The 開業届, the blue return, and the money systems freelancers set up first.
File a 開業届 with your tax office and the 青色申告 application at the same time; set up cloud accounting and reserve 20–35% of profit for taxes.
Register by filing a notification of business opening (開業届) with your local tax office, ideally within about a month of starting. At the same time, submit the blue-return application (青色申告承認申請書) to unlock a deduction of up to ¥650,000 and loss carry-forward. Consider a dedicated business bank account and card to keep records clean, and confirm your residence status permits self-employment.
Bookkeeping is the ongoing work, and cloud tools like freee or Money Forward Cloud automate most of it by importing bank and card transactions and generating blue-return forms and e-Tax data. Because you pay your own income tax, resident tax, national pension, and national health insurance, many freelancers move 20–35% of each payment into a separate tax-reserve account so nothing is a surprise at filing time.
Cloud accounting software · freee K.K.
Beginner-friendly cloud accounting built around guided workflows, popular with sole proprietors for blue-return filing and e-Tax.
Fees: Subscription plans (monthly/annual) vary by tier — verify current pricing.
Cloud accounting software · Money Forward
Cloud accounting with strong automation and integrations, popular with freelancers and small companies that value flexible bookkeeping.
Fees: Subscription plans vary by tier — verify current pricing.
Accounting software · Yayoi K.K.
A long-established accounting-software brand with desktop and cloud options, widely used and supported by tax professionals.
Fees: Desktop license or cloud subscription depending on product — verify current pricing.
File a notification of business opening (開業届) with your local tax office within about a month of starting — it is free and short. At the same time, file the blue-return application (青色申告承認申請書) to unlock the up-to-¥650,000 deduction. You keep your existing visa status if it permits the work; some visa types need permission for self-employment, so check your residence status first.
The blue return is a filing status that rewards proper bookkeeping. With double-entry books filed electronically, you can deduct up to ¥650,000 from your income, carry losses forward for three years, and deduct family salaries. The trade-off is more disciplined recordkeeping — which cloud accounting software largely automates. For most freelancers with steady income, the tax saving clearly outweighs the effort.
A common rule of thumb is to reserve 20–35% of profit for income tax, resident tax, national pension, and national health insurance combined — higher as your income rises, because income tax is progressive. Remember resident tax and health-insurance premiums are billed based on the prior year, so your bills lag your income. Set the reserve aside in a separate account each month rather than facing it all at filing time.
As a sole proprietor you generally enroll in National Health Insurance (国民健康保険) and the National Pension (国民年金), and you pay both yourself — there is no employer split. National Pension is a flat monthly amount; National Health Insurance premiums are income-based and billed by your municipality. You can add optional coverage (e.g. the national pension fund, iDeCo, or income-protection insurance) to close gaps. Budget these into your tax reserve.