Sole proprietor (kojin jigyo) vs company (hojin) — comparison overview

In Japan an entrepreneur chooses between operating as a sole proprietor (個人事業主) or incorporating a company (株式会社/合同会社, KK/GK). The choice affects tax burden, social insurance contributions, how money can be taken out of the business, and the cost of maintaining the entity. Key comparison points: the income level at which a company becomes more tax-efficient than sole proprietorship; the difference in how owner income is structured (a sole proprietor's income equals profit after expenses, while a company owner must formally set a director's salary); differences in social insurance cost; dependent allowances available only to company employees; an extra tax that applies only to sole proprietors (個人事業税); rules on withdrawing cash from a company bank account; taxation of unregistered self-employment; typical costs of maintaining a company; and the option to keep a company dormant without legal issues. See the linked detail records for each topic.