.⁶

The flow below summarises the classification (thresholds as of October 2026).⁶

flowchart TD
    A["Foreign company more than 50% held by Japan residents and domestic corporations, or under de facto control"] --> B{"Do you hold 10% or more, have de facto control, or belong to a 10% family group?"}
    B -->|No| Z["No individual inclusion under Article 40-4"]
    B -->|Yes| C{"Paper company, cash box, captive insurer or listed non-cooperative jurisdiction?"}
    C -->|Yes| D{"Tax burden ratio 27% or more?"}
    D -->|Yes| N["No inclusion"]
    D -->|No| E["All income included"]
    C -->|No| F{"Passes all four economic activity tests?"}
    F -->|No| G{"Tax burden ratio 20% or more?"}
    G -->|Yes| N
    G -->|No| E
    F -->|Yes| H{"Tax burden ratio 20% or more, or within the 20 million yen or 5% de minimis?"}
    H -->|Yes| N
    H -->|No| I["Specified passive income included"]

How the Income Is Taxed in Your Hands

The inclusion amount (Kazei Taisho Kingaku 課税対象金額) is the company’s adaptable amount multiplied by your ownership ratio, treated as miscellaneous income (Zatsu Shotoku 雑所得) revenue.⁶ It is added to your income for the year containing the day four months after the end of the foreign company’s fiscal year.⁶ For a company with a 31 December year end, that day is 30 April, so the amount falls into the following year’s return.⁶

The adaptable amount (Tekiyo Taisho Kingaku 適用対象金額) is the company’s income recomputed under Japanese corporate tax rules, adjusted for tax and for losses from fiscal years beginning in the previous seven years; company losses stay inside the calculation rather than passing to you.⁶ Dividends the company later pays you are deducted from your dividend income up to amounts included in that year and the previous three years (Article 40-5).⁶

Documents: you must attach the company’s balance sheet, profit and loss statement and other prescribed documents to your final return for a target company under 20%, a specified company under 27%, or a partial target company under 20% not excused by the de minimis; if the de minimis applies, you retain them instead (Article 40-4(14) and (15)).⁶ The NTA schedules for residents are forms 753 to 757.⁴²

US LLCs and Other Pass-Through Entities Under Japanese Tax

The National Tax Agency (NTA) treats a US LLC formed under a state LLC Act as, in principle, a foreign corporation (Gaikoku Hojin 外国法人) for Japanese tax, whether it chose corporate or pass-through taxation in the US.³⁵ NTA cites court decisions treating a New York LLC as a corporation, but each LLC must still be judged against its own state statute.³⁵ An LLC more than 50% owned by Japan residents is therefore a foreign related company under Article 40-4.⁶³⁵

The practical risk: a single-member LLC owned by a non-US person is disregarded for US income tax, so there may be no entity-level US tax to count toward its Japanese tax burden ratio.¹⁹ How the ratio is computed for a disregarded LLC was not confirmed in official guidance, so ask a Zeirishi before assuming any outcome.

Headline Rates vs the 20% Line (Illustrative)

This table is illustrative only; rates are as of October 2026.

Jurisdiction	Headline rate	At headline, vs 20%	Caveat
Singapore	17%¹¹	Below	Partial and start-up exemptions reduce tax actually paid¹¹
Hong Kong	8.25% on first HK$2 million; 16.5% above²⁵	Below	Territorial source rule affects what is taxed²⁵
United Kingdom	19% small profits; 25% main³¹	19% below; 25% above	Marginal relief between the limits³¹
US C-Corporation	21% federal¹⁸	Above at federal level	State taxes not covered
US single-member LLC	No entity-level income tax by default¹⁹	Risk of being below	Ratio method for disregarded LLCs not confirmed

The test is not the headline rate. The tax burden ratio compares tax actually imposed with income computed under the Cabinet Order rules, so exemptions, reliefs and base differences can move a company across the line.⁶

The Economic Activity Tests: Business, Substance, Management Control, and Location or Unrelated-Party

The four economic activity tests (Keizai Katsudo Kijun 経済活動基準) are in STMA Article 40-4(2)(iii), and failing any one makes the company a target foreign related company.⁶ If you do not provide documents the tax office requests to show the tests are met within the period set, the company is presumed to fail them (Article 40-4(4)).⁶

Business Test (事業基準)

Under the business test (Jigyo Kijun), the main business must not be holding shares or bonds, providing industrial property rights, know-how or copyrights, or leasing ships or aircraft.⁶ Limited exceptions exist, such as qualifying regional headquarters holding companies.⁶

Substance Test (実体基準)

Under the substance test (Jittai Kijun), the company must have, in its head office country, an office, shop, factory or other fixed facility needed for its main business.⁶

Management and Control Test (管理支配基準)

Under the management and control test (Kanri Shihai Kijun), the company itself must carry out the management, control and operation of its business in its head office country.⁶ Local staff and local decision-making are evidence, but “local employees” is not a separate statutory test. A founder who decides and does everything from Japan puts this test at risk; failing it together with the substance test is the core of the paper company definition.⁶

Location Test (所在地国基準) or Unrelated-Party Test (非関連者基準)

The unrelated-party test (Hi-Kanrensha Kijun) applies to wholesale, banking, trust, financial instruments business, insurance, water transport, air transport and aircraft leasing: the business must be carried on mainly with unrelated persons, which for wholesale means more than 50% of sales or purchases.⁶⁷ The location test (Shozaichi-koku Kijun) applies to all other businesses, which must be carried on mainly in the head office country.⁶⁷ How it applies to a software or consulting company with mostly Japanese clients was not confirmed in an NTA circular, so review that risk with a Zeirishi.

Paper Company and Cash Box Definitions

A paper company fails both the substance and the management and control tests, with exceptions for certain holding companies.⁶ A de facto cash box has passive income exceeding 30% of total assets, where securities, loans and similar assets exceed 50% of total assets.⁶ Both fall under the 27% threshold.⁶

Corporate Director Visas: Securing Residency Through Your Own Entity (EntrePass, E-2, L-1, UK Innovator Founder)

These are summaries; the Singapore and USA destination guides go deeper.

Singapore EntrePass

The Ministry of Manpower (MOM) requires an ACRA-registered (or soon to be registered) private limited company in which the applicant holds at least 30%, and the company must be venture-backed or own innovative technologies (as of October 2026).¹ Criteria include raising at least S$100,000 in one funding round or support from a recognised incubator or accelerator.¹ The pass is issued for up to one year at first, with no minimum salary (as of October 2026).⁴³

United States: E-2 Treaty Investor and L-1A New Office

E-2 Treaty Investor: Japan has had an E-2 treaty with the US since 30 October 1953.³⁴ The enterprise must be at least 50% owned by treaty nationals, and separately the investor must control it, normally through at least 50% ownership or operational control.²³⁴ There is no set minimum, but the investment must be substantial in proportion to the cost of the business.²³⁴

L-1A new office: the US company needs a qualifying relationship with a foreign employer, for which the founder generally must have worked one continuous year within the previous three, in an executive or managerial role for a new office petition.³ The initial stay is up to one year.³ If your only qualifying foreign employer is your Japanese KK, closing it first may remove the L-1 basis, so plan the KK decision with an immigration lawyer.³

United Kingdom Innovator Founder

The Innovator Founder visa opened on 13 April 2023, replacing the Innovator and Start-up routes;⁴⁴ the business must be new, innovative, viable and scalable and endorsed by an approved endorsing body, and gov.uk states no minimum investment.⁵ Fees are £1,357 for an application from outside the UK, plus £1,000 for endorsement and £500 for each of at least two contact point meetings, payable to the endorsing body and excluding VAT (as of October 2026).⁵⁴⁵ The visa lasts three years, can be extended, and has an English language requirement.⁵

Hong Kong: Investment as Entrepreneurs

The Immigration Department’s entrepreneur route requires a substantial contribution to Hong Kong’s economy, judged on factors such as the business plan, financial resources, investment and local jobs; a local sponsor is needed and approval is discretionary.⁴ The initial stay is normally up to 36 months (as of October 2026).⁴

Visa Comparison Table

All entries are as of October 2026.

Route	Who qualifies	Ownership requirement	Investment (as stated by the authority)	Initial validity	Source
Singapore EntrePass	Founders of venture-backed or innovative companies	At least 30% of an ACRA-registered Pte Ltd	Innovation criteria, e.g. at least S$100,000 raised in one round	Up to 1 year	MOM¹⁴³
US E-2	Treaty nationals, including Japanese nationals	Enterprise at least 50% owned by treaty nationals; investor control	No set minimum; proportionality test	Admission up to 2 years	USCIS, 9 FAM²³⁴
US L-1A new office	Executives or managers of a related foreign organisation	Qualifying corporate relationship	Not a stated criterion; premises required	Up to 1 year	USCIS³
UK Innovator Founder	Founders endorsed by an approved body	Not stated on the overview page	No minimum	3 years	Home Office⁵⁴⁴
Hong Kong entrepreneur	Applicants making a substantial economic contribution	Not stated	Assessed as a factor; no figure	Normally up to 36 months	Immigration Department⁴

Closing or Keeping a Japanese Business Before Relocation

Sole Proprietors: Closure Filings and the Final Return

The NTA lists three main closure forms for sole proprietors.⁴⁶ The Kojin Jigyo no Kaigyo, Haigyo-to Todokedesho (個人事業の開業・廃業等届出書) is due by the final return filing deadline for the year in which the business closed (Income Tax Act Article 229).⁴⁷⁴⁸ If you file blue returns, the Aoiro Shinkoku no Toriyame Todokedesho (所得税の青色申告の取りやめ届出書) is due by the final return deadline of the year from which you stop.⁴⁹

Consumption tax: a taxable business files the Jigyo Haishi Todokedesho (事業廃止届出書) promptly, and an invoice-registered business (Tekikaku Seikyusho Hakko Jigyosha 適格請求書発行事業者) files this form rather than a registration cancellation form.⁵⁰ Once it is filed, the invoice registration lapses on the day after the business closed (Consumption Tax Act Article 57-2(10)(ii)).⁵¹ A final consumption tax return covers the closure period, and business assets converted to private use are deemed transferred at market value.⁵⁰

Leaving Japan in the closure year: the final return, or a quasi-final return (Jun-Kakutei Shinkoku 準確定申告) if you leave without a tax agent, is covered in the guide on appointing a tax agent (Nohzei Kanrinin 納税管理人). Ask a Zeirishi before transferring clients, equipment or intellectual property into the new company.

Kabushiki Kaisha Option 1: Dissolution and Liquidation (解散・清算)

Dissolution by shareholders’ resolution (Companies Act Article 471(iii)) requires a special resolution (Article 309(2)(xi)).⁵² Dissolution and the liquidator must each be registered within two weeks (Articles 926 and 928), and creditors must be notified in the official gazette (Kanpo 官報) and individually if known, with a claim period of at least two months (Article 499).⁵² After the shareholders’ meeting approves the liquidator’s final report (Article 507(3)), completion of liquidation is registered within two weeks (Article 929).⁵²

Registration and license tax (Appended Table 1) is ¥30,000 for dissolution, ¥9,000 for the liquidator and ¥2,000 for completion of liquidation (as of October 2026).⁵³ A Shiho Shoshi (司法書士, judicial scrivener) handles registrations and a Zeirishi the liquidation-period returns; their fees and gazette costs are extra.

flowchart TD
    A["Shareholders pass a special resolution to dissolve"] --> B["Register dissolution and liquidator within 2 weeks"]
    B --> C["Gazette notice and notice to known creditors: claim period of at least 2 months"]
    C --> D["Settle debts and distribute remaining assets"]
    D --> E["Shareholders approve the liquidator's final report"]
    E --> F["Register completion of liquidation within 2 weeks"]

Option 2: Suspension (休業) Without Dissolution

No statutory “dormant company” election was found in the Companies Act provisions reviewed.⁵² A suspended KK still has directors whose terms run (two years by default, up to ten years for non-public companies if the articles allow), and changes must be registered within two weeks (Articles 332 and 915).⁵² Tax office and municipal notices for a suspension, and whether per-capita inhabitant tax (Kintowari 均等割) continues, were not confirmed on official pages; check with each office.

Deemed dissolution: a company with no registration for 12 years is a dormant company (Kyumin Kaisha 休眠会社), and after the Minister of Justice publishes a gazette notice it is deemed dissolved unless it files, within two months, a notice that it has not ceased business (Article 472).⁵²

Option 3: Keep the KK Running With You as a Non-Resident Director

Since the Ministry of Justice notice of 16 March 2015 (民商第29号), registrations of incorporation and of representative directors are accepted even if every representative director lives outside Japan, and Japanese nationality is not required.⁵⁴ KK shares you hold when you leave may count for Japan’s exit tax (Kokugai Tenshutsuji Kazei 国外転出時課税), covered in its own guide. If the KK owns the foreign company, the corporate CFC rule in Article 66-6 applies to the KK, also with four-month timing.⁶

Timeline: T-12 Months to First Year Abroad

Period	Actions	Deadline anchors
T-12 to T-9 months	Compare jurisdictions; review the CFC position and departure timing with a Zeirishi; check visa routes (keep the KK operating if an L-1 is possible)	CFC status tested at the foreign company’s year end⁷³
T-9 to T-6 months	Incorporate; appoint officers; complete UK identity verification; open a bank or payment account	Singapore secretary within 6 months;¹⁰ UK verification before incorporation²⁹
T-6 to T-3 months	Move contracts; choose the KK option; if dissolving, start early	KK registrations within 2 weeks; creditor period at least 2 months⁵²
T-3 months to departure	Appoint a tax agent or prepare a quasi-final return; file the consumption tax closure notice	Jigyo Haishi Todokedesho promptly⁵⁰
Next filing season	Closure notice and blue-return withdrawal; final returns	Final return deadline for the closure year⁴⁸⁴⁹
First year abroad	Foreign annual filings; review any CFC inclusion for company years that ended while you were resident	Delaware LLC tax by 1 June;¹³ Form 5472 with pro forma 1120;²⁰ UK confirmation statement²⁷

Before departure, also check the exit tax on founder shares, covered in its own guide, and the foreign asset statement (Kokugai Zaisan Chosho 国外財産調書), covered in the guide to golden visas and residency by investment.

Japanese Citizens vs. Foreign Residents: Critical Distinctions

Topic	Japanese citizens	Foreign residents
Japanese CFC rule (Article 40-4)	Applies while tax resident⁶	Applies while tax resident; nationality irrelevant⁶
Home-country rules on foreign companies	Destination rules apply after the move	Home-country rules may also apply throughout
US E-2 eligibility	Japanese nationals qualify (treaty since 1953)³⁴	Depends on the founder’s own nationality³⁴
Status in Japan	No immigration status to maintain	Closing or leaving a business may affect a business-based status
Directing a KK from abroad	Permitted⁵⁴	Permitted; no nationality requirement⁵⁴

Home-country rules on foreign companies (for US citizens, for example) are not covered here. If your residence status depends on running a business in Japan, such as Business Manager, closing the KK affects that status; the guide on Japanese citizens vs foreign residents departure rules covers status and re-entry permits.

Common Pitfalls & Regulatory Compliance Risks

Assuming a US LLC is pass-through in Japan. Treat it as a foreign corporation unless a Zeirishi confirms otherwise.³⁵
Running the company entirely from Japan. This puts management and control, PE and tax residence at issue.⁶³³¹²
Skipping the CFC documents. Attach or retain the company’s financial statements.⁶
Closing the KK before an L-1 petition. Confirm the qualifying year of employment first.³
Missing the closure filings. File the Jigyo Haishi Todokedesho promptly and the closure notice by the final return deadline.⁴⁸⁵⁰⁵¹
Forgetting a suspended KK. Keep director registrations current to avoid deemed dissolution.⁵²
Missing Form 5472 or UK filings. The Form 5472 penalty is US$25,000 (as of October 2026); UK directors also need identity verification and a confirmation statement.²⁰²⁷²⁹

References & Official Sources

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