2025 revisions to the Ministerial Ordinance on Landing Criteria have made the requirements for obtaining a Business Manager Visa stricter than ever before.
The long-standing benchmark of “JPY 5 million in capital” has been abolished, and the minimum capital requirement has been raised significantly to “JPY 30 million or more”, creating an enormous impact for foreign entrepreneurs planning to start a business in Japan.
In this article, we explain in detail, from the latest practical perspective, the appropriate level of executive compensation under this new requirement era (the JPY 30 million capital era), as well as the exceptional arrangement of “receiving compensation from an overseas parent company”.
- 1. Stricter Business Manager Visa Requirements: Capital Raised to JPY 30 Million
- 2. How to Think About Executive Compensation Under the New Standard
- 3. Exceptional Rule: When Compensation Is Paid by an Overseas Company
- 4. Important Point for Visa Renewals: The Risk of Cutting Compensation
- 5. Summary
- What Our Office Can Do for You
1. Stricter Business Manager Visa Requirements: Capital Raised to JPY 30 Million
Until now, the business scale requirement for the Business Manager Visa was “capital of at least JPY 5 million” or “at least two full-time employees.” However, due to this ministerial revision, the standard has been fundamentally changed to “capital of at least JPY 30 million” and “employment of at least one full-time employee”.
The purpose behind this revision is to prevent the proliferation of paper companies with no real substance and to attract businesses of a scale that can genuinely contribute to the Japanese economy. With the capital requirement increased sixfold to JPY 30 million, it is fair to say that the bar for demonstrating “business stability and continuity” in the screening process has risen dramatically as well.
This change does not simply mean that more money is needed for preparation. It also directly affects the standard for deciding how much executive compensation should be set.
2. How to Think About Executive Compensation Under the New Standard
2-1. The End of the “JPY 200,000 per Month” Myth
Traditionally, in Business Manager Visa practice, “around JPY 200,000 per month” had been regarded as the minimum benchmark for executive compensation. This figure was based on the minimum living expenses needed to live in Japan, such as rent and everyday costs.
However, now that the capital requirement has been raised to JPY 30 million, this figure of “JPY 200,000 per month” can no longer be considered appropriate. The reason is that if the head of a company with JPY 30 million in capital is paid at the same level as, or even less than, a new graduate employee, it is likely to be viewed as unnatural from a business standpoint and lacking in rationality.
2-2. Compensation Appropriate to the Scale of Capital
Immigration officers closely examine whether the submitted business plan is internally consistent. If the executive compensation is set extremely low despite the business being large enough to secure JPY 30 million in capital, it may raise doubts such as the following:
- “Is the business not actually operating, and was the capital merely temporary funds for appearance’s sake?”
- “Does the applicant lack real authority or capability as a business manager?”
- “Is this business plan incapable of generating a proper profit?”
Therefore, under the new standard, it is recommended to set executive compensation at JPY 300,000 or more per month, and ideally around JPY 400,000 to JPY 500,000. This is not only necessary to demonstrate stability of living in Japan, but also to maintain consistency with the social credibility expected of someone managing a company with JPY 30 million in capital.
Of course, in the startup phase of a business, management may reasonably wish to prioritize cash flow. However, if compensation is set so low that it cannot even cover basic living expenses (for example, around JPY 50,000), doubts will arise as to whether the applicant can actually live in Japan, which may in turn lead to suspicion of unauthorized work outside visa status. Setting compensation confidently at a level commensurate with a capital base of JPY 30 million is the fastest path to visa approval.
3. Exceptional Rule: When Compensation Is Paid by an Overseas Company
As a general rule, executive compensation for a Business Manager Visa should be paid by the Japanese company being managed. However, in practice, a common situation is where the applicant also serves as an executive of a parent company or affiliated company in their home country.
In such cases, if there is a relationship between the Japanese company and the overseas company, it may be possible for the applicant to receive no compensation from the Japanese entity and instead be paid exclusively by the overseas company.
3-1. Institutional Treatment and Key Points to Note
To have this arrangement recognized, it is not enough merely to show that “money is being paid from overseas.” It is also necessary to prove requirements such as the following:
- Relationship between the overseas company and the Japanese company: It must be shown that the two companies have a close capital, business, or personnel relationship, such as the Japanese entity being a subsidiary of the overseas company, or the representative of the overseas company also serving as the representative of the Japanese entity, with the two companies having a high degree of business relevance.
- Actual dual-role duties: The applicant must be substantively performing not only the management of the Japanese entity but also duties as an executive of the overseas company.
- Proof of sufficient compensation: The compensation paid by the overseas company must be sufficient to support the applicant’s life in Japan as a business manager (taking the new standard into account, an amount equivalent to at least JPY 300,000 to JPY 400,000 per month is desirable when converted into Japanese yen).
Using this structure can help secure the manager’s living expenses without placing cash flow pressure on a newly established Japanese company.
However, under the strict new requirement of JPY 30 million in capital, it remains necessary to closely monitor how this “no compensation from the Japanese side” arrangement will be treated in future practice.
Given the requirement for substantial capital, it cannot be ruled out that the profitability and independence of the Japanese corporation alone may be examined more rigorously.
Therefore, when applying, it will be essential to prepare not only an employment certificate and proof of income from the overseas company, but also a rational explanation for why no compensation is paid from the Japanese side, along with documents proving the relationship between the two companies (such as a secondment order or dual-appointment notice), with even greater precision than before.
4. Important Point for Visa Renewals: The Risk of Cutting Compensation
After obtaining a Business Manager Visa, the actual business may not grow as expected, and operating at a loss is not uncommon. In such situations, it is natural for a manager to think about reducing executive compensation as a cost-cutting measure.
However, careless reductions in compensation can be fatal when it comes time to renew the visa. If compensation that was initially set at a higher level is significantly reduced at renewal time (for example, to less than JPY 200,000 per month), it will be viewed negatively in the following two respects:
- Lack of生活 stability: Questions will re-emerge as to whether the applicant can maintain a stable life in Japan.
- Lack of business continuity: It may be judged that “the company’s management has deteriorated to the point where it cannot continue without drastically cutting executive compensation.”
To avoid a visa renewal denial, executive compensation should not be drastically reduced or made unpaid simply because the business is underperforming. Once a company has entered the market by satisfying the JPY 30 million capital requirement, even paying executive compensation by drawing down that capital while rebuilding the business can be viewed as evidence of the determination and planning ability that support a sustainable management record under immigration review.
5. Summary
Under the new standard that raises the capital requirement to JPY 30 million, executive compensation should no longer be considered as a simple extension of past practice.
- Higher benchmark amount: As a guideline, set compensation at JPY 300,000 or more per month so that it matches the scale of capital.
- Use of overseas payments: If there is a relationship with an overseas company, it may be possible to structure compensation so that the Japanese entity bears no burden and payment is made from abroad, but great caution is required regarding how this will be handled under the new standard.
- Planning with renewal in mind: Avoid easy reductions and build sufficient personnel costs into the budget from the business planning stage.
With this institutional revision, the Business Manager Visa has evolved from “a visa that almost anyone could obtain” into “a visa for genuine business managers.” While the requirements have become stricter, obtaining approval now carries greater social credibility. If you need support in preparing a business plan that complies with the new requirements or in designing a complex executive compensation structure, please consult our office.
What Our Office Can Do for You
These are the key points for setting executive compensation in a stricter Business Manager Visa application environment.
Determining executive compensation is not simply a matter of choosing a salary amount; it is an important factor in proving the balance and sustainability of the business’s financial plan. The structure will vary depending on the business model, but more than ever, it is essential to understand that ① meeting the new baseline requirements (JPY 30 million in capital, full-time employee, and business office), and ② preparing a detailed business plan supported by objective evidence, have become indispensable.
Creating a business plan that meets these standards is a major task, but when it is carefully thought through and properly documented, it will certainly help with running the business after the visa is granted. Take the time to prepare it thoroughly and with care.
Because the requirements have become extremely complex and strict, if you find it difficult to assess consistency under the new standard or determine the right compensation structure on your own, be sure to consult our office, a professional certified administrative scrivener firm.
