Japan's M&A Subsidy 16th Call: Up to ¥10M for Successors

The short answer: four tracks by your role, with ceilings from ¥3 million to ¥20 million

*Compiled from the "ceilings and subsidy rates" section of each track's 16th-call guidelines (Ver.1.0, September 2026). DD stands for due diligence (the pre-acquisition investigation). Closure costs are an add-on when combined with another track.[Secretariat, 16th-call pamphlet (in Japanese)]

Every payment is made afterwards, and contracts or orders placed before the grant decision are not covered.

Which track is yours? It depends on whether you take over, buy, sell or close

Your track is set by your role in the handover. For one and the same deal, the buyer and the seller can each file one application.

Handing over to a relative or an employee qualifies for the Business Succession Promotion track even without an M&A deal. Sellers that are small businesses, with 20 or fewer employees (5 or fewer in commerce and services), can also choose the small seller type. You cannot apply for both in the same call.

Taking over from a parent counts too: conditions and eligible costs of the Business Succession Promotion track

The Business Succession Promotion track subsidizes investment such as equipment triggered by a handover to a relative or an employee. The condition is "to take over both management control and the shares within five years."[Business Succession Promotion track guidelines, 16th call (in Japanese)]

• Deadline for the handover: complete it within five years of the application deadline of 6 November 2026, that is by 5 November 2031. If it is not completed, the subsidy must be repaid
• The successor: someone with three or more years as a director or employee, or a relative with no experience as representative (blood relatives within the sixth degree, spouse, in-laws within the third degree)
• The company: three fiscal years of accounts and tax returns completed. For a sole proprietorship, five years since filing the notice of opening and the blue-return application
• Confirmation letter: obtain a confirmation of the succession plan from a certified business innovation support organization (認定経営革新等支援機関)
• Plan: raise value added (or value added per person) by 3% a year over five years

A change of representative with no transfer of shares, and reorganization within a group, are not covered. Payments to the predecessor for shares or land are not subsidized either. Eligible costs include equipment, outsourcing, commissioned work and fees to experts used for the business after the handover.

The higher ¥10 million ceiling requires total pay per employee to rise by at least 3% in the fiscal year after the one in which the project ends. If that is not achieved, the extra amount (up to ¥2 million) is repaid.

Brokerage fees for buyers and sellers: in the Expert Utilization track, "registered firms" and "contract dates" are the key

The Expert Utilization track subsidizes the fees of brokers, financial advisers (FAs, who act for only one side), due diligence and business valuation.[Expert Utilization track guidelines, 16th call (in Japanese)] Eligible fees include retainers, monthly fees, interim fees and success fees.

*Closure costs can be added in every type (¥1.5 million for small sellers, ¥3 million otherwise). Closure costs are not covered unless the handover is completed within the project period.[Small seller type guidelines (in Japanese)][¥10 billion company special rule guidelines (in Japanese)]

These four conditions trip people up most often.

• Registered firms only: brokerage and FA fees are covered only if the firm is registered under the M&A Support Organization Registration System
• Contract after the grant decision: if you sign with a broker before selection and get going, those fees are not covered
• Reach agreement within the period: a basic agreement or final contract must be signed within the project period
• Extra conditions for the ¥10 billion rule: the ¥10 billion declaration must be published, the seller's employees kept on for three years, and the transfer price must be at least ¥500 million, among others

When a seller sells the whole company through a share transfer, the company and its majority shareholder apply jointly. Note that the applicant changes depending on whether it is a business transfer or a share transfer.

After buying, and when closing: the PMI Promotion track and the Closure and Restart track

The PMI Promotion track covers integration work within three years of the deal closing. Handovers between relatives and reorganizations within a group are not covered.[PMI Promotion track, integration investment type guidelines (in Japanese)]

• Integration investment type: equipment investment for integration. Ceiling ¥8 million (¥10 million with wage increase), small firms 2/3, others 1/2
• PMI expert type: fees for experts integrating organization and operations. Ceiling ¥1.5 million, rate 1/2
• The two types cannot be applied for together in the same call. Choose according to how far integration has progressed

The Closure and Restart track covers the costs of closing a company that could not be sold, for people moving on to a new business or a job.[Closure and Restart track guidelines (in Japanese)]

• Stand-alone application: ceiling ¥3 million, rate 2/3. You must have started an M&A as a seller in or after 2020 and worked on it for three months or more
• Proof of starting: consulting a Business Succession and Handover Support Center, a contract with an M&A support organization, or registration on a matching site
• Eligible costs: judicial scrivener fees for liquidation registration, disposal of inventory, demolition of buildings and equipment, restoration to original condition, lease cancellation fees and more
• A stand-alone application requires closing the company itself within the project period

Taxes and filing deadlines when dissolving and liquidating a company are covered in taxes when closing a company.

From application to payment: start with the GビズID, and the money arrives in 2027 or later

Applications are accepted only through the electronic application system "Jグランツ". The schedule is as follows (as planned when the guidelines were published).[J-Net21 (in Japanese)]

1. Get a GビズID Prime account. Issuing takes one to two weeks, about three weeks when busy. You need the representative's e-mail address and mobile phone number.
2. Get quotes from two or more suppliers. Competitive quotes are the rule. For the Succession Promotion and Restart tracks, also prepare the confirmation letter from a certified support organization.
3. Apply on Jグランツ by 5 p.m. on 6 November 2026. Applications open on 2 October.
4. Selection notice in late December. From late January 2027, file the grant application and wait for the grant decision.
5. Sign, order and pay after the grant decision. The project period runs up to 14 months from late January 2027 (planned).
6. Payment after the performance report and final inspection. Reports on commercialization continue afterwards.

You may have to pay the full cost of equipment or brokerage fees yourself for more than a year. The cash-flow side of that is estimated in subsidies are paid afterwards.

Other subsidies closing in October are listed in subsidies with October deadlines.

Who it does not suit and what to watch: 60% are selected, five weeks to the deadline, and beware of broker sales pitches

The subsidy rates are generous, but four in ten applicants are not selected. According to the secretariat, the 15th call selected 338 of 551 applications (61.3%) and the 14th call 311 of 512 (60.7%).[Secretariat notices (in Japanese)]

*Selection rates calculated by this site from the secretariat's published counts. Results of the 16th call are due in late December.

Another option is to wait for the 16th-call results before deciding on the next deadline. In 2026 there were three calls (applications opened in February for the 14th, June for the 15th and October for the 16th).

Where tax comes in: the subsidy is taxable, and gains on selling shares are taxed at 20.315%

The subsidy counts as income (for companies, gross revenue) in the year it is received. The part spent on buying equipment, however, can have its tax deferred through compressed entry (for individuals, exclusion from total revenue).[National Tax Agency No.2202 (in Japanese)][Basic Circular on Corporation Tax, Chapter 10 Section 2 (in Japanese)]

• Equipment subsidies (Succession Promotion track, integration investment type): with compressed entry, depreciation falls by the same amount. It is a deferral, not an exemption
• Fee subsidies (Expert Utilization track): the fees are expenses, while the subsidy is income
• Disposal restrictions: equipment costing ¥500,000 or more per unit (excluding tax) needs the secretariat's approval to be sold or scrapped for a set period

Individual shareholders on the selling side pay 20% on gains from selling shares (15% income tax and 5% resident tax) plus the special reconstruction income tax.[National Tax Agency No.1463 (in Japanese)] If you receive shares from a parent by gift or inheritance, the business succession tax system lets you defer gift tax and inheritance tax. Under the special measure, the handover must happen by 31 December 2027, and whether it is extended will be decided in the year-end tax reform.[National Tax Agency, corporate business succession tax system (in Japanese)]

The subsidy and the tax system are separate, and you can use both. Deadlines and possible changes to the tax system are covered in business succession tax: from deferral to exemption?, and how the value of your own company's shares is set in taxes on acquiring and valuing unlisted shares.

Frequently asked questions

Summary

• Applications for the 16th round are accepted from October 2 to 5:00 p.m. on November 6, 2026. The adoption rate for the 15th round was 61.3%.
• Succession to family members or employees falls under the Business Succession Promotion track, offering up to ¥8 million for capital investment (¥10 million if wage-increase requirements are met).
• Buyers and sellers can use the Expert Utilization track for brokerage and due diligence costs, up to ¥11 million (¥20 million under the special exception for companies with ¥10 billion in revenue).
• Brokerage and financial advisor fees are covered only for registered providers. Contracts or orders made before the grant decision are not eligible.
• Applications require a GBizID Prime account, which takes one to two weeks to issue (about three weeks during busy periods).

References (sources)

• Business Succession and M&A Subsidy secretariat (in Japanese): 16th-call schedule and application and selection counts for the 14th and 15th calls
• Secretariat, 16th-call pamphlet, full version (in Japanese)
• Business Succession Promotion track guidelines (16th call, Ver.1.0, September 2026) (in Japanese)
• Expert Utilization track, buyer and seller types guidelines (16th call) (in Japanese)
• Organization for Small & Medium Enterprises and Regional Innovation, J-Net21 (in Japanese)
• Small and Medium Enterprise Agency, SME M&A Guidelines, 3rd edition (in Japanese)
• M&A Support Organization Registration System (in Japanese)
• National Tax Agency No.2202, receiving government subsidies (in Japanese)
• National Tax Agency No.1463, taxation on transferring shares (in Japanese)
• National Tax Agency, corporate business succession tax system (in Japanese)

*Amounts and rates are as stated in the 16th-call guidelines (Ver.1.0). Estimates are this site's approximations. This article is general information. For individual decisions, consult the secretariat, a certified support organization, a tax accountant or another professional.