Corporate vs Individual Ownership

1. Tax-rate comparison (annual profit basis)

Individual (progressive + resident):
  ¥3M taxable:   ~20% effective
  ¥7M taxable:   ~30%
  ¥15M taxable:  ~43%
  ¥40M+:         ~55% (national max)

Corporate (small company):
  First ¥8M:     ~22% effective (including local)
  Above ¥8M:     ~35%
  Above ~¥30M:  ~34% (diminishing rate benefit)

Crossover is around ¥8–10M of annual taxable income from the portfolio. Above that, the corporation is cheaper year-to-year.

2. GK vs KK

• GK (godo kaisha): LLC. Setup cost ¥60,000–¥100,000. No board required. Preferred vehicle for property holding.
• KK (kabushiki kaisha): traditional corporation. Setup ¥240,000+. Better perceived credibility with lenders and buyers. Required if you plan to raise third-party equity.

3. Running cost

Corporate income tax filing (accountant):  ¥300,000–¥500,000/year
Consumption-tax filing (if applicable):    ¥100,000+
Corporate resident tax (fixed):            ¥70,000/year even with zero profit
Company registration renewals:             ¥30,000 every 10 years
Total floor:                               ¥500,000/year

Below ¥100M gross with ~7% yield (¥7M gross), you generate ¥3–4M taxable. Tax saving against personal marginal barely covers the ¥500K running cost — indifferent.

Above ¥200M portfolio, the corporate savings compound to millions per year.

4. Financing access

• Non-residents can own 100% of a Japanese GK/KK with no local director.
• Lenders may still ask for a personal guarantee (連帯保証) — negotiate.
• Some regional lenders prefer corporate borrowers for portfolios > 5 units.

5. Estate & succession

Japan inheritance tax applies to property physically in Japan regardless of your residency. Owning through a corporation doesn't eliminate this but shifts the asset being inherited from real estate to shares — often simpler to transfer and lower valuation-basis if the company holds debt against the property.

6. Home-country consequences

• US: a foreign GK is a CFC/PFIC candidate. Talk to a CPA before setting up — the wrong election can create punitive US tax.
• UK/AU: controlled foreign company rules apply if you own > 50%.
• SG/HK: generally clean — foreign-source dividend not taxable.

Rule of thumb

Under ¥100M: personal ownership. ¥100–¥200M: consider corporate if you're still adding assets. Above ¥200M: corporate almost always.