The Cons of Working as a Freelance Software Engineer in Japan｜A Perfect Guide to Get Jobs and Work in Japan

Ah, the dreams of working as a freelance software engineer… just you and your laptop, coding anytime, anywhere you want. Perhaps you envision yourself lounging in a stylish café with a nice cup of coffee, sitting in an airy park underneath the cherry trees, or getting some work done while on a trip abroad.

Sounds pretty nice, right? Well… it can be. But making the decision to work as a freelance software engineer in Japan is a big step, one that involves a few more additional risks than freelancing in your own country. In this article, we’ll first look at the cons of this workstyle to give you a healthy dose of the reality that awaits.

Being Your Own Boss Is Work!

Being a freelancer essentially means running your own company. Accordingly, you’re now responsible for all of the work that entails. On the “front end” side, you’ll have to sell your skill and services, find clients, take care of negotiation and other communication with your clients, all the while maintaining professionalism. On the “back end” side, you’ll need to manage your own tasks and deadlines, and oversee all of your financial affairs.

This means that time management is key to keeping on top of your different projects while also effectively running the business aspects of your life. If you’re the type of person who doesn’t enjoy wearing many proverbial hats and prefers to focus on your core specialty, all of this extra administrative work can be stressful and exhausting. Success on the business side completely depends on you.

Taxes Can Be a Pain

Taxes are one type of administrative aspect that can be very easy to overlook. Perhaps you have clients already lined up and everything seems easy: you do the work they need, then they pay you, right? Seems simple enough, until tax time rolls around.

As a freelancer, you’ll have to track your own income and expenses as well as things like collecting and paying sales tax. You’ll want to keep detailed records of any business expenses you incur, such as computer equipment or phone bills, or perhaps train fare if you need to visit clients, among other expenses.

Then when it is tax time, you’ll need to report your taxes to your local tax office with a 確定申告 (kakutei shinkoku) or final tax report. If you don’t have a lot of confidence in your Japanese reading ability, you might be able to bring your paperwork to the tax office and receive help. But tax offices (especially those in Japan’s larger cities) get very crowded around the filing deadline and this can take time out of your schedule.

Of course, you could always work with an accountant to help with bookkeeping and tax preparation. But that will cost money, which could be yet another financial burden when you’re just starting out.

You’ll Need a Valid Work Visa

As we discussed in a previous article, having a valid visa is essential to working in Japan. This may make it difficult to come to Japan and start working right away as a freelancer. Most freelance software engineers in Japan will probably have started working on a company-sponsored visa, but that visa will expire eventually upon leaving the organization. That’s why you’ll need to look into the requirements for applicable visas.

Money Can Be Tight

If you were working at a Japanese company before, you may find that working as a freelance software engineer means having to forgo nice perks such as housing or committing allowances, and a company pension. You’ll also have to give up your social insurance or 社会保険 (shakai hoken) and enroll in National Health Insurance or 国民健康保険 (kokumin kenko hoken). The cost for this insurance will come entirely from your pocket, and it’s more expensive than social insurance.

Moreover, while building up your client base, you’ll need enough money to cover all of your living expenses. Before making the transition to freelance life, make sure that you have enough in savings to support yourself. Some people recommend having at least six months of savings, though that amount may vary based on your situation.

Even with a regular client base established, you may find that your month-to-month income varies considerably. Some months may yield more work, while other months have less, and there could be delays in client payments. For all of these reasons and more, you’ll still want to retain a certain amount of savings as a cushion during lean times.

There May Be Hurdles to Overcome

Regardless of how good your skills are as a software engineer, some companies may have policies in place that bar contracts with individual workers. If you start your own company, this will not be much of an issue, but assuming that you are working as a sole proprietor or 個人事業主 (kojin jigyonushi), you may encounter this from time to time.

Even when your freelance status is not a barrier, potential clients may view you as inferior to a company. They might assign less value to your work, expecting you to do the same work for less. Know the market value of your abilities and don’t feel pressured to sell your services a discount if you’re not comfortable with that.

Finding Clients Can Be Hard

Japan is a society that values trust and loyalty. When striking out on your own, it can be difficult to convince potential customers to take a chance on you without having someone that can vouch for your reputation. Simply trying to persuade them that you can handle a project faster/cheaper/better may not be enough. Personal connections and introductions go a long way in Japan, so put some effort into networking and gaining leads through word of mouth.

That being said, it certainly cannot hurt to be proactive in your search for new customers. Don’t be afraid to attend industry events, hackathons and startup coding camps and spread the word about what you can do. Giving a presentation talk at a Japanese technical conference could also be a great way to potential employers. Just be prepared that you may need to allow some time to build relationships and develop your reputation.

Conclusion

We hope this article has given you an idea of the drawbacks to working as a freelance software engineer in Japan. Don’t let these challenges deter you from what could be a very rewarding workstyle, however! In another article, we’ll also look at the pros to freelance life as well, so stay tuned.