Owner's personal spending on behalf of the company, expenses through a subcontractor, and personal deductions

Personal money an owner spends in the company's interest is recorded in the books as a debt owed by the company to the owner — a legitimate business expense that reduces taxable profit; it can be repaid at any time, even just once a year, as long as it is recorded and receipts are kept. A founder's loan works the same way — personal money used for company needs (for example, payroll) can be structured as a loan to be repaid later, a standard practice during cash-flow gaps. A freelancer or sole proprietor can also legally structure expenses through a subcontracting contract: money forwarded to a subcontractor (for example, to Kazakhstan via Wise against invoices with a contract) is not counted as the sole proprietor's profit and is not taxed as income, provided it is documented with invoices, a contract, and transaction records, kept for 5 years; hiring contractors abroad for Japanese clients still means local consumption tax is owed. On personal deductions, self-medication tax relief (for over-the-counter drugs) and the ordinary medical expense deduction are mutually exclusive — only one can be chosen per tax year. Finally, a sole proprietor can legally "gift" up to 1 million yen a year to a family member without gift tax, and record it as a business expense, though nuances around a family member who already has their own income were not fully clarified in the chat; a gift to an individual is generally subject to gift tax above roughly 1 million yen a year.