Trading name / business address v personal for kojin jigyo expenses?

[bmazodze]

Hello,

First of all apologies for the basic questions, but I’m just at the start of setting everything up for my freelance business and am a bit worried I’ll make a mistake here that could wipe out my ability to claim any startup or ongoing monthly expenses.

I am planning to submit the kaigyo todoke to begin activities as a kojin jigyo mainly selling software/apps online (both Japan and abroad, via app storefronts etc) with a 屋号 trading name of the business name, my personal (rented apartment) address as the taxable location and a virtual office as an ‘other address of business.’ I suppose first question is this the advisable way to do it? I see some people do it the other way but I’m not sure I can see why. Is there any impact (positive or negative) on my personal taxes from my full time job that would be different from putting it the other way round? (Virtual office main with my address as extra)

Following on from that, for any receipts/invoices I’d like to claim as business expenses, would they have to be addressed to ‘trading name, address virtual office’ or ‘trading name, address my home,’ or could they be ‘my name, virtual office’ or ‘my name, my home?’ e.g. if I have an Apple developer account that is registered to me at my address (not to the business or with address of the virtual office) could I claim that?

Thanks in advance for any advice, this subreddit is always a massive help to me so great job everyone who contributes.

 

[kristhuy]

@bmazodze

is this the advisable way to do it?

If you live in Japan and you are a sole proprietor you must use your residential address as your 納税地. See here.

with a 屋号 trading name

Just keep in mind that any 屋号 you put on that form is effectively just a reference for you to use on your correspondence with the tax office. It doesn't constitute "registration" of the name or give you any kind of right to use the name publicly.

Is there any impact (positive or negative) on my personal taxes from my full time job that would be different from putting it the other way round?

No. But also, you can't put it the other way around (see link above). If you want to use a different address as your 納税地, you would need to incorporate.

would they have to be addressed to ‘trading name, address virtual office’ or ‘trading name, address my home,’ or could they be ‘my name, virtual office’ or ‘my name, my home?’

It doesn't really matter as long as it's clear that you're the one being billed. Remember that your business is not a separate entity from you (unless you incorporate), so the business itself can't technically be liable to pay an invoice, etc.

 

[bmazodze]

@kristhuy Thanks a lot for the answer. Regarding ‘registration’ of the 屋号, in that case is there anything I can / should do that would help protect the name as mine to use or is the only way incorporation?

 

[kristhuy]

@bmazodze

is there anything I can / should do that would help protect the name as mine to use or is the only way incorporation?

Do you want to prevent others from using the name or do you just want to know whether you can use it?

The use of trading names in the marketplace is basically governed by trademark law. So the only way to know whether you can use a trading name is to do a trademark clearance search. Generally speaking, as long as no one has registered a similar trademark in the same field as your business, you are free to use the name. (There are also some words that cannot be used in trading names without satisfying certain conditions—words like bank, life insurance, etc.)

If you want to prevent other people from using the name, the standard approach would be to register a trademark.

The only protection you get from incorporation is that no one else will be able to register a company with both the same name and the same address as you. Obviously that's no protection at all. The Legal Affairs Bureau also runs a name register for unincorporated businesses (see here), but it merely does the same thing as the company register: it prevents someone from using your name and address in combination, which is pretty useless.

 

[resjudicata]

@bmazodze Regarding receipts, your 屋号 is basically just an alias. It doesn’t matter if the receipt has it or your real name. In fact, most small receipts don’t technically need to have any name at all.

For your invoices, any combination of your name, trading name, home address, business address is fine.

 

[bmazodze]

@resjudicata Thank you for the answer!