This article is a translation of the Japanese original. Where the two differ, the Japanese version prevails. Read the Japanese original（日本語版を読む）
When you return home, two procedures are needed: dealing properly with your status of residence, and the liquidation of the company you set up.You notify the Immigration Services Agency of Japan within 14 days of the day you stop the business, and you return your Residence Card when you leave. For the company, at least 2 months are needed from the registration of dissolution to the completion of liquidation.
We have gathered the procedures needed by a foreign manager who has found it hard to keep the business going and has decided to return to their home country.
Giving up a business is by no means a failure; it is a period of preparation for the next stage of your career. When a foreign manager leaves Japan, however, there is more to it than packing your bags and boarding a plane: two very important procedures remain, namely dealing properly with 「経営・管理」 and carrying out the liquidation of the company you set up. If these are neglected, there is a risk that your visa will be revoked, or that you will be at a disadvantage when you next enter Japan.
You are under a duty to make the notification concerning the organisation of activity to the Immigration Services Agency of Japan within 14 days of the day you close the business.
If you close your business in Japan and stop carrying out the activity on which your status of residence rests, the status of residence does not automatically lapse, but proper steps are needed.
「経営・管理」 is the status of residence for running and managing a company in Japan. You are under a duty to make the 「活動機関に関する届出」 (notification concerning the organisation of activity) to the Immigration Services Agency of Japan within 14 days of the day you stop (close) the business. Neglecting this notification may put you at a disadvantage if you apply again in future, so please be sure to make it.
If you are leaving Japan for good and giving up your status of residence, you return your Residence Card at departure inspection at the airport. With that return, the status of residence formally comes to an end.
Before you return your Residence Card, we recommend keeping to hand the copy of it that you used for procedures such as an 在留期間更新許可申請 (Application for Extension of Period of Stay).
If you cannot fully liquidate the business before leaving and have no choice but to put off your departure, you may also consider an 在留資格変更許可申請 (Application for Change of Status of Residence) to 在留資格「特定活動」 (Designated Activities). It is a procedure for obtaining a period of grace in which to prepare to leave, for instance by liquidating the company.
Besides the registration of dissolution and the liquidation, you need to notify closure to the tax office and other bodies and to deal with social insurance and labour insurance.
More complex, and more demanding of time and effort, than the visa procedures is the liquidation of the company you set up. A company has legal personality, so you cannot simply leave it alone because you have stopped trading.
To make the company formally cease to exist, you decide on dissolution, register the dissolution at the Legal Affairs Bureau, and then carry out the liquidation, in which the assets are put in order.
Once you have decided on dissolution and liquidation, you submit a notification of change (異動届出書, the notification of closure) to the tax office, the prefectural tax office and the municipal office. If you neglect to submit it, the per capita levy of corporate inhabitant tax (some tens of thousands of yen a year) will continue to be charged every year, even though there is no business in substance. If those payments fall into arrears after you have gone home, it leads to serious trouble.
For the social insurance (health insurance and employees' pension) and the labour insurance (employment insurance and workers' accident compensation insurance) that the directors and employees were enrolled in, notifications of loss of insured status and of closure of the workplace are also needed.
The liquidation of a company takes at least 2 months from the registration of dissolution to its completion (the registration of completion of liquidation). The tax and social insurance procedures are complex too, so trying to do all of it yourself will get in the way of your schedule for going home. We strongly recommend entrusting the whole of it to experts (a certified administrative procedures legal specialist (gyoseishoshi), a judicial scrivener and a certified tax accountant).
You appoint a tax agent and notify the tax office, and you deal with any debts left in the company within the liquidation.
Even after you return home, tax returns and tax payments arising from the liquidation of the company may still come up. A personal tax return may also be needed. In that case, you need to appoint a 「納税管理人」 (tax agent) to carry out the tax procedures on your behalf, and to notify the tax office. An individual or a company resident in Japan can serve as the tax agent.
Be sure to check the debts left in the company — bank borrowings, unpaid accounts, penalties under the office lease and so on — and deal with them within the liquidation. If the company's debts are left unresolved, the liquidation cannot be completed.
It may become hard to enter Japan again, and a risk remains of being drawn into trouble over taxes and debts within Japan.
Dealing with 「経営・管理」 and liquidating the company are not mere paperwork. They round off your career in Japan, and they are an important process for moving on to the next step.
If you return home leaving the procedures unclear, not only may it become hard to enter Japan again in future, but a risk remains of being drawn into trouble over taxes and debts within Japan. If the company's tax and financial affairs are neglected, the manager may be held personally responsible, and it may have an adverse effect on screening when you next enter the country.
You are under a duty to make the 「活動機関に関する届出」 (notification concerning the organisation of activity) to the Immigration Services Agency of Japan within 14 days of the day you stop (close) the business. Neglecting it may put you at a disadvantage if you apply again in future.
You may consider an 在留資格変更許可申請 to 「特定活動」. It is a procedure for obtaining a period of grace in which to prepare to leave, for instance by liquidating the company.
The per capita levy of corporate inhabitant tax (some tens of thousands of yen a year) will continue to be charged every year, even though there is no business in substance. If those payments fall into arrears after you have gone home, it leads to serious trouble.
At least 2 months from the registration of dissolution to the registration of completion of liquidation. Tax and social insurance procedures are needed alongside it, so please work back from your schedule for going home and start early.
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Get a free consultationThis article provides general information. Immigration rules change, and outcomes depend on individual circumstances. Please check the Immigration Services Agency website or consult a qualified specialist.
This page is a translation of the Japanese original. Where the two differ, the Japanese version prevails.