Subsidy, Benefit for rental fee of office space in Japan
Due to covid-19, sales amount of your business might not be good and it might not be easy for you to pay rental fee of your office space or land.
In that case Special office space rental fee subsidy （特別家賃支援給付金）will be available.
Roughly speaking, this subsidy is like this.
Assumed that your company is renting an office space (Monthly rental fee : 150,000 yen) and there was decline in sales amount of your business due to covid 19.
In this case your company can receive 600,000 yen from government of Japan.
It is Subsidy for payment of rental fee of office space, land you are renting for your business in Japan.
If you are using shared office, you can not use this subsidy.
If you are using a part of your residence as an office space and have recorded it as deductible expense in your tax filing paper, you can apply for this subsidy.
EX. You are renting an apartment and monthly rental fee is 100,000 yen. And in your tax filing paper, you allocate 30,000 yen as rental fee of your office space. It is deductible expense.
In this case, you can use this subsidy for rental fee of 30,000 yen.
(As for subsidy for payment of rental fee of your residential space, you can find this page)
Soleproprietor will be able to receive subsidy of up to 3 million yen from the government of Japan and you can use the money to pay rental fee of your office space. (In the case of legal entity, it is up to 6 million yen)
So I would like to explain details with taking up examples according to information as of 29th May 2020.
Decline of sales amount is required to receive Subsidy for rental fee of office space in Japan
Could you confirm if you can satisfy either of below?
1) In the case sales amount of your business in either of May ～ December 2020 decreases by 50% or more compared to same month of 2019.
For example, sales amount in May 2019 was 1 million yen and sales amount in May 2020 is 400,000 yen.
In this case you can satisfy this requirement.
Or
2) In the case sales amount of your business in 3 consecutive months of 2020 decreases by 30% or more compared to same months of 2019
For example, total sales amount in May, June, July 2019 was 1 million yen and sales amount in May, June, July 2020 is 700,000 yen.
In this case you can satisfy this requirement.
How much subsidy you can receive ?
You can receive money equivalent to rental fee for 6 months.
Assumed that you or your company applies for this subsidy in August 2020, referential rental fee is rental fee of July 2020.
It is called “latest rental fee”.
If latest rental fee of company is 750,000 yen or less, calculation formula is as below.
Monthly rental fee * 2/3rd * 6 is paid to your company.
ex. 500,000 yen * 2/3rd = 333,333 yen.
333,333 yen * 6 months = 1,999,998 yen.
So your company can receive 1,999,998 yen as a subsidy.
If latest rental fee of company is more than 750,000 yen, calculation formula is as below.
(Monthly rental fee – 750,000) * 1/3rd + 500,000 yen * 6 is paid to your company.
ex. (800,000 yen – 750,000 ) 1/3rd + 500,000 yen * 6 months = 3,099,999 yen.
So your company can receive 3,099,999 yen as a subsidy.
It is a lump sum payment.
If latest rental fee of Soleproprietor (Kojin Jigyo) is 375,000 yen or less, calculation formula is as below.
Monthly rental fee * 2/3rd * 6 is paid to your company.
ex. 200,000 yen * 2/3rd = 133,333 yen.
133,333 yen * 6 months = 799,999 yen.
So you (Soleproprietor) can receive 799,999 yen as a subsidy.
If latest rental fee of Soleproprietor (ex. freelancer) is more than 375,000 yen, calculation formula is as below.
(Monthly rental fee – 375,000) * 1/3rd + 250,000 yen * 6 is paid to your company.
ex. (450,000 yen – 375,000 ) 1/3rd + 250,000 yen * 6 months = 1,650,000 yen.
So you can receive 1,650,000 yen as a subsidy.
It is a lump sum payment.
And in the case of company, maximum latest rental fee is 1 million yen per a month.
And in the case of sole proprietor, maximum latest rental fee is 500,000 yen per month.
When you rent an real estate in Japan, you will pay Management fee of apartment (Kanrihi=管理費).
ex. Rental fee 80000 yen. Management fee 10,000 yen.
In this case, you may be able to say your latest rental fee is 90,000 yen.
When will you be able to apply for office space rental fee subsidy ?
You can apply for this Kyufukin subsidy from 14th July 2020 to 15th January 2021.will be able to apply for this subsidy in around end of end of June 2020.
You can provide sales ledger (to prove sales amount of 2020), lease contract paper (to prove amount of rental fee) etc.
Even if you have started your business in this year (by end of March 2020), it will be possible.
Necessary documents to apply for office space rental fee subsidy
Lease contract paper of office space etc. (It should include date of end of March 2020)
So if you enter into lease contract on 1st April, 2020, you can not apply for this subsidy.
Your ID.
Documents that prove decline of sales amount
Documents that proves payment of rental fee of past 3 months
Declaration paper
If you need any kind of miscellaneous help relating to Japan, you can contact me via email.
akiyama(at)japan-law-tax.com You can change (at) into @
